91-year-old grandma is penalized by Idaho Legislature’s change to the circuit breaker
How did your state representative or senator vote on House bill 389, the property tax bill revising provisions regarding the homeowners exemption, circuit breaker, disabled veterans property tax reduction, property tax deferral and taxation of personal property?
The bill was rushed through in the final days of the Legislature in May with little consideration of the effect on current property owners who have qualified for the property tax reduction (circuit breaker) program.
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HB389 removed from the circuit breaker program an entire group of people whose property exceeded 125% of the median assessed value of properties receiving the homestead exemption. At first glance, one might believe this change would only remove wealthy people who were taking advantage of the circuit breaker program and had property values exceeding $500,000. They must be rich, right?
Wrong. Our 91-year-old mother, mother-in-law, grandmother and great-grandmother and her husband built their home 56 years ago and raised 11 property owners and tax-paying Idahoans. For 56 years, they have taken care of their home and the acre it is built on. During those 56 years, their property was annexed into the city of Boise, and homes have gone up all around them.
Grandma and Grandpa paid about $38,000 to buy the property and build their forever home. The 11 children they raised are gone now, and Grandma spends her days in her recliner looking out on the pasture where ducks, geese, rabbits, a horse and an alpaca play. She has no intention of moving, but since the Legislature has failed to increase the homeowners exemption commensurate with rising property values, and have, with this bill, eliminated a modicum of tax relief, she is being taxed out of her home.
The circuit breaker was a way to soften the blow of rising property taxes. It didn’t eliminate her property tax burden, but it made it livable. Remember, the circuit breaker maximum for 2021 is only $1,500.
Some might think Grandma is rich since her taxable property value for 2021 is $693,900. But that’s where those responsible for passing HB389 failed to look past the property value and evaluate the ability of the elderly homeowner to keep up with the unfettered increase in taxable value.
In Grandma’s application for the 2021 circuit breaker, her sole source of income was from Social Security at $28,460. Her medical expenses were $11,617 leaving a net income of $16,843. For tax year 2020, her total property taxes were $5,695, 34% of her net income!
In 2003 her home and land, for tax purposes, were valued at $270,900. This was the year her husband of 53 years passed away, leaving her to maintain and pay taxes on their forever home. That same home and property, without any significant improvements, is now valued for tax purposes at $693,900.
About 1,500 individuals and properties would be removed from the circuit breaker program as a result of passage of HB389, according to the Idaho State Tax Commission. Seriously! Did our legislators intend this?
With a state budget surplus approaching $900 million, our legislators have removed 1,500 citizens who needed help with their tax bills.
How much did that save?
The maximum possible reduction for 2021 is only $1,500 — $1,500 for 1,500 widows and widowers, blind or veteran, totals $2,250,000 spread across the entire state!
It is shameful. It is an embarrassment and an insult to the men and women who built this economy and educated our children.
Contact your local legislator and ask them to revisit HB389 in the next session and correct these wrongs!
Jim Reed is a resident of Weiser.
