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File #: 19-298    Version: 1
Type: New Business Status: Passed
File created: 6/5/2019 Meeting Body: City Council
On agenda: 6/18/2019 Final action: 6/18/2019
Title Search: Consider an ordinance approving a residential homestead property tax exemption increase of 2% for a total exemption of 12%, as authorized and defined by Section 11.13(n) of the Texas Property Tax Code in the City of Keller, Tarrant County, Texas; providing a penalty; and authorizing publication.
Attachments: 1. 061819_Homestead Exemption Ordinance, 2. 061819 Homestead Exemption Presentation

To:                     Mark R. Hafner, City Manager

From:                     Aaron Rector, Director of Administrative Services

Subject:                     

Title

Consider an ordinance approving a residential homestead property tax exemption increase of 2% for a total exemption of 12%, as authorized and defined by Section 11.13(n) of the Texas Property Tax Code in the City of Keller, Tarrant County, Texas; providing a penalty; and authorizing publication.

Body

 

Background:                     

In 1986, the City of Keller approved a homestead exemption of 1% which was the exemption rate until 2016. The homestead exemption was increased to 4% in 2016, to 8% in 2017, and to 10% in 2018.  The exemption reduces the taxable value of a residential property with a homestead exemption by the greater of 10% of taxable value or $5,000.  The proposed ordinance would increase the exemption by 2% for a total of 12%.  The proposed exemption would reduce the preliminary FY 2019-20 (Tax Year 2019) taxable residential homestead value from $368,646 to $361,273 or a taxable value reduction of $7,373, based upon the Tarrant Appraisal District’s May estimate.  If approved, the exemption would be included in the Fiscal Year 2019-20 (Tax Year 2019) taxable value calculations.

 

Financial Impact:                     

Because the exemption will be applied to an upcoming budget year, staff will modify budget projections to accommodate the approved exemption.

 

Based upon early taxable value estimates, every 1% increase of exemption would reduce the potential levy by approximately $187,500.  Increasing the exemption by 2% would reduce the potential levy by approximately $375,000.

 

Citizen Input/Board Review:                     

Not applicable

 

Legal Review:                       

Not applicable

 

Alternatives:                     

City Council has the following alternatives:                       

-                     Approve as submitted

-                     Approve with changes

-                     Denial

 

Council Action:                     

Consider approval of a homestead exemption of 12%, which is an increase of 2% from the current exemption.