Austin taxing authorities revisit historic property exemption

The Austin ISD board of trustees considered in early May a draft proposal to cap its historic property tax exemptions at $3,500 for properties purchased after Dec. 31, 2011. The board is scheduled to vote on the proposal June 18.

AISD's current policy exempts taxes on 50 percent of a historical building's value and 25 percent of the land value. The district does not cap the exemption amount.

On June 4, the Austin Community College District limited its tax exemption for historic residences that serve as a homestead to the average taxable value of all residential homestead properties within ACC's taxing district.

Neil Vickers, ACC vice president of finance and budget, said the average home value is about $250,000, so with ACC's take rate at 9.48 cents for every $100 of valuation, the cap is about $250.

The taxing authorities' decisions to revisit the tax policies have largely been prompted by the city revamping its policy in December by adding more rigor to the inspection standards and placing a $2,500 cap on reimbursements for properties purchased after Jan. 1. The city had been faulted for allowing too many houses to have a historic designation, allowing the owner to file for an exemption—some, perhaps, undeserved.

The city previously had a reimbursement cap of whichever was the greatest: $2,000 or 50 percent of the property tax, depending on when the property was purchased.

Proponents of historic tax exemptions say they encourage residents to move into older houses and help alleviate the higher cost of maintaining these properties compared with newer properties.

Critics say the exemptions primarily benefit the wealthiest residents. According to Travis County, the average assessed value of historic properties is $874,853

Alyson McGee, deputy historic preservation officer for the city, said 435 properties requested an exemption this year out of 588 historic properties in city limits.The city's historic preservation department is responsible for designating all of the historic properties.