The House Select Committee on Property Tax Reduction & Reform convened on Wednesday to discuss several proposed bill drafts that have developed from previous meeting discussions, legislator priorities, and committee presentations over the last several months. Early on in the meeting, Representative Julia C. Howard, Co-Chair of the committee, noted that she’d already requested that the House committee be extended for at least another year and impressed the importance and complexity of this work to her fellow legislators. This complexity was definitely noted as the committee worked through each legislative proposal.
The first proposal considers putting to a vote a constitutional amendment that would authorize the NCGA to enact property tax levy limits. If this were to be introduced and passed in both chambers, NC voters would get to decide whether to add an amendment to the state’s constitution authorizing the NCGA to limit the rates at which local governments could raise property taxes . This proposal is not a proposal with detailed limitations or adjustments that would be placed on property tax levies–that would be separate accompanying legislation if this first proposal passes and if the voters of North Carolina approved it. Discussion around this first proposal took up the majority of this week’s meeting. To view the proposal click here. To view a summary click here.
The second proposal focused on Nonprofit Hospital Property Tax Modifications. The proposal suggested amending current law to limit a nonprofit hospital’s property tax exemption to 50% of the appraised value of all real and personal property owned by the nonprofit hospital if the property is actually and exclusively used for a charitable hospital purpose. To view the proposal, click here. To view a summary, click here.
The third proposal focused on Hospital Sales Tax Refund Modifications. This proposal recommends reducing the aggregate annual cap on state sales and use tax refunds that are available to eligible nonprofits from $31.7 Million to $10 million as well as reducing the aggregate annual cap on local sales and use tax refunds for the same nonprofits from $13.3 million to $4.25 million. To view the proposal, click here. To view a summary, click here.
The fourth legislative proposal focused on Low-and Moderate-Income Housing Property Tax exemptions. Earlier in the year, the committee listened to a presentation highlighting concerns that the broad interpretation of the nonprofit housing tax exemption is and could be abused across our state, hindering local governments without creating any real affordable or attainable housing. The proposal text tries to address this by adding more specific requirements for organizations to be eligible for this exemption. The proposal defines which non-profit organizations and joint ventures are eligible, prohibits joint ventures that do not finance affordable housing with government support, reduces the period of tax deferral for future sites of affordable housing from 10 years to 5 years, and creates a process to guide eligible organizations and local governments for the application and compliance process. To view the proposal, click here. To view a summary, click here.
The meeting concluded with an educational presentation that provided an overview of impact fees and system development fees. No votes were actually taken during this meeting, though the committee does plan to vote on these proposals at their next meeting on April 15, 2026.
Despite it coming up at various times, property tax relief programs and their modernization were not discussed, nor were they included in any of the legislative proposals at this time. Rising property taxes are contributing to a significant rise in housing cost burden for North Carolinians. State lawmakers should focus property tax relief efforts on taxpayers most burdened by unaffordable housing costs, rather than a one-size-fits-all approach that disproportionately harms seniors and people with fixed incomes. For more information, check out our two-pager on property tax relief, created in partnership with Habitat for Humanity of Wake County.
When meeting with members of the committee, many said they believe property tax relief proposals to be critical, and that they will likely be a part of the next round of proposals. The Coalition continues to work with partners and engage with members about the importance of prioritizing true property tax relief.
