COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:1949H.01I Bill No.:HJR 52 Subject:Veterans; Taxation and Revenue - General; Taxation and Revenue - Property;
Department of Revenue; Constitutional Amendments
Type:Original Date:April 17, 2023Bill Summary:This joint resolution proposes a constitutional amendment granting property
tax exemptions to certain disabled veterans.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2024FY 2025FY 2026
General Revenue$0 or (More than
$10,000,000)$0
$0 or
Could exceed
$946,152
Total Estimated Net
Effect on General
Revenue
$0 or (More than
$10,000,000)$0
$0 or
Could exceed
$946,152
*The potential fiscal impact of “(More than $10,000,000)” would be realized only if a special
election were called by the Governor to submit this joint resolution to voters. All other impacts
to state funds would be realized only if the joint resolution is approved by voters.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026
Blind Pension Fund
(0621)* $0$0
$0 or could exceed
($184,532 to
$348,246)
Total Estimated Net
Effect on Other State
Funds $0$0
$0 or could exceed
($184,532 to
$348,246)
*Oversight notes this proposal exempts qualifying veterans from both real and personal property
tax. B&P’s estimated fiscal impact only includes the reduction of revenue from real property tax
exemptions. Oversight assumes the actual fiscal impact to the BPF could exceed the estimates
above.
Numbers within parentheses: () indicate costs or losses. L.R. No. 1949H.01I
Bill No. HJR 52
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April 17, 2023
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on FTE 000
☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☒ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Local Government
$0*$0
$0 or could exceed
($31,392,253 to
$59,242,850)**
*Potential costs and state reimbursements net to zero in FY 2024 if a special election is called.
**Oversight notes this impact could be substantially reduced if taxing authorities are able to
increase the levy to other taxpayers to make up for the loss of property tax revenue of disabled
veterans resulting from this proposal. Oversight notes this proposal exempts qualifying veterans
from both real and personal property tax. B&P’s estimated fiscal impact only includes the
reduction of revenue from real property tax exemptions. Oversight assumes the actual fiscal
impact could exceed the estimates above. L.R. No. 1949H.01I
Bill No. HJR 52
Page 3 of
April 17, 2023
KLP:LR:OD
FISCAL ANALYSIS
ASSUMPTION
Officials from the Department of Revenue (DOR) note if approved by voters at the November
2024 general election or at a special election called for this purpose, this proposal would allow
for an exemption of real property tax for military disabled veterans. If this is not adopted by the
voters, there will be no fiscal impact. If adopted, it is assumed that based on the certification
date and the wording of this proposal, it would become effective January 1, 2025.
This proposal creates a phased out exemption based on the disability rating as established by the
by the United States Department of Veterans Affairs. Ratings and exemption per the proposal. If
a disabled veteran has a disability of 70% or more than all their property would be exempt from
property tax. This will impact personal and real property taxes.
Disability RatingDollar Amount (or the Total Assessed
Property Valuation) Exempt from
Taxation
30% to 49%$2,50050% to 69%$5,00070% to 100%100% of all property is exempt from
tax
Per the U.S. Census Bureau’s 2021 ACS 5 year report, there are 32,771 disabled veterans in
Missouri with a rating of 70% or higher. The Department reached out to the Missouri Veterans
Commission who was not able to provide more recent information on disabled veterans than
2019.
Per the Census Bureau the following are the number of veterans per rating.
Rating Number of Veterans30% to 40%13,28950% to 60%11,53470% to 100%32,771Total57,594
According to the data above, more than 13,289 veterans would be exempt up to $2,500 in
assessed valuation from tax, more than 11,534 would exempt up to $5,000 in assessed valuation
from tax and less than 32,771would be exempt from all property tax.
