In November 2006, voters approved a Tennessee Constitutional amendment giving the Legislature the authority to enact new laws allowing local governments to offer an optional property tax freeze program for people age 65 and older. The 105th General Assembly subsequently enacted The Property Tax Freeze Act in 2007. Under the new law, senior citizens within a low-income bracket may have the base property tax amount on their primary residence “frozen” starting with the first year they qualify and apply. They must continue to qualify for the freeze each subsequent year. The property tax freeze qualifying income level is determined by the Comptroller under statutory definition.
Sen. Mark Norris (R-32) filed SB0004 in early November. The Bill would make a change to the qualifying income definition in Tenn. Code Ann. § 67-5-705(f). His Bill changes the language in the definition from “as determined in the most recent federal decennial census,” to “as estimated by the U.S. Census Bureau in the year following the most recent census.” Senator Norris’ intent is most likely to change the definition from 2000 Census numbers to estimates based on the 2010 Census, and might therefore make the definition more accurate, at least until the 2010 Census numbers are officially released. Once the 2010 Census numbers are made official, and if this Bill passes, the statutory definition will later need to be changed back to the original language in order to eliminate the use of prior estimates.
Until the 2010 Census estimates are made available it is hard to predict what actual effect this Bill may have on the income definition. The U.S. Census Bureau report “Income, Poverty, and Health Insurance Coverage in the United States: 2009″ issued in September 2010 indicates that although the average median income for every other group has fallen, it rose 5.8% nationally for people over 65. However, the average median household income for people living in Tennessee fell from $44,741 in 2000 to $40,034 in 2009, so the national trend for seniors may not reflect the Census estimates in our own state.