The House Ways and Means Committee advanced legislation that would give parishes the option to increase the homestead exemption for property owners.
The homestead exemption–$7,500 on the first $75,000 value of one’s home– has not increased since 1980, when the average cost of a house in Louisiana was $43,000. Right now, the average price of a home in the state is $200,000.
HB 271 sponsor Rep. Matthew Willard (D-New Orleans) says the bill will give parishes the chance to increase the maximum exemption to $12,500.
But critics of the bill, like Rep. Michael Echols (R-Monroe), say the proposal is too expensive and could force cuts to other areas of government. Echols told Williard he should focus on decreasing crime to keep residents from leaving. The Republican says increasing the exemption would negatively impact education.
“Somewhere between $536 million to almost a billion dollars of impact. If the state adopted this policy, do you know what that would do to our educational systems and other things that are funded by property taxes?” Echols stated.
Before introducing the bill, Willard offered to add an amendment that would give local governments the option to increase the homestead exemption. The Democrat says he’s trying to give homeowners a break as they struggle with insurance premiums and more rising costs.
“ I do have an issue with you presuming you know what's best. In the City of New Orleans, I can tell you top of mind issues in the City of New Orleans right now are going to be the insurance crisis. It's going to be infrastructure, it's going to be property taxes,” said Williard.
Williard says people are leaving the state for a number of reasons, and affordable housing is a major problem. Willard said the amended legislation gives parishes final say on increasing the exemption.
“ So, if the parish decides not to do it, there's no impact. If certain parishes decide to do it, they know the impact because they have made the decision to increase it. So for me, it's a balance, right, said Willard.
The committee voted 9 to 5 to advance the bill. Five Republicans voted against it.
The bill must receive a two-thirds majority in both chambers before it can go before voters as a constitutional amendment.
