Senate Legislation

Published 12:00 am Tuesday, January 13, 2009

Supervisors worry that senate legislation would hurt budget

By Billy Davis

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When Mississippi’s county supervisors meet in Jackson today for their annual mid-winter conference, Panola County’s legislative delegation can expect to hear from Panola supervisors about legislation that would affect the state’s homestead exemptions.

Supervisors on Monday were told that bumping the allowances as proposed in Senate bill 2300 would cost Panola County $212,902 next year in lost revenue.

“And that’s a conservative estimate,” Bill Bryant, a contracted tax consultant for Panola County’s tax assessor’s office, told the board.

Legislation that passed in the state Senate last week would increase the homestead exemption from $75,000 to $100,00 for people who are 65 years old or disabled.

The bill would also boost the maximum exemption from $300 to $400 for other property owners, supervisors said Monday.

“On the surface it looks great,” Bryant said, then he described what supervisors said they were concerned about: increasing the homestead allowances could require a raise in millage.

Bryant said DeSoto County could lose $2.3 million in tax revenue and would need a 2 1/2 –mill increase to make up the difference. Smaller counties that don’t have DeSoto’s population and growth could see an even bigger increase in millage, he said.

Panola supervisors approved a five-mill increase for the current budget year and are presently overseeing a budget crunch worsened by a weakened economy.

“It’s like a shell game,” Bryant continued. “You take it from one pocket and put it in another.”

The estimated loss of $212,902 came from the county tax assessor’s office, County Administrator Kelley Magee told The Panolian after the meeting.

State Sen. Nolan Mettetal said Monday he supported the Senate bill because homeowners have seen their home values increase while the homestead allowance has remained the same.

Mettetal sits on the Senate Finance Committee where the bill originated.

“I think it’s common knowledge that people deserve a little larger break,” he said.

Mettetal also said the new allowances would take affect only after a county has done a reappraisal.

A January 10 Clarion-Ledger story about the Senate bill summarizes that supervisors could not raise property taxes in the year after an appraisal.

If the new land values showed an increase in revenues, supervisors must reduce the millage rate to keep collections at the same rate as the previous year, then adjust the property levies after a year, according to the story.

“The appraisal is going to increase – they never seem to go down – then that increase in appraisal, as we saw it, would offset the deserving deduction,” said Mettetal.

Senate Bill 2300 must now be debated in the House.

To offset the lost revenue for homestead exemptions, the state “kicks in” funding to the counties to make up the difference, explained state Rep. Warner McBride.

“I’m all for the bill as long as we have the money to offset the difference,” McBride said. “I’m just not sure this is the year we’ll be able to find the money.”