Bill would provide tax credit for people whose homes were destroyed in disasters

In an effort to provide relief for victims of catastrophic storms like the tornado that shattered the Pinaire Mobile Home Park last year, eight state lawmakers have introduced a bill to abate property taxes on homes destroyed in natural disasters.

House Bill 2063 would provide a tax credit for homeowners who live in a disaster area and suffer more than 50 percent damage to their property. The amount of the credit would vary, to compensate the homeowners for taxes levied after the destruction of their homes.

“I haven’t talked to anyone in either party who doesn’t agree that we should be lowering taxes for people who are in these situations, so I think if it gets to the floor it will pass,” said Rep. Brandon Whipple, D-Wichita, who co-authored the bill with Rep. Joe Edwards, R-Haysville.

In addition to Whipple and Edwards, the bill has six co-sponsors so far, all Republicans.

Under current state law, the value of homes and mobile homes for tax purposes is set on Jan. 1 of each year. The property owner is responsible for the full year of taxes, even if the home is destroyed early in the year.

That was the situation facing residents of the Pinaire park and nearby residents in and around southeast Wichita, where a tornado the night of April 14 destroyed 144 houses and mobile homes.

Although the destroyed homes were bulldozed and the debris carted away to a demolition landfill, residents were surprised about eight months later when they got tax bills for the entire year.

The tax bills ranged from $29 on a 1968 single-wide trailer to $3,323 on a single-family home valued at $132,000, according to county records.

“Many of the people in that community were quite upset that they had to pay all their tax obligation when they frankly didn’t have a home to live in,” said Rep. Jim Howell, R-Derby, a co-sponsor of the bill. “It was an extreme hardship for them.”

Whipple said he contacted Edwards about sponsoring a bill after he read an article in The Eagle in December about the tax problems of the Pinaire park residents.

As written, HB 2063 won’t provide relief to those who lost their homes in the April tornado, said Edwards, whose brother, the Rev. Doyle Edwards, lost his mobile home in the tornado.

“I told my brother Doyle, ‘This may not assist you in this situation, but future natural disasters we wanted to make sure we do that,’ ” Edwards said.

Edwards said he wanted to make the tax credits retroactive to cover the April storm victims, but tax officials told him it would probably be impractical at this point.

“They said that would open a can of worms that would just be almost impossible,” Edwards said. “We’re thinking what we’ve done is the right thing to do.”

Whipple and Edwards said they settled on a tax-credit system because it’s simple and minimizes the administrative burden on local tax offices.

“They (disaster victims) will pay the tax, but they’ll get a refund on the tax,” Edwards said. “The way we’re doing this is the simplest way of making this happen and giving them the exemption from the date of the natural disaster, whatever it may be, tornado, flood, windstorm.”

Whipple said he also would have preferred a system where the homeowners wouldn’t even be billed for the tax, but he added, “At the very least, it’s better that the taxpayer will get the money, particularly in a time of crisis, as opposed to not getting it at all, even if it is a little later.”

The April tornado destroyed 11 houses and 134 mobile homes. The total damage from the storm was estimated at $146 million.

That was enough to trigger federal disaster money to help local government with debris removal and restoration of public services, but not enough to qualify residents for individual federal aid.

Howell said because of that, he may try to expand the definition of disaster in the draft language of the bill, which was prepared by the Legislative Research Department.

At present, the tax relief only would go to victims in disaster areas declared by the president.

“That might be a concern, that we would have to open that up to include the governor for the purposes of enacting this provision,” Howell said. “Some of these things, we’ll probably debate, I’m sure, in committee.”

Whipple said his next step will be to meet with Tax Committee Chairman Richard Carlson, R-St. Marys, to try to schedule a hearing on the bill.

Carlson was away from the Capitol on Thursday because of a family emergency and could not be reached for comment.

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