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Committee hears HB1575 to adjust property-tax formula percentages for residential, commercial and ag

February 17, 2025 | 2025 Legislature NC, North Carolina


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Committee hears HB1575 to adjust property-tax formula percentages for residential, commercial and ag
Representative Craig Hedlund presented House Bill 1575 to the committee and explained the committee amended the bill so the calculation percentages apply across property classes.

Under the committee amendment Hedlund described, the residential calculation would change from 9% to 6.25% (a 2.75 percentage-point change) while commercial and agricultural calculations would change from 10% to 8.5%. Hedlund said the residential shift equates to roughly a 30% reduction under the formula and the commercial/ag change equates to about a 15% reduction under the formula’s mechanics.

Hedlund told members that when the committee made those changes it had not yet seen a full fiscal note; a subsequent fiscal estimate referenced in committee placed the bill’s cost at a higher level than internal estimates. The transcript records Haglund saying the fiscal note came in at roughly $20007.03 (format in transcript), and he urged members to consider adjusting the percentages if they wish to change the overall cost.

Committee members asked whether the bill could distinguish in‑state versus out‑of‑state ownership and whether that approach would survive constitutional scrutiny; Hedlund said drafters had difficulty producing language that would reliably separate in- and out‑of‑state ownership and that such language raised uncertainty about potential litigation. Members also discussed whether other policy remedies (for example, targeted benefits for younger farmers or new-operator programs) could achieve related goals.

Ending: The bill was heard and discussed; the committee did not take final action and members said they would consider fiscal numbers and potential alternative language before further consideration.

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