Senate panel advances bill to exempt locally assessed business personal property after emotional small-business testimony

The Senate Appropriations Committee on Wednesday gave House Bill 2389 a do-pass recommendation after a heated public-comment period that brought several small-business owners to the dais to describe large county assessments and administrative hardship.

HB 2389 would, effective Jan. 1, 2032, exempt all locally assessed personal property used in trade or business from property tax and remove the current personal-property categories from the property tax classifications. Committee staff summarized the measure before several affected business owners described their experiences with county assessors.

Mahmood Moyidin of Apache Junction told the committee he received a bill from Pinal County for roughly $37,000 and said the county was effectively taxing equipment and fixtures that he already paid sales tax on when purchased. "We keep paying the tax all over again," Moyidin said, adding that the administrative burden of responding and assembling receipts could be crippling for a small operation.

Kim French, who said she and her husband run a Gold Canyon restaurant with 22 employees, described receiving an assessment after county staff found the business on Facebook. "I have to go through and count every piece of silverware, every salt shaker'come on," French said, arguing the process is time-consuming and punitive for small proprietors.

Supporters on the committee framed the bill as constituent relief. "They've already been taxed when they purchased the items," Senator Carter said, calling the assessments effectively a "triple tax." Several senators expressed sympathy for the witnesses and noted county appeal processes, but also said the legislature can change state law.

Opponents warned of broader fiscal consequences. One senator recited the committee's fiscal-note findings, saying the exemption would amount to an estimated $14.8 million loss to the state general fund and a $59 million shift of tax burden to other property classes, primarily residential. "So this is like taking a giant step," a senator opposed to the bill said, adding that the measure would amount to a large property-tax cut for large businesses.

The committee voted to advance the bill by a 7-3 margin. Several senators provided detailed explanations of their votes on record, with supporters citing the immediate hardship of assessed businesses and opponents stressing long-term budget impacts. The bill now moves to the full Senate for further consideration.