Doña Ana County staff detail budget impact of House Bill 47 veterans exemptions

Doña Ana County budget staff presented an impact analysis of House Bill 47 on county property-tax revenue, telling the County Commission the bill raises the basic veteran exemption from $4,000 to $10,000 beginning with tax year 2025 and creates a percentage-based disabled-veteran exemption effective in tax year 2026.

Lucio Luttrell, Budget and Research Officer, told commissioners the bill amends two statutory provisions: section 7-37-5 (veteran exemption) and section 7-37-5.1 (disabled veteran exemption). "Currently, that exemption amount is $4,000 but that amount will now be $10,000 beginning tax year 2025," Luttrell said. He added that the $10,000 exemption will be adjusted by the consumer price index in subsequent years.

Luttrell said the disabled-veteran change will allow exemptions proportionate to a veteran’s federal disability percentage beginning in tax year 2026; "fully disabled veteran exemption is still in effect for tax year 2025 and subsequent years," he said. Because county staff do not yet have counts of partially disabled veterans, they could not estimate the fiscal effect of the percentage-based change for 2026 and beyond.

The budget office used 2024 final certified valuations for its estimates. For all taxing entities countywide, the existing $4,000 exemption produced roughly $773,000 in revenue loss; increasing the exemption to $10,000 would raise countywide loss to about $1,900,000, an incremental change of roughly $1,160,000. Luttrell presented the county’s (Doña Ana County) share separately: at $4,000 the county’s loss is about $252,000 and at $10,000 it would be about $630,000—a net change of approximately $378,000 based on 2024 valuations.

On the disabled-veteran exemption, staff reported a current revenue loss tied to the existing percent-disabled exemption level of about $3,500,000 countywide with roughly $1,150,000 borne by the county. "What we don't know is effective in 2026, how many veterans have a percent, disability. So we are unable to calculate the future impact due to the lack of information," Luttrell said, adding the budget office will coordinate with the assessor to produce estimates as data become available.

Commissioners pressed for more data. Commissioner Sanchez asked whether staff have visibility into counts of affected homeowners; Luttrell said the assessor’s office can report only the count tied to the current $4,000 exemption (about 6,000–7,000 claimants), but cannot today break out how many veterans will qualify under a percentage-based standard. Luttrell offered to work with the assessor’s office to prepare a jurisdiction-level breakdown of impacts based on 2024 valuations and provide that to other taxing entities.

Budget staff noted that historic property-tax receipts often exceed budgeted estimates because of how the Department of Finance and Administration requires counties to budget using the most recent certified valuations; they said the county’s recent five-year actuals often come in above budgeted amounts and that cushion could help absorb some of the change depending on how many veterans qualify for the percentage exemption in 2026.

Commissioners did not take action on the item during the work session. Staff recommended continuing to refine estimates with assessor data and sharing jurisdiction-level breakdowns so municipalities and school districts can factor the change into their budgeting processes.

Ending: County staff said they will provide updated estimates as assessor data for returns and disability percentages become available and will share a breakdown with other taxing entities to aid their budgeting. No formal county action or local policy change was adopted during the session.