Voters To Decide On Constitutional Amendment Meant To Ease Blow Of Property Tax Increases

Nov 1, 2018

There will be several proposed changes to the state constitution on the ballot next Tuesday. One of them, Amendment 6, is meant to ease the blow of a sudden increase in property taxes. That’s something experienced by many people in rapidly gentrifying areas of New Orleans. But opinion is divided on whether Amendment 6 is the right solution.

Andy Young is standing on a corner in the Bywater, across the street from the house she and her husband used to own. A giant live oak tree shades most of the block. 

"That green one," Young says, motioning to a raised shotgun home near the corner. "It wasn't that color."

When Young lived here, it was a light purple with red trim. She and her husband bought it in 2008 for about $136,000. They lived here for ten years, raised two children, and made a lot of memories.

"So many meals cooked in that kitchen...so many backyard birthday parties...my daughter taking her first steps in the living room," Young remembers. 

They also saw a lot of changes to the neighborhood. Buyers started flipping homes. A fancy new condominium went up at the end of their street. And Young says a bunch of short-term renters appeared.

Home values in her neighborhood rocketed up. Orleans Parish reappraised many Marigny and Bywater homes in 2017. When Young got her new tax assessment, she was shocked. Her home value went from $140,000 to $318,000, and her tax bill nearly tripled. She says they couldn’t afford it. They decided to sell the house and move before the bill was due in six months. She says it was a really stressful time.

"To suddenly realize you’ve got to figure out how to find a new place to live, sell your house, get your house ready to sell, which is its own thing...is a lot of pressure," she explained.

Residents in rapidly gentrifying areas like the Bywater say Young isn’t the only longtime homeowner forced out by a sudden increase in her tax bill, and that many residents who've lived there much longer than Young could be forced to leave. That’s why a of couple neighborhood associations worked with Louisiana State Senator J.P. Morrell to create Amendment 6. If it passes, homeowners who see more than a 50 percent increase in their assessed home value would be allowed to phase in their new tax requirements over four years.

"It buys you time," Morrell, a New Orleans Democrat, explains.

The first year, homeowners would pay a quarter of the increase in their tax bill, the second year half, and by fourth year they’d be responsible for the full amount.

"We’ll create kind of an easement period where those individuals who are facing enormous assessments have the ability to try and figure out what they’re going to do with their property in that period between assessments," he says.

The proposition has gotten pushback from the nonprofit Bureau of Governmental Research (BGR).  BGR’s Stephen Stuart says the amendment looks more like the result of political compromise than a solution grounded in real research. And he’s worried that writing it into the state constitution would make it really hard to change later.

"Our position is that before the legislature takes any further action on property tax relief, that they should do an analysis on the extent of the need, and develop a precise solution that is tailored to address the problem," he says.

Stuart says there are many solutions to the problem of people being forced out by rising property taxes. Some states limit how much property taxes can rise. Some offer income-based property-tax relief. Those measures could allow people to stay in their homes - not just buy them time.

But Morrell says because issue of rising assessments is so specific to Orleans Parish, there’s just not enough statewide political support to pass something like that.

"They’ve been trying for years to pass something else that’s better, which was unsuccessful, and this compromise finally passed," he says. "To take the position of something else better will come along, what is that?" 

It’s too late for the proposed amendment to help Young. She plans on voting for it anyway, even though, she says, it’s not perfect.

"It certainly doesn’t solve everything, but I think just giving people time to react to a huge change in their life would be extremely beneficial," she says.

Young and her family are renting now. But they plan to use the money from their home sale to build a smaller home in a cheaper part of town.