The Department is unable to determine the actual number of veterans that would own their own
property. For fiscal notes purposes, DOR will assume all of these veterans own their own
dwelling (57,594). The Census Bureau report identified how many veterans were in each county
with Wright County having the least at 132 and St. Louis County having the most with 54,877. L.R. No. 1949H.01I
Bill No. HJR 52
Page 4 of
April 17, 2023
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Property tax varies by county, but the State Tax Commission’s 2021 Annual Report said the
average amount paid in residential real property tax was $1,690.
This proposal will be based on the assessed value of the property, which can vary by property
size and location in the state. The Department notes that some veterans will qualify for a lesser
amount of the exemption due to a lower disability rating so the impact may be overstated.
Additionally, this would exempt their personal property taxes as well and the Department is
unable to estimate that amount and therefore the estimate may be understated. For the fiscal
note, DOR will assume this would exempt from state and local real and personal property tax
$97,333,860 ($1,690 per person x 57,594 veterans).
The Missouri Blind Pension fund receives $.03 for each $100 valuation of taxable property in the
state of Missouri. The Department is unable to determine the actual valuation of the taxable
property owned by Missouri veterans, as there are no publications specifying assessed value of
property owned by Missouri veterans.
The Department estimates that the Missouri Blind Pension Fund could decrease by a minimum to
substantial amount.
Additionally, DOR notes that if a military disabled veteran is exempt from paying real property
tax, they would no longer be eligible to claim the Senior Property Tax Credit. Currently a person
can claim the Senior Property Tax Credit if:
A. They are 65 years or older;
B. 100% Disabled Veteran as a result of military service;
C. 100% Disabled; or
D. 60 years of age or older and receiving surviving spouse benefits
In TY 2020 – 1,203 taxpayers checked the disable veteran box on the PTC form. They claimed
$866,551 in property tax credits.
In TY 2021 – 1,241 taxpayers checked the disable veteran box on the PTC form. They claimed
$946,152 in property tax credits.
Two year average claimed by disabled veterans is $906,352.
DOR notes that if a disabled veteran is also over the age of 65 years of age they may have just
checked the 65+ box instead of the Veterans box so the amount that could be exempt could be
higher.
DOR assumes this would result in a savings to General Revenue that Could Exceed $906,352
annually from military veterans no longer owing real property tax and being ineligible for the
property tax credit. L.R. No. 1949H.01I
Bill No. HJR 52
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April 17, 2023
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Given the election for this proposal is November 2024 (FY 2024) and the bill starts with property
taxes on January 1, 2025; this proposal will have an impact starting in FY 2026 due to the filing
deadline for the taxes being 12/31/2025 (FY 2026).
FY 2024 $0
FY 2025 $0
FY 2026 $906,352 savings to GR and an Unknown loss to Blind Pension fund
This proposal will not have an administrative fiscal impact on the Department.
Officials from the Office of Administration - Budget and Planning (B&P) note this proposal
would go to public vote in November 2024. If voter approved, the tax exemption would begin
January 1, 2025.
Section 6.1 would expend the current property tax exemption for POWs from only those with a
total service connected disability, to all POWs.
Section 6.5 would grant qualifying veterans with a service-connected disability a property tax
exemption based on the level of their service connected disability. This property tax exemption
would begin for tax year 2025. B&P notes that property taxes are due by December 31
st
of a tax
year. Therefore, this proposal would begin impacting state and local revenues in FY26.
B&P notes that the property tax exemption granted under this proposal depends on a qualifying
veterans service connected disability rating. Table 1 shows the property tax exemption by rating.
Table 1: Exemption PercentageDisability
Rating
Property Tax
Exemption
30% - 49%$2,500 50% - 69%$5,000 70% - 100%100% of tax liability
Based on data published by the U.S. Census Bureau, there were 57,594 veterans residing in
Missouri with a disability rating of 30% or more. Using 2021 PTC data, B&P notes that of those
claiming the PTC as a disabled veteran, 53% owned their home. Table 2 shows the total number
of veterans and the estimated number that may own homes based on PTC data.
Table 2: Estimated Veterans
Disability Rating
#
Veterans
Est.
