Rep. Michael Moffett proposed legislation earlier this year to raise the cap on the optional disabled veterans’ tax credit. According to Moffett, the bill was designed to alleviate — not degrade — the property tax situation for these servicemen and women across the state.
For some disabled veterans in Canterbury, the version of Moffett’s bill that ended up becoming law is having the opposite effect.
“The intent of this was to help certain veterans,” said Moffett, who chairs the House Veterans Committee. “Obviously, I’ve learned that there are some issues. That’s something we need to look at.”
His bill’s original language gave cities and towns the option of altogether eliminating their disabled veterans’ property tax bill, stipulating that the tax credit could cover up to 100% of their property taxes.
Moffett himself is not a disabled veteran, but one had asked him directly to sponsor legislation to that effect. Although he’s sensitive to concerns about property tax breaks for special populations, he said, he obliged because “citizens need to know military service is valued by our communities and that disabled veterans will be taken care of.”
But by the time Moffett’s bill had made it through the Senate and been signed into law by Gov. Kelly Ayotte, it had morphed to cap the optional tax credit at $5,000, rather than covering 100% of a disabled veteran’s property taxes.
Another alteration was introduced during the legislative process, one preventing veterans from stacking their disability credit with other standard veteran credits. Language prohibiting stacking already existed in the law and predated Moffett’s bill. Nonetheless, stacking had occurred for years, and the law’s new language specifically stipulates certain tax credits that cannot be stacked on top of a disability tax credit.
In Canterbury, the change is costing some disabled veterans money — up to 15 veterans, by the town’s count.
Selectman Calvin Todd sees both sides of the equation. He said he’d like every veteran and every municipality caught in a cloud of confusion over the tax credit change to stay “whole,” with their bottom lines intact.
Todd, a disabled veteran himself, said he doesn’t fault Moffett or other legislators for trying to balance veterans’ interests and towns’ budgetary needs. The optional 100% tax exemption stipulated in the bill’s original wording could have withheld funding from the already meager coffers of any small towns that decided to opt in.
“For small towns like Canterbury, if we lost 15 taxpayers, at an average of $9,000 a piece, that’s a pretty substantial portion of the budget for small municipalities. It’s difficult to absorb that hit, you know, that’s a police cruiser,” Todd said.
Todd served in Afghanistan and realizes that the several-hundred-dollar difference the stacking prohibition imposes may represent a bigger financial burden for older veterans who served and became disabled in earlier wars.
As a selectman, he’s choosing to be proactive in addressing this change within his sphere of influence, leaving any future legislative changes up to the legislators.
For his part, Moffett said that if no senator takes action to change the law’s language in December, he will need to wait another year to introduce a new bill that remedies the stacking issue.
“I’m new to the warrant article process and how everything works, but we’re going to reach out to towns around our size, 3,000 people, and see how they’re going to absorb the credit,” Todd said. “Our biggest fear would be the tax bill comes, and by the way, you owe $500 more because this bill was passed.”