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Veterans’ property tax exemptions bill stays in committee

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Copyright © 2021 Roswell Daily Record

Lack of a quorum at the the time of a legislative committee vote Saturday morning meant that a proposed state constitutional amendment to increase property tax exemptions for veterans and their surviving spouses by $6,000 a year will remain in the New Mexico Senate Rules Committee until it has enough members present to make a decision about the pending legislation.

The bill, House Joint Resolution 3, is on a “do pass” motion that requires no further committee discussion, said committee chair Sen. Daniel Ivey-Soto, D-Albuquerque.

He said the group is expected to vote the next time it meets, which should be some time this coming week.

If the bill does pass the Rules Committee as expected, it will then head to the Senate Tax, Business and Transportation Committee soon. The legislative session ends March 20.

The bill already has passed two House of Representatives committees, as well as the entire House. Representatives voted March 1 to forward it to the Senate by a vote of 64-0.

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The bill would ask for a constitutional amendment question to be put before state voters at the next general election or during a special election to determine if they are willing to increase the property tax waiver for honorably discharged veterans or their widows or widowers from the current amount of $4,000 a year to $10,000 a year starting in 2023.

“The $4,000 amount was set in 2005 and it hasn’t changed since then,” said bill sponsor, Rep. Eliseo Lee Alcon, D-Milan. “Property values throughout the state have risen considerably, and we are hoping at this time we can let the voters decide if our veterans can get a better break.”

Area legislator, Sen. Cliff Pirtle, R-Roswell, said he would like to find a way to change the wording of the amendment so that future dollar amount adjustments could occur with the passing of laws by the Legislature rather than requiring a statewide vote on a constitutional amendment.

“That was actually the only issue that I had, if we could just write it in a way that gives the Legislature the authority to do exemptions so that the next time we need to do this as property values rise and due to inflation throughout the years, we can do this through statute instead of having to amend the constitution every single time,” Pirtle said.

Ivey-Soto noted that the Tax, Business and Transportation Committee will need to consider the tax consequences of the bill, because non-veterans would have to pay higher property tax rates each year so that state and local governments would continue to receive the same tax revenues.

According to the Fiscal Impact Report prepared for legislators, a rough estimate is that the change would result in an average tax decrease of about $180 a year for the state’s 100,000 qualifying veterans and surviving spouses. The corresponding average property tax increase for other property owners in New Mexico would be an average of about $34 a year.

For Chaves County, which has about 2,514 qualifying veterans or survivors, the estimates are that $322,255 in taxes would be shifted each year from veterans to other property owners.

Passage of the bill also would entail $150,000 to $200,000 for ballot and election materials, according to the Fiscal Impact Report. If voters approve the amendment, it would require an additional state employee to certify exemption eligibility and would mean that some school districts could experience some decrease in their bonding capacities.

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