Owners
30% - 49%13,2897,04250% - 69%11,5346,11270% - 100%32,77117,365Total57,59430,519 L.R. No. 1949H.01I
Bill No. HJR 52
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April 17, 2023
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However, B&P notes that the PTC has a low-income limit in order to qualify. It is possible that
the homeownership rate among the full population of veterans is higher. Therefore, B&P will
estimate the impact from the proposal using a range of 53% - 100% veteran homeownership.
Based on additional data published by the U.S. Census Bureau, the median home value in 2021
was $171,800 and the median real estate taxes paid was $1,676. B&P notes that for veterans
with a disability rating between 20% and 69%, this proposal provides an exemption off their
assessed value. For veterans with a disability rating greater than 69%, this proposal would
exempt all assessed value from taxation. B&P further notes that residential real property is
assessed at 19% of the market value. Therefore, B&P estimates that the median assessed value
for residential property in Missouri was $32,642 ($171,800 x 19%) during 2021. Under this
proposal, the median assessed value for a veteran with a services connected disability of 30%-
49% would now be $30,142 ($32,642 - $2,500). The median value for a veteran with a services
connected disability of 50%-69% would now be $27,642 ($32,642 - $5,000). The median value
for a veteran with a services connected disability of 70% and greater would be $0 ($32,642 x
100%). Table 3 shows the estimated median property tax reduction per veteran.
Table 3: Estimated Property Tax Reduction per
Veteran
Disability
Rating
Exemption
Est. Tax
Reduction
30% - 49%$2,500 ($128.36)50% - 69%$5,000 ($256.73)70% -
100%
100% of tax
liability($1,676.00)
Using the above estimates and the number of qualifying veterans, B&P estimates that this could
reduce state and local property tax revenues by $31,576,785 to $59,591,096 annually. Table 4
shows the estimated total state and local impact.
Table 4: Estimated Property Tax Loss
Disability Rating
Low
Ownership
High
Ownership
30% - 49%($903,911)($1,705,776)50% - 69%($1,569,134)($2,961,124)70% - 100%($29,103,740)($54,924,196)Total($31,576,785)($59,591,096)
B&P notes that the Blind Pension Trust Fund levies a statewide property tax rate of $0.03 per
$100 valuation. B&P estimates that of the $1.676 median property tax paid, $9.79 goes to the
Blind Pension Trust Fund and $1,666 goes to local funds. Using the number of qualifying
veterans above, B&P estimates that this proposal could reduce Blind Pension revenues by L.R. No. 1949H.01I
Bill No. HJR 52
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April 17, 2023
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$184,532 to $348,246 annually. This proposal could also reduce local property tax revenues by
$31,392,253 to $59,242,850 annually.
In addition, during tax year 2021 there were 1,241 veterans that claimed the PTC as a disabled
veteran and property owner, for total PTC claims of $946,152. Under this proposal some, or all,
of their property would now be exempt from property tax. Therefore, B&P estimates that this
provision could increase GR by up to $946,152 annually beginning in FY26.
Therefore, B&P estimates that this proposal could increase TSR by less than $382,157 to
$647,292 annually beginning in FY26. In addition, this proposal could decrease local revenues
by $50,850,984 to $95,963,549. Table 4 shows the total state and local impact.
Table 4: Estimated State and Local Property Tax Loss Low OwnershipHigh OwnershipState General RevenueUp to $946,152Up to $946,152Blind Pension Trust Fund($184,532)($348,246)Total State ImpactLess than $761,620 Less than $597,906 Local Median Loss($31,392,253)($59,242,850)
Officials from Office of the Secretary of State assume, each year, a number of joint resolutions
that would refer to a vote of the people a constitutional amendment and bills that would refer to a
vote of the people the statutory issue in the legislation may be considered by the General
Assembly.
Unless a special election is called for the purpose, Joint Resolutions proposing a constitutional
amendment are submitted to a vote of the people at the next general election. Article XII section
2(b) of the Missouri Constitution authorizes the governor to order a special election for
constitutional amendments referred to the people. If a special election is called to submit a Joint
Resolution to a vote of the people, section 115.063.2 RSMo requires the state to pay the costs.
