Saturday, December 5, 2020

Homestead Exemption Increase approved by City Council

The City’s homestead exemption has been increased from 12% to 16% by unanimous vote of the City Council, the sixth property tax relief initiative since 2009.

“The 16% exemption returns the organic growth in property values to residential homeowners,” explained Chief Financial Officer Sharen Jackson.  “It is the equivalent of a 7 ½ cent reduction off the tax rate of $0.462 per $100 valuation, and it’s thirty percent higher than the exemption offered last year.”

On an average-valued Southlake home, this exemption results in an annual savings to the homeowner of $462.

With the exemption, City revenue is reduced by $4,308 million from what would be received under the full tax rate.

“Our analysis considered how much relief we can provide while continuing to pay cash for capital projects, maintain appropriate reserves, and meet service expectations,” said Jackson.  “We have to consider the future impact of this decision.  I’m confident that we can continue to meet the needs of our growing city and adhere to our strong financial management principles with the implementation of this exemption.”

Previously the City has implemented tax relief initiatives in FY ’09, FY ’13, FY ’14, FY ’15 and FY ’16 with a focus on increasing the homestead exemption for residential property owners as new commercial properties have developed.

Last year the City was able to return the increase in property values to homeowners through the adoption of a 12% exemption.

City staff will work on the FY 2017 budget through the summer, finalizing it once certified values are received from each appraisal district.

Public hearings on for next year’s budget will occur in late August and early September.