Four States to Decide on Property Tax Reduction Measures

In November, voters in four Republican-led states will decide on property tax reduction measures. States such as Florida, North Carolina, Oklahoma, and Wyoming have placed these proposals on the ballot in response to ongoing increases in property taxes that many homeowners across America find burdensome.

The Rising Property Tax Burden

Since the pandemic, housing costs have risen sharply. Historically low mortgage rates and the surge in remote work fueled a home-buying spree, increasing home values and property taxes. According to the Institute on Taxation and Economic Policy (ITEP), average annual property taxes for single-family homes have increased by 30% since 2019. Homeowners now pay a median of $3,119 annually.

Property data from ATTOM indicates that the average single-family home, valued at $494,231, incurred property taxes of $4,427 last year. This amount reflects a 3% increase from the previous year. Nationwide, the effective property tax rate for single-family homes reached 0.9% last year, the highest since 2020.

Homeowners, particularly seniors on fixed incomes, report difficulties in managing rising tax bills. In response, lawmakers, primarily in Republican-led states, aim to provide relief. However, local authorities express concern over potential revenue losses for local governments.

Ballot Measures in November

Each state offers distinct solutions to the issue of property taxes. Florida and Wyoming propose significant direct tax cuts. Oklahoma seeks to restrict assessment growth limits further, while North Carolina proposes a requirement for caps on property tax increases.

Florida

Florida voters will decide on a constitutional amendment known as Amendment 3. This amendment proposes to significantly expand the homestead exemption for primary residences. The exemption on nonschool property taxes would increase to $150,000 in 2027 and $250,000 in 2028. Additionally, the cap on annual assessment increases for non-homestead properties would decrease from 10% to 5%.

The proposal faces a legal challenge due to its “misleading language,” as noted by a judge. Critics argue it could severely reduce local government revenue and affect services like law enforcement. A constitutional amendment in Florida requires the support of at least 60% of voters to pass.

North Carolina

The North Carolina proposal involves amending the state constitution to require the General Assembly to legislate limits on property tax increases. The amendment itself does not specify caps, leaving these details to lawmakers. Advocates claim it will shield homeowners from significant tax hikes, while opponents worry about reduced funding for public services.

Oklahoma

In Oklahoma, voters will decide on tightening existing limits on annual increases in taxable property values. The proposal proposes lowering the cap on assessed-value growth for homesteads from 3% to 1.75% and for most other properties from 5% to 4%. Supporters argue it provides stable tax relief amidst rising home values. Critics warn of constrained funding for schools and local services.

Wyoming

Wyoming’s proposal marks the first citizen-initiated measure on the state ballot in three decades. It involves a 50% property tax exemption on a homeowner’s primary residence, where taxes would be levied on only half the home’s assessed value. Proponents view it as essential relief for homeowners and retirees. Opponents raise concerns about diminished revenue for local governments and schools.

If approved, the reform would extend Wyoming homeowners’ relief, building on the existing 25% property tax exemption on the first $1 million of a primary home’s fair-market value.