State and Local Issue: Taxes

A trend among local legislators is to raise taxes through legislation or ballot measures to pay for city services or legal fees related to rent control protections. NAHB’s State and Local Fund (SLIF) supports HBA efforts to fight against tax increases and impact fees.

Legislative Analysis: SCR 1611 Property Tax Valuations

Senate Concurrent Resolution (SCR) 1611 amends section 1 of article 11 of the constitution of the state of Kansas. Further, if voted by the legislature, it will go to the voters for a vote. The legislative bill works to cap property valuations by 4% except for new construction or remodeling. If passed in the legislature, the SCR 1611 will go to the ballot for the 2024 year. View the analysis.

Defeating Anti-Housing Capital Gains Tax in Oregon

HBA of Greater Portland (Ore.)

The HBA received SLIF funding to fight a ballot measure that would institute a new adjustable capital gains tax in Multnomah County to fund an eviction protection and legal assistance program for tenants. The rate would start at .75% of capital gains and can be adjusted by the county’s board. This measure may be a test case for similar campaigns elsewhere and would seriously harm the region’s already stressed housing industry. The HBA formed a coalition that includes the Portland Metropolitan Realtors Association, Portland Business Alliance, Oregon SmartGrowth, and Commercial Real Estate Development Association of Oregon. SLIF funds will support advertising activities for the coalition's campaign, such as mailers, tv placements, and a consultant.

Estimated project cost: $500,000
Funding request: $20,000

Income and Property Tax Increases, Vote No on Amendment 73

Colorado Association of Home Builders

The HBA had to fight against a ballot initiative that would increase income tax rates and modify property tax rates. If this ballot measure were to pass, the top income tax bracket would increase to 8.25%, which is a 78% increase. In addition, the corporate tax would increase to 6% representing a 30% increase. The measure sets the residential property tax assessment rate to 7% and the non-residential rate at 24%. If passed, small businesses would pay a higher income tax rate than multimillion-dollar corporations.

Estimated project cost: $2.8 million-$4.6 million
Funding request: $20,000

Ballot results: Defeated; 53.57% of voters voted “NO” on the ballot.

Tax Abatement Preservation Campaign

Building Industry Association of Philadelphia

The City of Philadelphia’s ten-year property tax abatement program is critical to the health of the city’s housing market. Unfortunately, city council members introduced two bills that propose changes to the program, so the BIA will use SLIF funds to conduct research and develop a public relations strategy to educate decision makers and gain support for the existing program.

Estimated project cost: $40,000
Funding request: $15,000

Eliminating Mortgage Interest and Property Tax Deductions

Kansas Building Industry Association and Wichita Area Builders Association

The HBAs ramped up lobbying activities, worked with coalition partners and engaged lawmakers at the constituent and grassroots levels in response to the Governor’s proposal to eliminate the mortgage interest and general property tax deductions for Kansas home owners who itemize deductions when filing their state income tax returns. KBIA and WABA oppose this proposal due to the negative impact this would have on the Kansas housing industry still struggling to recover from the recession.

Estimated project cost: n/a
Funding request: $25,000

Protect Oregon’s Mortgage Interest

Oregon Home Builders Association

Oregon taxpayers can deduct their mortgage interest on their state income tax return just as they have on their federal return. However, faced with a state budget deficit, state lawmakers are looking at “disconnecting” the state tax law from the Internal Revenue Code – and have talked explicitly about targeting the mortgage interest deduction. With the Oregon Association of Realtors as a coalition partner, the HBA planned to run a campaign with polling, grassroots mobilization, radio and print media, a website and lobbying days to protect the mortgage interest deduction.

Estimated project cost: $350,000
Funding request: $20,000

Contributions in Aid of Construction Payments

New Jersey Builders Association

Contributions of Aid of Construction payments made by builders are included in a utility’s taxable income due to an updated provision in the federal Tax Cuts and Jobs Act. Due to this change, utilities in many states began to pass on the cost of this tax to the developer. In response, the HBA applied for SLIF funding to gather information and build a team to work with state officials and utility companies in order to secure a “no gross-up” modelled arrangement which would not require the developer to pay additional taxes.

Estimated project cost: $20,000
Funding requested: $20,000