MONTGOMERY, Ala. – A bill to cap annual property tax increases was approved in an Alabama House committee meeting on Wednesday, but changes are expected when it’s debated on the House floor.
House Bill 73 by Rep. Phillip Pettus, R-Killen, would limit annual tax hikes by capping increases on annual assessments of property. There is currently no such cap on how much someone’s property taxes might increase year-to-year.
Earlier this year, Pettus told Alabama Daily News recent, drastic property tax increases are a major concern of constituents.
As approved in committee Wednesday, Class III properties, which include single-family homes and land used for agricultural production, and Class II properties, which include commercial and business properties, would be capped at 5% per year.
But groups representing local governments and public education are concerned the bill will mean less funding for their entities. They’ve been in discussions with Pettus recently.
“We’re still working, but we’ve agreed to go with it like it is and before I bring it on the floor we will have (an agreed upon version,)” Pettus said in committee Wednesday.
A fiscal note on the bill says it will cut revenue to state and local governments and schools by about $67 million per year.
Sonny Brasfield, executive director of the Association of County Commissions of Alabama, told the committee that with another amendment, the bill will be ready for consideration in the House.
The caps wouldn’t apply to property never assessed, property with major improvements including new construction or changes in ownership.
As originally filed, the bill had more than 20 co-sponsors.
Sen. David Sessions, R-Grand Bay, is sponsoring the same bill in the Senate, where it has 25 co-sponsors.