H 432

GENERAL ASSEMBLY OF NORTH CAROLINA
  SESSION 2025
 H  2
  HOUSE BILL 432
  Committee Substitute Favorable 4/15/25
 Short Title:   Property Tax Relief Study.  (Public)
 Sponsors:
 Referred to:
  March 19, 2025
1A BILL TO BE ENTITLED
2 AN ACT TO DIRECT THE REVENUE LAWS STUDY COMMITTEE TO EXAMINE THE
3     CURRENT PROPERTY TAX RELIEF PROGRAMS FOR ELDERLY, DISABLED, AND
4     DISABLED VETERAN HOMEOWNERS; TO EVALUATE WHETHER ANY
5     MODIFICATIONS SHOULD BE MADE TO REDUCE THE PROPERTY TAX BURDEN
6     ON THOSE HOMEOWNERS; TO CONSIDER OTHER PROPERTY TAX REFORMS;
7     AND TO REPORT ITS FINDINGS AND RECOMMENDATIONS, IF ANY, TO THE 2026
8     REGULAR SESSION OF THE GENERAL ASSEMBLY.
9 The General Assembly of North Carolina enacts:
10SECTION 1. The Revenue Laws Study Committee is directed to study options for
11 enhancing the property tax relief currently afforded to low-income, elderly, and disabled citizens
12 and disabled veterans and consider other property tax reforms that may reduce the property tax
13 burden while balancing the potential impact on local government revenues. In conducting the
14 study, the Committee may do the following:
15(1)   Examine the following property tax relief programs currently available for
16certain homeowners: (i) elderly or disabled property tax homestead exclusion
17(G.S. 105-277.1), (ii) property tax homestead circuit breaker
18(G.S. 105-277.1B), and (iii) disabled veteran property tax homestead
19exclusion (G.S. 105-277.1C).
20(2)   Evaluate options that could provide additional property tax relief under the
21programs listed in subdivision (1) of this section, such as:
22a.      Increasing the exclusion amounts.
23b.      Increasing the income threshold or examining the definition of
24"income."
25c.      With respect to the circuit breaker, modifying the deferred tax
26obligation or the age and disability requirements, raising the income
27limit, or tying the income limit to a percentage of area median income.
28(3)   Consider mechanisms that would expand property tax relief to homeowners
29more broadly, such as limiting year-to-year property tax increases and
30valuation growth, providing homeowners with alternative payment plans, or
31implementing methods, such as annual statistical adjustments, to capture
32year-over-year property valuation changes to minimize the impact of
33reappraisals.
34(4)   Examine the uniformity requirement in Article V, Section 2 of the North
35Carolina Constitution and evaluate whether to amend the North Carolina
  *H432-v-2*
 General Assembly Of North Carolina  Session 2025
1Constitution to allow counties the option of making one or more of these
2changes at the local level.
3(5)    Consider the positive and negative impacts on local government ad valorem
4tax revenues of providing additional property tax relief and whether the State
5should reimburse local governments or provide local governments with
6additional revenue-generating authority to backfill lost revenue due to
7enhanced property tax relief. As part of this consideration, the Committee may
8seek input from the North Carolina Association of County Commissioners or
9the North Carolina League of Municipalities.
10(6)    Review property tax relief programs in other states.
11The Committee may consult with any other relevant State, local, or private entity in
12 conducting the study required by this act. The Committee must report its findings, along with
13 any legislative recommendations, to the 2026 Regular Session of the 2025 General Assembly.
14SECTION 2. This act is effective when it becomes law.
 Page 2  House Bill 432-Second Edition