The cost of the special election has been estimated to be $10 million based on the cost of the
2022 primary and general election reimbursements.
The Secretary of State’s office is required to pay for publishing in local newspapers the full text
of each statewide ballot measure as directed by Article XII, Section 2(b) of the Missouri
Constitution and Section 116.230-116.290, RSMo. Funding for this item is adjusted each year
depending upon the election cycle. A new decision item is requested in odd numbered fiscal
years and the amount requested is dependent upon the estimated number of ballot measures that
will be approved by the General Assembly and the initiative petitions certified for the ballot. In
FY 2014, the General Assembly changed the appropriation so that it was no longer an estimated
appropriation. L.R. No. 1949H.01I
Bill No. HJR 52
Page 8 of
April 17, 2023
KLP:LR:OD
For the FY24 petitions cycle, the SOS estimates publication costs at $70,000 per page. This
amount is subject to change based on number of petitions received, length of those petitions and
rates charged by newspaper publishers.
The Secretary of State’s office will continue to assume, for the purposes of this fiscal note, that it
should have the full appropriation authority it needs to meet the publishing requirements.
Because these requirements are mandatory, the SOS reserves the right to request funding to meet
the cost of the publishing requirements if the Governor and the General Assembly again change
the amount or continue to not designate it as an estimated appropriation.
Oversight has reflected, in this fiscal note, the state potentially reimbursing local political
subdivisions the cost of having this joint resolution voted on during a special election in fiscal
year 2024. This reflects the decision made by the Joint Committee on Legislative Research that
the cost of the elections should be shown in the fiscal note. The next scheduled statewide
primary election is in August 2024 and the next scheduled general election is in November 2024
(both in FY 2025). It is assumed the subject within this proposal could be on one of these ballots;
however, it could also be on a special election called for by the Governor (a different date).
Therefore, Oversight will reflect a potential election cost reimbursement to local political
subdivisions in FY 2024.
Officials from the State Tax Commission have reviewed this proposal and determined an
unknown fiscal impact. The U.S. Census Survey (2018) states the number of veterans in
Missouri is 479,828 of which over 80,000 have service-related disabilities. The Agency does not
possess the data to determine the number of qualifying, eligible individuals under the proposed
criteria or how many of these individuals own real and personal property or the potential fiscal
impact from said exemption on the 2,900 local taxing jurisdictions such as school and fire
districts, cities, counties who rely on property taxes for revenue.
Officials from the City of Jefferson City assume this proposal would have a negative fiscal
impact, city officials were unable to estimate the number of disabled veteran property owners
there are in Jefferson City, so they cannot calculate the estimated fiscal impact.
Officials from the City of Kansas City assume this proposal could have a negative fiscal impact
on Kansas City in an indeterminate amount.
Officials from the City of Kansas City Health Department assume this proposal could have a
negative fiscal impact on Kansas City in an indeterminate amount.
Officials from the City of Springfield anticipate a negative fiscal impact of an undetermined
amount.
Officials from the Newton County Health Department assume this proposal will create a
negative fiscal impact on the Newton County Health Department in the difference in the amount
previously collected before exemption and the amount collected after exemption. L.R. No. 1949H.01I
Bill No. HJR 52
Page 9 of
April 17, 2023
KLP:LR:OD
Officials from the St Louis County Health Department assume this proposal will create a
reduction of property taxes would reduce revenue for the health department. The amount of the
revenue loss is not known.
Officials from the Lincoln County Assessor assume this proposal would create a tax burden
shift to those that do not receive the exemption - possible tax levy increases to offset any
assessment value losses.
Officials from the St. Charles Community College - 2 assume the proposal will have no fiscal
impact on their organization.
Oversight notes the above local political subdivisions stated this proposal would have a negative
fiscal impact on their respective cities of an indeterminate amount. Oversight notes contingent on
voter approval, this exemption may decrease property tax revenue to local political subdivisions.
