Committee approves House Bill 2745 with protest-petition and distribution amendments

The Committee on Taxation voted to report House Bill 2745 favorably after adopting several amendments that reshape how local property-tax increases are constrained and how a $60,000,000 relief appropriation would be distributed. The bill would require elector approval for year-to-year increases in property-tax revenue above a 3% baseline while creating a property-tax relief fund to transfer money to counties and eligible taxing jurisdictions.

Adam, the committee reviser, summarized the measure as one that "would require a vote of the electors to approve increases in property tax revenues for the next year for a taxing jurisdiction," and said the bill establishes a property-tax relief fund and replaces prior revenue-neutral provisions with new budget rules. Committee members debated how to operationalize those limits and which revenue changes should be excluded from the 3% cap.

Representative Wolff offered a protest-petition alternative to a straight election trigger that would let taxpayers collect signatures at the county treasurer’s or clerk’s office; under the adopted language, petitions require signatures equal to 10% of those who voted in the last presidential election, collected within a 30-day window. Wolff argued the petition gives "taxpayers a voice." Representative Hsu and others pressed to raise the threshold to 20%, arguing 10% can be too low in small jurisdictions; the substitute to move to 20% failed.

The committee adopted an Essex amendment that adds a set of technical exclusions and clarifications used in prior "tax lid" law: expirations of tax increment financing (TIF) districts and other incentive mechanisms (RHIDs, neighborhood revitalization areas), annexed parcels and classification changes, and treatment of bond and temporary-note payments — limited to obligations existing before 07/01/2026 — so jurisdictions can continue to meet preexisting debt-service obligations without those amounts counting against the 3% baseline.

Representative Kehar secured an amendment to the $60,000,000 appropriation ensuring cities and other taxing jurisdictions that maintain their levy at 3% or less are eligible for their proportional share. The reviser said distribution follows a proportionate formula based on taxes levied by each jurisdiction within a county and that the county treasurer would apportion the county lump sum to eligible taxing entities.

Kehar subsequently moved to remove state and school-district exemptions from parts of the bill; that motion was contested, a division was called and counted, and the amendment failed on a 4–15 vote. Members voiced concerns about interacting with the statewide school-finance framework — including the statutory 20-mill school rate — and the practical complexities of unequal district growth and redistribution of school funding.

The committee discussed administration and predictability of the relief fund. The reviser and staff said the $60,000,000 is an annual appropriation with a 2% escalator; final apportionments to local jurisdictions depend on budgets they set, so only estimates can be provided in advance. Several members asked whether the fund could be increased in future years (it can, but would require separate appropriations).

Representative Sawyer moved that the bill be reported favorably as amended; Representative Francis seconded and the motion passed by voice vote. The committee chair announced the bill "appears to pass" and the measure was sent out of committee as amended.

What’s next: the committee reported HB 2745 with its adopted amendments; the bill will proceed to whatever next steps the chamber’s rules require (committee report and floor consideration).