Kittery correcting hundreds of erroneous tax bills sent to senior citizens

KITTERY, Maine — The town is remediating hundreds of erroneous tax bills sent out to residents after miscalculations tied to the state’s sunsetting Property Tax Stabilization Program for senior citizens.

A total of 558 Kittery property owners were previously approved for the program and all but one received a tax bill with an error. Town Manager Kendra Amaral said the vast majority of those property owners were given too much of a credit by the town, while some didn’t receive enough of a credit.

The billing errors ranged from some Kittery residents being undercharged $380 to some being overcharged as much as $225 in their tax bills. The total was an undercharge of approximately $137,000.

Those who were undercharged were residents who became first-time exemption applicants for other programs, Amaral wrote in a report to the Town Council.

How is Kittery correcting the billing errors for affected residents?

In November, residents who were given too much of a credit will receive a letter with another bill that will make up the difference. Kittery citizens who didn’t get a full credit will later get an additional credit on their second tax bill.

“We looked at a lot of different options and what we’ve decided is the fairest and makes the most sense for the clarity of the taxpayer is that we’re going to issue a supplemental after Oct. 31,” Amaral said. “Everybody who got their bill who has the tax stabilization program, pay your bill as you got it this first (time).

“Then we’re not going to have a late fee that goes with that,” she added. “So that additional amount that might be owed for those who were over credited will just be due when the second tax bill is due. There’s a lot of time there.”

Property and personal taxes will be collected on Oct. 31, Feb. 15, 2024 and May 31, 2024, as set by the Town Council.

What was Maine's expired Property Tax Stabilization Program?

The program was enacted by Maine’s legislature in the summer of 2022 but repealed this July, meaning it will end after only being in effect this current tax year.

“Property Tax Stabilization for Senior Citizens, also known as the Property Tax Stabilization Program, is a State program that allows certain senior-citizen residents to stabilize, or freeze, the property taxes on their homestead,” a state description explains. “As a result of recent changes in the law, the Tax Stabilization Program will only apply to the property tax year beginning April 1, 2023.”

Amaral explained it further.

“The intent of the law was to freeze the qualifying taxpayer’s bill (regardless of change in assessed value) at the same dollar amount (or less) until they no longer live in Maine,” she wrote. “Cities and towns, Maine Municipal Association and many others raised significant issues and concerns with implementation of the law; and the legislature repealed it the following session.”

How did the errors in Kittery happen?

The errors occurred after the town applied individual credits to each account while up against deadlines to release tax bills.

Vision Government Solutions, the town’s contracted software company for billing, did not apply the credits to residents’ accounts because the program is only applicable in Maine and only in use for one year, according to Amaral.

That left it up to the town to address the credits, she said.

“In the process of pulling together all the reports we needed from the state, we discovered that for the majority of those 557 senior tax stabilization accounts, we had actually not pulled the assessment to include their homestead exemption and their veterans exemption,” she explained. “We actually gave them too much credit, for the most part. We have a handful that we didn’t give enough of a credit because they’re first-time homestead exemption applicants or first-time veteran exemption applicants, or dual.”

More Kittery news: Town Council candidates debate issues and record of candidate who resigned in 2021

Town assessor Paul McKenney said, “We always make sure the numbers match before we send out tax bills, and they did, but we did it in a different way where we had to hard code last year’s tax rate into the tax billing system."

This article originally appeared on Portsmouth Herald: Kittery ME correcting erroneous tax bills sent to senior citizens