Oversight notes this impact could be substantially reduced if taxing authorities are able to
increase the levy to other taxpayers to make up for the loss of property tax revenue of disabled
veterans resulting from this proposal. Therefore, Oversight will note B&P and DOR’s estimates
for all local political subdivisions on the fiscal note.
Oversight received a limited number of responses from local political subdivisions related to the
fiscal impact of this proposal. Oversight has presented this fiscal note on the best current
information available. Upon the receipt of additional responses, Oversight will review to
determine if an updated fiscal note should be prepared and seek the necessary approval to
publish a new fiscal note.
Oversight only reflects the responses received from state agencies and political subdivisions;
however, other local political subdivisions were requested to respond to this proposed legislation
but did not. A listing of political subdivisions included in the MOLIS database is available upon
request.
Officials from the Department of Social Services, Department of Public Safety – Veterans
Commission, and the Office of the State Auditor each assume the proposal will have no fiscal
impact on their respective organizations. Oversight does not have any information to the
contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for these agencies.
Oversight assumes that if adopted, it is assumed that based on the certification date of this
proposal, it would become effective January 1, 2025. Oversight will use estimates provided by
B&P.
Oversight notes based on data published by the U.S. Census Bureau, there were 57,594 veterans
residing in Missouri with a disability rating of 30% or more. Based on additional data published
by the U.S. Census Bureau, Oversight notes the median home value in 2021 was $171,800 and L.R. No. 1949H.01I
Bill No. HJR 52
Page 10 of 13
April 17, 2023
KLP:LR:OD
the median real estate taxes paid was $1,676. Oversight will show the number of total veterans
by disability rating in the table below.
Disability Rating# Veterans30% - 49%13,28950% - 69%11,53470% - 100%32,771Total57,594
Oversight notes according to the Veterans Benefits Administration, 16.9% of disabled veterans
have a 100% disability rating. Therefore, of the 32,771 with a 70%-100% disability rating,
Oversight assumes 9,733 already are exempt from property taxes, leaving 23,038 veterans who
would be exempt from real and personal property taxes under this proposal.
Assuming a tax levy of $5.25, Oversight will show the estimated impact to real property tax
revenue by disability rating in the table below.
Real Property Tax
Disability
Rating
#
Veterans
Exemption
Assessed
valuation exempt
from tax
Estimated Real
Property Tax
Loss to Locals
(5.25)
Estimated Real
Property Tax Loss
to Blind Pension
Fund
30% -
49%
13,289$2,500
$
33,222,500 $1,744,181
$9,967 50% -
69%
11,534$5,000
$
57,670,000 $3,027,675
$17,301
70% -
99%
23,038
(Not
already
Exempt)
100% of
tax
liability
100% $38,611,688
$220,638
Total47,861$43,383,544 $247,906
*Oversight notes the above estimates assume all 57,594 veterans own their homes, therefore the
estimate could be overstated.
Oversight notes this proposal would exempt personal property as well. Assuming an average
personal property tax liability of $500 per veteran, Oversight assumes a loss in personal property
tax revenue of $11,519,000 ($500 * 23,038) to local political subdivisions and a loss of $65,823
to the Blind Pension Fund ($11,519,000 / .0525 * 0.0003).
Oversight notes that the Blind Pension Trust Fund levies a statewide property tax rate of $0.03
per $100 valuation. B&P estimates that of the $1.676 median property tax paid, $9.79 goes to
the Blind Pension Trust Fund. Oversight shows the estimated impact to the Blind Pension Fund
in the table below. L.R. No. 1949H.01I
Bill No. HJR 52
Page 11 of 13
April 17, 2023
KLP:LR:OD
Tax Type Blind
Pension:
Real $247,906 Personal $65,823Total $313,729
Oversight notes this proposal is contingent on a voter approved amendment to the Constitution.
