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Swain County seeks to secure ‘Homestead Exemption” for permanent residents

By Kristin Fox

At their recent meeting, the Swain County Commissioners voted 3 to 2 to adopt a resolution requesting the North Carolina General Assembly create a Homestead Exemption for citizens that have declared Swain County their permanent year-round residence. 

After a motion by Vice-Chair Roger Parsons seconded by Commissioners Phillip Carson, the motion passed to adopt the resolution which commissioners hope will give local citizens a tax break. Chairman Kevin Seagle voted in favor of adopting the resolution. Commissioners Kenneth Parton and David Loftis cast the two opposing votes.

North Carolina General Statute Chapter 105 authorizes counties to levy and collect ad-valorem property taxes. As it stands, the Homestead Exclusion was created by the North Carolina General Assembly to provide tax relief for senior citizens and persons certified as fully and permanently disabled. Swain County is asking the state to create an additional category to the exemption specifically for Swain County residents who have declared the county their permanent home. If the resolution is adopted by the state, Swain County hopes it will give local residents relief from higher property taxes due to higher land values.

Over the last few years, Swain County, like surrounding counties, have seen more people purchase property in the area for rental home and seasonal properties. The high number of rental homes and seasonal properties have driven up property values in turn raising property taxes.

The citizens that choose to live in Swain County are being affected by these tax increases with many local permanent residents facing additional hardships due to the higher property taxes.

The increased taxes are a hardship to many Swain County citizens who are already struggling. Swain County has a high poverty rate and have increased numbers of people on public assistance. The number of people on Medicaid and other programs are double the state average, currently 27% of the population.

As stated in the resolution the “Swain County Board of Commissioners request the General Assembly to approve a ‘Homestead Exemption’ for the full-time permanent property owners in Swain County. That the exemption should include a mechanism to reduce the valuation of full-time permanent tax payer’s property by the amount of $50,000 or 50%, whichever is greater, of the value of the property, for tax purposes only. This amount can be deducted on one qualifying parcel each tax year.”

Commissioners are hoping the state will approve a Homestead Exemption for Swain County similar to an existing exemption for elderly and disabled property owners. North Carolina General Statute 105 –277.1, known as the “Elderly or disabled property tax homestead exclusion,” establishes a mechanism to give relief to citizens that meet a certain criterion; county officials are hoping the state will adopt a similar statute for year round residents.

“If this goes through me, it takes the fortitude of the commissioners to raise taxes to then lower the taxes, said Vice-Chair Parsons. “You have to raise taxes on everybody and then cut taxes on the first property or it doesn’t work. If you cut taxes on residents, then we don’t have enough revenue. Local people don’t pay any extra, but the people that are not local will pay more. It is a twofold process.”

Swain County is comprised of a tax base that is approximated 12 percent, well below the state average. The ownership of lands in Swain County by permanent year round residents is approximately 40% of the total land base.

“I think it is a very interesting concept, but it will be hard for people to understand exactly what it is we are doing,” added Parsons.

Next, Swain County will take the resolution to the state representatives; however, it won’t be initiated this year and is probably at least year away if the state approves it. However, if it approved and is on the books in Raleigh, it would be up to this board or future boards to implement it. If they chose to or not, they would always have the option to do it. It would be a local bill that commissioners would have the authority to implement.

While Parton is in favor of helping the local year round Swain County citizens, he voted against the resolution because he stated he is not in favor of raising taxes unless the commissioners have a public hearing.

While most US states have a form of Homestead Exemption, the majority are for protected groups such as the disabled, the blind, or the elderly. Florida’s Homestead Exemption is closest to mirroring the request from Swain County. In Florida, every person who has legal or equitable title to real property in the State of Florida and who resides thereon and in good faith makes it his or her permanent home is eligible to receive a homestead exemption of up to $50,000. The first $25,000 applies to all property taxes. The additional $25,000 applies to any assessed value over $50,000 and only to non-school taxes. Florida then has additional exemptions on top of the general exemptions for the elderly, veterans, and the disabled.

Similar to Florida, Georgia also offers a Standard Homestead Exemption for all permanent residents that states:  “The home of each resident of Georgia that is actually occupied and used as the primary residence by the owner may be granted a $2,000 exemption from county and school taxes except for school taxes levied by municipalities and except to pay interest on and to retire bonded indebtedness.” Georgia then also has additional exemptions above the standard for the elderly, disabled, and veterans.

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