NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature. The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.
The LFC is only preparing FIRs on bills referred to the Senate Finance Committee, the Senate Ways and Means Committee, the House Appropriations and Finance Committee and the House Taxation and Revenue Committee. The chief clerks are responsible for preparing and issuing all other bill analyses.
Only the most recent FIR version, excluding attachments, is available on the Intranet. Previously issued FIRs and attachments may be obtained from the LFC office in Room 416 of the State Capitol Building.
| SPONSOR: | Lujan | DATE TYPED: | 02/24/99 | HB | 682 | ||
| SHORT TITLE: | Reduce Property Tax Ratio | SB | |||||
| ANALYST: | Taylor | ||||||
| Subsequent
Years Impact |
Recurring
or Non-Rec |
Fund
Affected | ||
| FY99 | FY2000 | |||
| N/A | Uncertain | Uncertain | Recurring | State G.O.
Bonding |
| N/A | Uncertain | Uncertain | Recurring | Local Gov. Bonding |
| N/A | Uncertain | Uncertain | Recurring | Local Gov.
Operating |
(Parenthesis ( ) Indicate Revenue Decreases)
_______________________________________________________________________________________
SOURCES OF INFORMATION
Taxation and Revenue Department (TRD)
SUMMARY
Synopsis of Bill
House Bill 682 proposes a phased reduction in the ratio used determine the share of the assessed property value that is subject to property taxation. In tax year 2000 the ratio is decreased from its current level of 33 percent to 30 percent; in tax year 2001 the ratio is further decreased to 28 percent; and in tax year 2002 (and years thereafter), the ratio is reduced to 25 percent.
FISCAL IMPLICATIONS
The Taxation and Revenue Department reports that for local governments the impacts of the bill are uncertain. This is because while the bill would lower the taxable value of properties throughout the state, it would not be binding for local governments that have not used all their millage rates available to them. In other words, many local governments could offset the effect of a lower tax base by increasing the tax rate. However, local governments that have used all the mill rates available and do not have a property tax base that is expanding due to growth would be required to curtail operational spending and their capital programs. (For a more complete discussion of the possible impacts to local governments see the TRD FIR.)
The impact to the state's G.O. bonding program is certainly one of slower growth. How much slower depends on how the property tax base grows due to new construction and changes in assessed values.
BT/prr