PETITION OF:

SECTION 1. To provide for a program of property tax relief by deferment for income eligible seniors over the age of 65 in the sum set forth in section 2, for the several purposes and subject to the conditions specified in this act, are hereby made available, subject to laws regulating the disbursement of public funds and the approval thereof.

SECTION 2.

EXECUTIVE OFFICE OF ADMINISTRATION AND FINANCE.

XXXX-XXXX

For funding to provide property tax relief for eligible seniors, the eligibility of said seniors set forth in section 5 of this act.

........................................$30,000,000

SECTION 3. To meet a portion of the expenditures necessary in carrying out section 2, the state treasurer shall, upon request of the governor, issue and sell bonds of the commonwealth in an amount to be specified by the governor from time to time, but not exceeding, in the aggregate, $30,000,000. All bonds issued by the commonwealth as aforesaid shall be designated on their face, Senior Tax Relief Act of 2005, and shall be issued for such maximum term of years, not exceeding 20 years, as the governor may recommend to the general court pursuant to Section 3 of Article LXII of the Amendments to the Constitution; provided, however, that all such bonds shall be payable not later than June 30, 2025. All interest and payments on account of principal of such obligations shall be payable from the Senior Tax Relief Fund. Bonds and interest thereon issued under the authority of this section shall be general obligations of the commonwealth; provided, however, that any bonds issued by the state treasurer pursuant to this section shall, upon the request of the governor, be issued as special obligation bonds pursuant to section 2O of chapter 29 of the General Laws; provided further, that in deciding whether to request the issuance of particular bonds as special obligations, the governor shall take into account: (i) generally prevailing financial market conditions; (ii) the impact of each approach on the overall capital financing plans and needs of the commonwealth; (iii) any ratings assigned to outstanding bonds of the commonwealth and any ratings expected to be assigned by any nationally-recognized credit rating agency to the bonds proposed to be issued; and (iv) any applicable provisions of a trust agreement or credit enhancement agreement entered into pursuant to said section 2O. All special obligation revenue bonds issued pursuant to this section shall be designated on their face, Special Obligation Revenue Senior Tax Relief Act of 2005, and shall be issued for a maximum term of years, not exceeding 20 years, as the governor may recommend to the general court pursuant to Section 3 of Article LXII of the Amendments to the Constitution of the Commonwealth; provided, however, that all such bonds shall be payable not later than June 30, 2025. All interest and payments on account of principal on such obligations shall be payable from the Infrastructure Fund established in said section 2O of said chapter 29. Special obligation bonds issued pursuant to this section shall be special obligations of the commonwealth payable solely in accordance with said section 2O of said chapter 29.

SECTION 4. Bonds issued as special obligation bonds pursuant to this act shall not be included in the computation of outstanding bonds for purposes of the limit imposed by the second paragraph of section 60A of chapter 29 of the General Laws, nor shall debt service with respect to such bonds be included in any computation of the limit imposed by section 60B of said chapter 29.

SECTION 5. Chapter 10 of the General Laws, as most recently amended by section 1 of chapter 210 of the acts of 2004, is hereby amended by adding after section 35BB the following new section:-

Section 35CC. There shall be established and set up on the books of the commonwealth a separate fund to be known as the Senior Tax Relief Fund to be used, without appropriation, by the department of revenue for the purpose of making payments to cities and towns pursuant to clause 41^stA of section 5 of chapter 59. Revenues from the issuance and sale of bonds pursuant to sections 1 through 4, inclusive, of chapter [##] of the acts of 2005, and the recovery of deferred real property taxes pursuant to said clause 41^stA of said chapter 59 shall be deposited into the fund. All monies deposited into this fund shall be expended exclusively for the purpose set forth in this section.

SECTION 6. Section 5 of chapter 59 of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by striking out clause forty-first A and inserting in place thereof the following clause:-

Forty-first A, Real property, to an amount determined as hereinafter provided, of a person 65 years of age or over, and occupied by him as his domicile, of a person who owns the same jointly with his spouse, either of whom is 65 years of age or over, and occupied as their domicile, or of a person who owns the same jointly or as a tenant in common with a person not his spouse and occupied by him as his domicile; provided, that such person has been domiciled in the commonwealth for the preceding 10 years and

(1) has so owned and occupied as his domicile such real property or other real property in the commonwealth for 5 years; or
(2) is a surviving spouse who inherits such real property and has occupied such real property or other real property in the commonwealth as his or her domicile for 5 years and who otherwise qualifies under this clause; and provided further, that such person, and such person and his spouse, if married, had, during the preceding year, gross receipts from all sources not in excess of the dollar amount calculated to be the income limits on a taxpayer’s total income for a single individual who is not the head of a household for the purposes of paragraph (3) of subsection (k) of section 6 of chapter 62 for the most recently completed state tax year, as determined by the commissioner.

