The state's Senior Property Tax Deferral Program has been making headlines, and I've been receiving a number of emails about it. This page should provide you with more information about the program, as well as recent changes made that are affecting seniors across the district.
Under this program, qualifying seniors and people with disabilities can defer their property tax payments, which are made by the state. When the home is sold, the state is repaid out of the proceeds, so that the fund can be maintained on a self-sustaining basis. It's been a huge help for many of Oregon's seniors and has allowed Oregon's counties to receive the local tax revenue that they need.
Unfortunately, with our aging population and the decline in housing values, the fund has gone into deficit and become unsustainable in its current form. During the 2011 session, the Legislature was compelled to make several eligibility changes to the program, designed to reduce the cost of the program by reducing the number of people covered. These changes were made in an attempt to prevent total elimination of the program, something that was provisionally on the table.
Most of the changes were intended to focus the program on less affluent seniors. However, one of the biggest and most difficult changes is that seniors with reverse mortgages on their homes are no longer eligible. Unfortunately, the changes came as a rude awakening to many seniors who didn't know that they would no longer qualify, and are now finding out that they'll have to pay their propertytaxes this year.
As you may have read in the Oregonian, the House and Senate Revenue Committees held a special hearing recently on this program. The Department of Revenue is analyzing the applications that they have received this year to determine how many seniors are being impacted by the changes. They expect a full report to be available in early November, which I'll share with you. We'll most likely be taking another look at the program and the changes in the next legislative session in February 2012.
Click here to read a brief description of the changes to the program, and the current status.
Here's a second, more comprehensive, handout on the changes.
Given the state's current financial position, we have to make sure that this program is self-sustaining, and that it continues to help as many low-income seniors as possible.
It's my hope to work together with my colleagues in Salem and with Multnomah County to figure out how we can help the seniors who no longer qualify to stay in their homes, while coming up with a long-term solution for keeping this program solvent.
During the lead-up to the February 2012 session, we'll be considering our options for making changes to the program that will allow some of the seniors who have been disqualified under the 2011 legislation to stay in the program. It may be possible to make these changes retroactive, meaning that they would allow qualifying seniors to have their 2011 taxes deferred. Stay tuned to the newsletter for more updates.