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F I S C A L I M P A C T R E P O R T

SPONSOR Fox-Young

ORIGINAL DATE

LAST UPDATED

02/27/07

HB HJR 15

SHORT TITLE Low-Income Disabled Person Property Tax, CA

SB

ANALYST Hanika Ortiz

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

FY09

See narrative

Recurring

Local

Governments

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

No Response Received From

Taxation & Revenue Department (TRD)

SUMMARY

Synopsis of Bill

House Joint Resolution 15, if approved by the voters, will amend Article VIII of the New

Mexico Constitution to provide a property tax exemption for property owned and occupied by a

low income person who is permanently disabled. The amendment also requires the property to

have been adapted to the person’s disability.

FISCAL IMPLICATIONS

There will be a negative impact to tax revenue and this will depend on how many individuals

qualify and take this exemption. However, the debt service from property taxes will still have to

be paid, so potentially rates will adjust to correct for any loss.

There could be significant impacts to some jurisdictions based on the concentration of those

eligible to take the exemption and property tax rates. An analysis from the Taxation and Revenue

Department will be necessary to determine these figures.

House Joint Resolution 15 – Page

2

SIGNIFICANT ISSUES

The property exemption will include any community or joint property of a husband and wife.

Any person claiming the exemption must be permanently disabled pursuant to either the Social

Security Act or the Workers’ Compensation Act; has income not exceeding two hundred percent

of federal poverty guidelines; occupies the property as their principal place of residence; and, has

specially adapted the residence to the person’s disability.

The bill also allows the exemption for the widow or widower of an eligible person provided they

continue to live in the specially adapted property.

TECHNICAL ISSUES

The bill appears to only provide for persons with physical disabilities; and, appears to not

address low income permanently disabled persons with non-physical disabilities such as those

with mental health disorders that may not necessarily need their residence modified.

There also appears to be no requirements that the home have a certain value or the land be of a

certain size limitation; and, provides no guidelines as to what modifications to a property will

meet the definition of being “adapted" to one’s disability.

The bill also doesn’t provide any direction as to how often one must apply to maintain the

exemption, such as every four years.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

Low-income, permanently disabled individuals may need to sell or lose their homes; and, this

situation may result in an increased impact on State agencies in disabled and elderly services that

might not otherwise have been needed.

AHO/csd