Lawmakers consider limited property‑tax exemption for modest residential remodels to ease housing and caregiving costs

Representative Jane Gillette introduced House Bill 412 to create a limited exemption for residential property owners who increase the livable space in their homes (for example to accommodate an aging relative). Under the bill a qualifying increase in taxable value would be exempted up to a capped amount based on the property's prior taxable value and a percentage threshold, would require at least three years since the last exemption and would be available only once every six years.

Gillette said the goal is to reduce the property‑tax penalty that can discourage modest home expansions to care for family members or to create secondary rental income. She said the Department of Revenue helped draft the bill and believes the change could be implemented within its existing budget.

Bryce Kaatz, bureau chief with the Property Assessment Division, explained implementation mechanics: valuation changes depend on whether the department uses cost manuals or comparable‑sales approaches, mills vary widely by locality and therefore tax savings vary. Kaatz said the department often uncovers unpermitted or new finished space during property sales and that the fiscal note will refine estimated impacts.

Committee members asked whether the department would need new staff or outreach; Kaatz said the department expected to absorb the workload within existing operations but would provide more refined fiscal estimates in the fiscal note. The sponsor closed asking for a due pass and invited further technical follow‑up.