Missouri Governor Jay Nixon proposes waiving property taxes for some homebuyers

KSDK -- Missouri Governor Jay Nixon and State Treasurer Clint Zweifel, chairman of the Missouri Housing Development Commission (MHDC), announced a proposal to pay the first year of property taxes for income-eligible Missourians who buy a new or existing Missouri home after Jan. 1, 2010.

The proposal will be presented to the MHDC at its December 18 meeting.

If approved by the commission, Missouri families making less than $98,000 a year who enter into a contract to purchase a new or existing home after January 1 would have their property tax paid up to $1,250. Those families would be eligible to have an additional $500 paid towards the tax bill if the homeowner purchases energy efficient home or items, such as Energy Star appliances.

The proposal is expected to pay the property taxes for 9,000 to 11,000 Missouri families using $15 million in unencumbered reserve funds at MHDC.
Who is eligible?

Income eligibility is based on previously adopted MHDC guidelines. Depending on the county of the home sale, household income limit guidelines for low to moderate income persons or families approved by MHDC last spring range from $58,300 to $98,560. These grants are for owner-occupied purchases only.

When would it start?

If approved by the MHDC at its next meeting on Dec. 18, 2009, funds would be available for contracts entered into after Jan. 1, 2010, on a first-come, first-served basis.

Where is the funding for this program coming from?

The funding would come from a reserve fund held by MHDC earned through successful management of mortgage loans made to low- and medium-income individuals and families. These reserve funds are not from general revenue, nor subject to the legislature's appropriation process.

How much of the property tax bill could be paid?

Eligible homeowners could have up to $1,750 of their property tax bills paid. According to the State Tax Commission, the average residential real estate tax bill for a Missouri homeowner is $1,160. An income-qualified individual or family is eligible to receive $1,250 or the amount of their first year's real estate tax bill, whichever is highest, when they purchase a new or existing residential home. An income-qualified individual or family can enhance this base amount, up to $1,750, if they purchase an energy-efficient new home or make energy efficient improvements to an existing home that is purchased. These improvements must be made prior to closing or within 60 days of closing.

How do Missourians apply for these funds?

Forms and affidavits will be part of documents executed at the home sale closing. Additional receipts and documentation will be required for proof of energy efficient improvements.

What energy-efficiency upgrades would be eligible for the additional incentive?

Eligible improvements would include installing high-performance windows, house wraps, programmable thermostat controls, water-efficient toilets and faucets, and energy-efficient water heaters, lighting and appliances; sealing heating and air conditioning ductwork; caulking; insulating water heater pipes; increasing the R-value of insulation in crawl spaces and attics; and conducting on-site energy efficiency inspections and tests, including a blower door test, which tests the overall energy efficiency of the house, and a duct blaster test, which tests how much the air ductwork leaks.