Assessing consultant recommends tying income limits for elderly, disabled exemptions to Social Security COLA; board must still approve changes

Bob Gagne, the city’s contract assessing supervisor with Whitney Consulting, told the Nashua Board of Aldermen on May 12 that the city should index income eligibility limits for elderly and disabled property tax exemptions to the Social Security cost-of-living adjustment to prevent those benefits from being eroded by rising property values. "I would suggest, some measure like, how much is Social Security ... went up in that given year," Gagne said, describing COLA as a straightforward benchmark for annual adjustments.

Gagne outlined the legal and calendar constraints aldermen must bear in mind. He said he did not believe the board could delegate approval of eligibility and benefit changes and that "the way the statute's written, it has to be approved by the governing body." He advised that any changes to income or asset limits be finalized before Jan. 1 so they can be used for the exemption application period that begins each January and that staff aim to bring recommendations to the Board by late August or September so changes can be reported on the MS-1 tax form.

Administrative Services Director Tim Cummings introduced the discussion and said the presentation would focus narrowly on credits and exemptions. Gagne gave a primer on common programs — elderly, disabled, blind and veterans credits — noting that most programs are required by statute but that the all-veterans credit and the disabled exemption are optional for municipalities.

Alderman Klee pressed staff on whether the city could make adjustments in "real time" without repeated legislative action. Klee said Nashua currently redistributes what she estimated to be "almost $5,000,000" in tax relief through credits and exemptions and asked whether the city could adopt an automatic trigger to update limits. Gagne warned that authority cannot simply be delegated, recommended using a resolution or ordinance to spell out the policy, and said the City would still have to approve the numbers before they take effect.

On specific figures, Gagne said the single-person income limit on the city's website was $57,000 and the married limit $67,000 and recommended applying the most recent COLA to those thresholds for the following exemption season (Jan. 1–April 15). "The income limit, for single has to go from 57,000 to 59,500," he said as an illustrative calculation tied to a hypothetical COLA increase.

Gagne described a policy option used in Manchester to reduce the fiscal impact of optional disabled exemptions: lowering income and asset thresholds and aligning disabled benefits with the elderly schedule so fewer optional disabled exemptions are granted. He urged the Board to consider trade-offs between expanding eligibility (raising income limits) and preserving the dollar value of exemptions for current recipients (increasing benefit amounts to match revaluation gains).

An alderman asked about median home value; Gagne said he believed it was "a little over $500,000" and offered to follow up with precise figures. He also agreed that, to avoid reacting to a single-year spike in COLA, the Board could enshrine a three-year running average in a resolution so staff implementation is consistent.

No policy vote was taken at the special meeting. Alderman Clemens moved to adjourn; the clerk recorded a roll-call vote of 12 yays and 0 nays, and the meeting ended at 7:24 p.m. City staff indicated they will return with formal recommendations and timing options for the Board’s consideration ahead of the next exemption application cycle.