The committee reviewed 26LSO103, a draft bill to implement the constitutional requirement created by Amendment A and to set a residential real property assessment rate at 8.3 percent.
LSO explained the draft would add a new property category — "residential real property" — defined to include dwellings for up to three families and associated residential land owned by the dwelling owner, and set the taxable value (assessment rate) for that class at 8.3 percent effective January 1, 2026.
Ken Gill of the Department of Revenue said the department's systems can accommodate the 8.3% rate and that the definition generally matches the State Board of Equalization's abstracts: "3 family and under is residential. 4 family and up is commercial." He noted potential complexity where land and improvement titles differ (for example, house owned in one name and land in another) and for improvements on leased federal or state lands; those situations will require abstract-code mapping to ensure the right assessment tier applies.
Fiscal context: staff referenced numbers from prior legislation (House Bill 328 from the previous session) showing a prior impact tied to residential valuation changes: roughly $55.1 million to the School Foundation Program and $27.9 million to local entities in the prior analysis. Committee members asked the Department and fiscal staff to produce a county-by-county fiscal impact estimate and a clearer fiscal note for the proposal before making further choices.
Outcome: the committee did not vote on the bill and instead requested a county-level cost breakdown and an updated fiscal note. Members indicated they will review the detailed fiscal analysis at the November meeting.
Ending: staff and the Department will return with refined fiscal estimates and with a review of definition edge cases (multi-family thresholds and ownership-title mismatches) to help finalize drafting.