Cities, school boards, realtors and the livestock industry turned out Tuesday to oppose a constitutional amendment that would cap property value increases in Kansas, saying it won’t necessarily lead to property tax reductions.
The amendment, which already has passed the Kansas Senate, would cap taxable property value increases at 4% with some exceptions.
Republican state Sen. Caryn Tyson, chair of the Senate tax committee, has advocated for the bill as a way to answer widespread grumbling about property taxes in Kansas.
“One of the biggest issues, if not the largest issue, that we hear about is property taxes,” Tyson told the House tax committee on Tuesday.
“Our constituents are upset. They want us to do something, to take action,” she said.
The proposed cap includes some exceptions, including when you sell your house. Other exceptions to the cap include new construction or improvements to the property.
The amendment is getting renewed attention this year after passing the Senate on a 28-11 vote last session. It also would require support from two-thirds of the House.
The amendment, as written, would be put to a public vote this November.
Three years ago, the Legislature took a step to address property values and property tax rates.
It enacted a law requiring local governments to adjust their mill levy to account for rising property values so it brings in the same amount of revenue it did the year before.
A vote and public hearing is required to take in more money from rising property values.
“This is another bite at the apple,” Tyson said of the constitutional amendment intended to keep property taxes in check.
Republican state Rep. Adam Smith, chair of the committee, introduced a similar amendment that would base property values on the average fair market value of the parcel for the 10 calendar years immediately preceding the year of valuation.
Smith said he had concerns about setting a fixed percentage because it might work well in some areas but not as well in other areas.
Smith said a fixed percentage cap might work well in rural areas but not so much in suburban areas such as Johnson, Wyandotte and Douglas counties with heavy residential areas that are growing.
“That 4% cap might work great in my area, it really over the long term creates discrepancies in areas where there’s a large urban population,” he said.
Smith held hearings on both amendments on Tuesday, and he’s not quite sure whether he will work either one with the session quickly winding down.
“There’s not much time left,” Smith said.
“There’s a lot of complications and concerns with both of them.”
Opponents of the amendment that already passed the Senate said it would not prevent property taxes from increasing.
Aaron Popelka, lobbyist for the Kansas Livestock Association, said in some instances property taxes could increase depending on the class of property.
Popelka noted that there are several factors that go into calculating property taxes such as the appraisal, the assessment and the property tax rates set by local governments.
“Let’s say you capped it at the current appraisal, your taxes are still going to go up if the local budgets increase,” he said.
The bill, he said, doesn’t get at the “root of the problem of delivering actual relief.”
“It just affects one component of the formula and depending on where you’re at could actually end up hurting,” he said.
Mark Tomb, lobbyist for the Kansas Association of Realtors, voiced similar concerns to the House tax committee.
“It’s certainly a formula when you talk about property taxes, and this really only addresses really one side of that,” he said.
“Local governments would still have the ability to raise the amount of income they require with only the limitations of the revenue-neutral hearing…and the ballot box,” Tomb said.
“They will still be able to increase their revenue,” he said.
Leavenworth County Commissioner Mike Stieben testified in support of the bill, reading a letter in support on behalf of the entire county commission.
“We need to have some kind of ability to limit the increases and the spike people are facing,” Stieben said.
“We’re literally going to drive our folks out of our counties and they won’t be able to live where they live and they want to stay in Kansas,” Stieben said.
“People are so overburdened with property taxes. We’ve got to do something,” he said.
Several Republican lawmakers on the committee appeared to support the idea.
“This is not a Republican or Democrat issue,” said Republican state Rep. Ken Corbet of Topeka. “This affects everybody in this state.
“I hope we get to work this and hope this gets on the ballot.”
