Issue No. 24-012 | August 23, 2024
Notable property tax developments:
- Colorado > As lawmakers prepare for a special session on property tax relief, the Colorado Secretary of State this week certified Initiative 108 for the November ballot. Initiative 108 would reduce the residential assessment ratio to 5.7% (and this would include multifamily properties) and reduce the commercial assessment ratio to 24%. Initiative 108 joins Initiative 50 (which previously was certified to the ballot) that would limit property tax revenue from increasing beyond 4% growth from the total statewide property tax revenue collected in the previous year. Statewide voter approval would be required to retain property tax revenue above the cap.
- Texas > Austin ISD called for a tax rate election to address a $119 million budget deficit, proposing a 10.6% increase in the tax rate. If approved, the new tax rate would generate $41 million annually, with nearly $18 million allocated for employee pay raises. This move aims to stabilize the district’s finances and support its staff and students. Read more here.
- National > The
Tax Foundation
's latest report on property taxes highlights significant variations in median property tax bills across U.S. counties and states. In 2022, the average property tax paid was $1,815, with notable disparities ranging from less than $250 in some counties to over $10,000 in others. The report underscores the reliance of local governments on property taxes for funding essential services. This comprehensive analysis provides valuable insights for policymakers and stakeholders in understanding and addressing property tax burdens. Read more here.
- Minnesota > The mayors of Minneapolis and St. Paul proposed property tax increases of approximately 8%, citing rising costs for public services and the impact of declining downtown property values. The reduction in commercial property values and increased office vacancies have shifted the tax burden to homeowners and renters. Despite these challenges, experts note that the overall impact on individual tax bills may be less significant than anticipated. This situation underscores the ongoing financial adjustments cities must make in response to evolving economic conditions. Read more here.
- Pennsylvania > Pittsburgh Public Schools filed a lawsuit against Allegheny County, seeking a court-ordered property reassessment to address an outdated and inequitable system. The district highlights that recent assessment cuts totaling $14 million have resulted in significant financial losses. These cuts, combined with previous reductions, have cost the city, the schools, and the county over $323,000 in tax revenue. This legal action underscores the ongoing challenges and financial pressures faced by educational institutions in the region. Read more here.
- Nebraska > Governor Jim Pillen signed a property tax relief package into law after a contentious 17-day special legislative session. The package includes budget cuts, an inflationary cap on budget increases for cities and counties, and $750 million for a property tax relief fund. However, much of the relief will come from an existing tax credit program, limiting its impact. The Governor acknowledged the package as a starting point and promised to seek additional relief in the future. Read more here.
Notable multifamily developments:
- Affordable Housing > Amazon expanded its Housing Equity Fund to $3.6 billion, aiming to create and preserve over 35,000 affordable homes in the Puget Sound, National Capital, and Nashville regions. This initiative supports moderate- to low-income families through below-market loans and grants, ensuring long-term affordability. Read more here.
- FHFA Housing Goals > The Federal Housing Finance Agency proposed new housing goals for Fannie Mae and Freddie Mac for 2025-2027. These goals aim to promote equitable access to affordable housing for low- and moderate-income families, minority communities, and other underserved populations. The proposal includes new compliance evaluation processes and benchmark levels that reflect current and forecasted economic factors. Public comments on the proposed rule are being accepted until October 21, 2024. Read more here.
- Election 2024 > Vice President Kamala Harris introduced a series of economic proposals aimed at increasing affordable housing. The plan includes the construction of 3 million new housing units over the next four years and offers tax incentives for homebuilders and down payment assistance for first-time buyers. These measures are designed to address the housing supply shortage and improve affordability for low- and moderate-income families. Read more here.
- Georgia > Invest Atlanta approved several key affordable housing initiatives aimed at bolstering housing availability in historically underserved neighborhoods. The initiatives include bonds and loans for new multifamily units in Brookview Heights, Dixie Hills, Collier Heights, and English Avenue. These projects are expected to create or rehabilitate hundreds of housing units for low- to moderate-income families. This strategic investment underscores the city’s commitment to addressing housing affordability and supporting community development. Read more here.
- Missing Middle Housing > A recent Zillow study reveals growing support for "middle housing" options, such as duplexes and small apartment buildings, in residential neighborhoods. The survey, covering 26 metro areas, found that 78% of homeowners and 91% of renters support at least one type of middle housing. This trend reflects a broader acceptance of modest densification measures to address the ongoing housing shortage. The study highlights the potential of middle housing to enhance housing supply and affordability. Read more here.
- Joe and Tracy speak with Tom Keene and Mike McKee on Chairman Powell's speech at the Jackson Hole economic symposium. Listen here.
