W.Va. home values prompt calls for property tax relief

February 14, 2006|by ROBERT SNYDER


The red-hot housing market in Berkeley County has produced two measures this session from West Virginia lawmakers who say they're concerned about the effect rising taxes have on the county's senior citizens.

The proposals haven't come a moment too soon for Berkeley County Assessor Preston Gooden, who says rising assessments are driving retirees to consider selling their homes because they can't afford the property taxes.

"We need to do something for our seniors now," said Gooden, who has threatened to freeze assessments himself.

A bill introduced late last month by Sen. John Yoder, R-Jefferson, that would freeze property taxes for residents ages 65 and older, has Gooden's backing because of its flexibility.


The bill, which could be adopted on a county-by-county basis, would defer property tax increases until the homeowner's death or until the property is transferred. At that point, back taxes would be paid, without interest, Yoder said.

It's a good bill, said Gooden, who has been to Charleston, W.Va., to lobby on its behalf.

"It just keeps the tax on the land as a lien on that property, but it relieves taxpayers from having to pay it until their death," Gooden said.

A second measure, a joint resolution co-sponsored last week by Sen. Joe Minard, D-Harrison, Yoder and Sen. John Unger, D-Berkeley/Jefferson, would offset rising costs by increasing the state's homestead exemption from $20,000 to $50,000.

First approved as a constitutional amendment in 1982, the state's homestead exemption law, which applies to citizens 65 or older, exempts the first $20,000 of a home's value from taxation.

Home prices in Berkeley County saw steep increases from the middle of 2004 to the same period in 2005, said county Real Estate Manager Brad Unger.

The Gerrardstown, W.Va., area saw the greatest increases, with the average value of houses and land jumping 40.43 percent, Unger said. The average value of houses and land sold increased nearly 21 percent in Martinsburg, and almost 20 percent in Bunker Hill, W.Va., Unger said. The Falling Waters, W.Va., area saw the smallest hikes, with prices rising less than 10 1/2 percent.

Prices increased in value about 34 percent in Inwood, W.Va., and about 30 percent in Hedgesville, W.Va., Unger said.

Unger said he noted a different trend with houses in subdivisions increasing in value at a slower rate than houses sitting on larger lots of land.

"Houses outside of developments are selling higher because those pieces of land are getting harder to find," Unger said. "When it comes to trying to find acreage, it's hard to get anymore."

Countywide, average home prices jumped $75,000 from 2003 to 2005, increasing from $148,000 three years ago to $225,000 last year, Unger said.

Yoder said the price increases will mean a changing demographic for Berkeley County.

"The problem here is if you're on a military income or retired from the federal government, this is a good place to live. But if you're looking at people who were born here and lived here all their lives and had planned to retire here, they're being priced out of their homes," Yoder said. "It's no longer as attractive for them."

While supportive of the resolution, Yoder said it fails to go far enough for seniors.

"Although I support it, I don't consider it to be adequate to give Eastern Panhandle residents the relief they need," Yoder said. "To a lot of the state that would be adequate ... but here it's nothing."

Unger acknowledged as much, adding he'd prefer changing the exemption from a flat figure to a percentage amount.

"Although (a flat rate increase to $50,000) is a start, it's not going to solve our problem in the Eastern Panhandle with our sky-high housing," Unger said.

Unger said a percentage-based exemption would be felt differently by different counties, depending on their individual housing markets.

"A home at $100,000 in Braxton County might be $200,000 in Berkeley County, and if you go to a percentage you get a bigger amount off," said Unger, adding an exemption set at 20 percent of a house valued at $200,000 in Berkeley County would total $40,000, instead of a $20,000 exemption the same house would receive in Braxton County.

Gooden said he recognizes the dilemma some counties would face if the cap were lifted on the state's homestead exemption.

"There's some counties that don't think they can afford it," Gooden said. "It would cripple some counties' budgets."

While Yoder is cautiously optimistic about his bill's chances, he said a request by Gov. Joe Manchin that legislators not take up taxation bills this session could delay efforts to help county seniors.

The governor's press secretary, Tom Hunter, acknowledged Manchin's request, calling it part of an effort to look at the state's tax issues more comprehensively later this year.

"We're in a situation where we have piecemealed the tax structure for the past 80 to 85 years," Hunter said. "The governor wants to bring about meaningful tax reform for businesses and the citizens ... for the economic health of the state."

Yoder said he worries waiting until a special session would put too many restrictions on legislators' ability to frame the matter, and would take too long.

"I'm trying to argue that we can't wait until a special session," Yoder said.

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