Oversight will show the impact as either $0 (Constitutional amendment is not approved by voters
AND/OR the local political subdivisions may be able to increase the levy to all other taxpayers
to replace the lost property tax revenues from disabled veterans) or could exceed the figures
estimated by DOR and B&P to the Blind Pension Fund and local political subdivisions beginning
in FY 2026.
FISCAL IMPACT – State GovernmentFY 2024
(10 Mo.)
FY 2025FY 2026GENERAL REVENUERevenue Gain – DOR – Veterans no
longer claiming the Senior Property
Tax Credit $0$0
$0 or
Could exceed
$946,152
Transfer Out - SOS - reimbursement of
local election authority election costs if
a special election is called by the
Governor
$0 or (More
than
$10,000,000)$0$0
ESTIMATED NET EFFECT ON
GENERAL REVENUE
$0 or (More
than
$10,000,000)$0
$0 or
Could exceed
$946,152
BLIND PENSION FUNDRevenue Loss - Reduction in real
property tax collected from veterans
with a service-connected disability
$0$0
$0 or could
exceed
($184,532 to
$348,246)
ESTIMATED NET EFFECT ON
BLIND PENSION FUND$0$0
$0 or could
exceed L.R. No. 1949H.01I
Bill No. HJR 52
Page 12 of 13
April 17, 2023
KLP:LR:OD
($184,532 to
$348,246)
FISCAL IMPACT – Local GovernmentFY 2024
(10 Mo.)
FY 2025FY 2026LOCAL POLITICAL
SUBDIVISIONSCosts – to implement and monitor$0$0$0 or (Unknown)
Revenue Loss – Reduction in real
property tax collected from veterans
with a service-connected disability*
$0$0
$0 or could
exceed
($31,392,253 to
$59,242,850)
Transfer In - Local Election Authorities
- reimbursement of election costs by the
State for a special election
$0 or More
than
$10,000,000
$0$0
Costs - Local Election Authorities - cost
of a special election if called for by the
Governor
$0 or (More
than
$10,000,000)$0$0
ESTIMATED NET EFFECT ON
LOCAL POLITICAL
SUBDIVISIONS
$0$0
$0 or could
exceed
($31,392,253 to
$59,242,850)
*Oversight notes this impact could be substantially reduced if taxing authorities are able to
increase the levy to other taxpayers to make up for the loss of property tax revenue of disabled
veterans resulting from this proposal. Oversight notes this proposal exempts qualifying veterans
from both real and personal property tax. B&P’s estimated fiscal impact only includes the
reduction of revenue from real property tax exemptions. Oversight assumes the actual fiscal
impact could exceed the estimates above.
FISCAL IMPACT – Small Business
Oversight assumes there could be an impact to small businesses owned by qualifying veterans
with a service-connected disability. Conversely, taxing jurisdictions may be able to increase the
levy to all other property owners to make up for the lost revenue. L.R. No. 1949H.01I
Bill No. HJR 52
Page 13 of 13
April 17, 2023
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FISCAL DESCRIPTION
Upon voter approval, this Constitutional amendment would, beginning January 1, 2025, exempt
from taxation the property of certain disabled veterans as follows:
(1) Veterans assigned a disability rating of 30% to 49% shall have $2,500 of their total assessed
property valuation exempt from taxation;
(2) Veterans assigned a disability rating of 50% to 69% shall have $5,000 of their total assessed
property valuation exempt from taxation; and
(3) Veterans assigned a disability rating of 70% to 100% shall have all of the value of their total
assessed property exempt from taxation.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Office of Administration - Budget and Planning
Department of Revenue
Department of Public Safety – Veterans Commission
Department of Social Services
Office of the Secretary of State
Office of the State Auditor
State Tax Commission
Newton County Health Department
St. Louis County Health Department
Kansas City Health Department
Lincoln County Assessor
St. Charles Community College - 2
City of Springfield
City of Kansas City
City of Jefferson City
Julie MorffRoss StropeDirectorAssistant DirectorApril 17, 2023April 17, 2023