SCHENECTADY — The Schenectady City Council is preparing to increase the city’s income limit by roughly $3,000 annually for real property tax exemptions for seniors and disabled individuals.
Under the current city code, seniors and individuals with disabilities who make $29,000 or less per year receive a 50% tax exemption for the assessed value of their homes.
The city’s sliding scale allows seniors over 65 years of age and disabled individuals who have an income up to $37,399 annually to receive a corresponding tax exemption, with residents who take in between $36,500 and $37,399 per year receiving a 5% exemption.
State legislation passed in 2022 allows municipalities to raise the maximum income eligibility limit for the Senior Citizen Real Property Tax Exemption program and the Persons with Disabilities Real Property Tax Exemption from the current level $37,399 to $50,000.
In August, The City Council began exploring the possibility of raising its income limit for the programs for the first time since 2009, when the limit increased from $36,399 per year to $37,399.
During the council’s Finance Committee meeting on Monday night, city Assessor Molly MacElroy said she could not recommend raising the income limit all the way to the $50,000 maximum, but the official presented two potential scenarios to the council — increases to a $40,400 income limit or a $45,000 limit.
“Making an increase would be a wise decision, because we haven’t done that since 2009,” MacElroy said. “But making a big jump — listening to the budget [negotiations] — I wouldn’t want it to be a big problem and add to what’s going to happen in the future.”
MacElroy added that she was recommending that the council increase the income limit to $40,400 per year.
With the federal government set to increase Social Security benefits to more than 66 million recipients in January, in order to account for cost-of-living increases, the council hopes to ensure that residents who currently qualify for the tax exemptions are not turned away from the program if their income tips above the $37,399 limit.
Councilman John Mootooveren, chair of the Finance Committee, asked MacElroy during the Monday meeting if she believed raising the income limit to $45,000 would be too drastic.
“I think it’s too much — at least for the first year,” MacElroy replied.
Councilwoman Carmel Patrick asked MacElroy if she could estimate the impact that the $3,001 increase would have on the city’s budget.
“It’s hard because I don’t know who’s going to apply,” MacElroy replied. “It’s anybody who turns 65, it’s people who may have lost the exemption in the past because of a one-off situation, so it’s hard to predict.”
Councilman Carl Williams, who brought the tax exemption matter to the council, polled the council during Monday’s meeting, with the board agreeing unanimously that the city should proceed with a $3,001 increase for the income limit for both tax exemption programs.
“I’m inclined to go with the suggestion from our assessor, who is knowledgeable, so I would say let’s look at $40,400 at this point in time and we’ll revisit it — if we need to — down the road,” Mootooveren said during the meeting.
Mayor Gary McCarthy said on Wednesday that he supports the council’s proposal to raise the income limit to $40,400.
The council will hold a public hearing to gain resident input on the proposed change before the increase can be adopted.
“It’s $3,000 and it’s commensurate with the raise that people are getting in their Social Security, so it’s fair,” Councilman John Polimeni said of the proposal.