In determining the total period ownership of an applicant for exemption under this clause, the time during which the same property was owned by a husband or wife individually shall be added to the period during which such property was owned by the husband and wife jointly. In computing the gross receipts of such an applicant or of such an applicant and his spouse, if married, ordinary business expenses and losses may be deducted but not personal and family expenses.

Any such person may, on or before December 15 of each year to which the tax relates or within 3 months after the date on which the bill or notice is first sent, whichever is later, apply to the department for an exemption of all or part of such real property from taxation during such year; provided, however, that in the case of real estate owned by a person jointly or as a tenant in common with a person not his spouse, the exemption shall not exceed that proportion of total valuation which the amount of his interest in such property bears to the whole tax due. The department shall grant such exemption provided that the owner or owners of such real property have entered into a tax deferral and recovery agreement with the department on behalf of the city or town. The agreement shall provide:

(1) that no sale or transfer of such real property may be consummated unless the taxes which would otherwise have been assessed on such portion of the real property as is so exempt have been paid, with interest at the rate of the federal short-term rate determined under section 6621(b) of the Internal Revenue Code, as amended and in effect for the taxable year, plus 1 and 1/2 percentage points, per annum;

(2) that the total amount of such taxes due, plus interest, for the current and prior years does not exceed 50 per cent of the owner’s proportional share of the full and fair cash value of such real property;
(3) that upon the demise of the owner of such real property, the heirs-at-law, assignees or devisees shall have first priority to the real property by paying in full to the department the total taxes which would otherwise have been due, plus interest; provided, however, if such heir-at-law, assignee or devisee is a surviving spouse who enters into a tax deferral and recovery agreement under this clause, payment of the taxes and interest due shall not be required during the life of such surviving spouse. Any additional taxes deferred, plus interest, on the real property under a tax deferral and recovery agreement signed by a surviving spouse shall be added to the taxes and interest which would otherwise have been due, and the payment of which has been postponed during the life of such surviving spouse, in determining the 50 per cent requirement of subparagraph (2);
(4) that if the taxes due, plus interest, are not paid by the heir-at-law, assignee or devisee or if payment is not postponed during the life of a surviving spouse, such taxes and interest shall be recovered from the estate of the owner; and
(5) that any joint owner or mortgagee holding a mortgage on such property has given written prior approval for such agreement, which written approval shall be made a part of such agreement.

In the case of each tax deferral and recovery agreement entered into between the department and the owner or owners of such real property, the department shall forthwith cause to be recorded in the registry of deeds of the county or district in which the property is situated a statement of their action which shall constitute a lien upon the land covered by such agreement for such taxes as have been assessed under this chapter, plus interest as hereinafter provided. A lien filed pursuant to this section shall be subsequent to any liens securing a reverse mortgage, excepting shared appreciation instruments. The statement shall name the owner or owners and shall include a description of the land adequate for identification. Unless such a statement is recorded the lien shall not be effective with respect to a bona fide purchaser or other transferee without actual knowledge of such lien. The filing fee for such statement shall be paid by the owner or owners of such real property.
In addition to the remedies provided by this clause, the recorded statement of the department provided for in this clause shall have the same force and effect as a valid taking for nonpayment of taxes under section 53 of chapter 60, except that: (1) interest shall accrue at the rate determined under this clause for each year until the conveyance of the property or the death of the person whose taxes have been deferred, after which time interest shall accrue at the rate provided in section 62 of chapter 60; and (2) no petition under section 65 of chapter 60 to foreclose the lien may be filed before the expiration of six months from the conveyance of the property or the death of the person whose taxes have been deferred.

Following the recording of a tax deferral and recovery agreement pursuant to this clause, the commissioner shall certify in writing to the assessors of the city or town in which the owner or owners of such real property reside that said owner or owners have qualified for and have entered into a tax deferral and recovery agreement with the department pursuant to this clause. After such certification, for each year that said agreement is effective, the commissioner shall authorize a payment to the treasurer of said city or town from the senior tax relief fund, established under section 35CC of chapter 10, of an amount equal to the real estate tax owed on such real property on the day taxes are normally due and payable in said city or town.