Why It Matters
North Carolina lawmakers are considering a constitutional amendment to restrict property tax increases, but housing advocates argue the state already has mechanisms in place that could address homeowner concerns if properly expanded and improved.
The debate centers on how best to provide relief to homeowners facing rising property tax bills, particularly seniors and disabled residents on fixed incomes.
What Happened
Hudson Vaughan, director of the Community Justice Collaborative at the North Carolina Housing Coalition, urged lawmakers to focus on strengthening the state’s homestead exemption and circuit breaker programs rather than pursuing a constitutional amendment.
The proposed amendment would grant the General Assembly authority to limit property tax increases but does not specify how such restrictions would work. The measure is a response to complaints from homeowners and some lawmakers who attribute rising property taxes partly to local government spending.
By the Numbers
Under North Carolina’s current Elderly/Disabled Homestead Exemption, qualifying residents can exclude from taxes the greater of $25,000 or 50% of their home’s assessed value. Income limits are set at $38,800 or less for the preceding year.
The state’s Circuit Breaker program caps annual property taxes at a fixed percentage of income for eligible homeowners. Income for applicants and spouses cannot exceed $58,200.
The disabled veterans exclusion provides a $45,000 exclusion from appraised value for qualifying permanent residences.
Zoom Out
Property tax relief has become a focal point in state legislatures across the country as rising home values drive up tax bills, particularly in high-growth areas. States have taken varying approaches, from constitutional caps on assessment increases to targeted relief programs for vulnerable populations.
North Carolina’s existing programs follow a targeted approach, focusing on seniors and disabled homeowners rather than broad-based caps that would affect all property owners.
What’s Next
Lawmakers will determine whether to advance the constitutional amendment or pursue changes to existing relief programs. Any amendment would require legislative approval before going to voters.
Accompanying legislation would need to specify the mechanics of any property tax restrictions if the constitutional change moves forward.