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By Tim Brown, Operations Manager, County Information Project |
The baby boom refers to the high birth rate in the post-World War II period from 1946 through 1964; the people born during that period are “Baby Boomers.” Much mention has been made in the last few years about how this generation is about to hit retirement age. The first baby boomers celebrated their 60th birthdays in 2006. To illustrate why policy makers are concerned, consider the following: from 2000 to 2005, the U. S. Census Bureau estimates the number of people in Texas age 65 and older increased by 75,317; over the same period, the number of people in the state age 55-59 increased by 268,265! As of 2005, an estimated 1,164,786 people age 55 to 59 were living in Texas as seen in the accompanying chart.
Anyone who is interested in the funding of our Social Security program and services for the elderly will be watching closely as this large generation reaches retirement age. County officials in particular need to keep an eye on this generation due to two recent initiatives. They are the 2003 constitutional amendment that allows entities other than schools to have an optional local property tax freeze for seniors and the more recent Government Accounting Standards Board (GASB) Statement 45.
The senior tax freeze will effectively shift a large part of the property tax burden to the younger generations and commercial properties. This will occur at the same time the state is seeing an increasing number of elderly residents who will depend more and more on governmental services. Much of the increased costs for services to the elderly will be paid for by local governments who must rely on the local property tax for their funding.
Meanwhile, GASB 45 has the potential to drastically increase each county’s tax levy. Briefly, this standard is a virtual mandate on local governments that requires funding of post-retirement healthcare obligations. See the article in this issue for more details on this new accounting standard.
