The proposed bill, if enacted, would amend current statutes regarding property tax exemptions by updating the method used to adjust the property assessment limit for qualifying individuals. Currently, the Arizona Department of Revenue (ADOR) increases the property assessment limit based on the average annual percentage increase in the GDP price deflator. The bill would change this to use the Federal Housing Finance Agency House Price Index (FHFA HPI) starting in tax year 2026, thereby aligning the assessment limit adjustments with changes in single-family house prices rather than the GDP price deflator.

Additionally, the bill introduces a definition for "federal house price index" and makes conforming changes to the existing language. It retains the current exemption amounts and income limits but specifies that the assessment limit for certain exemptions will be adjusted based on the FHFA HPI. The bill also clarifies that the total allowable exemption amount and income limit adjustments will continue to be based on the GDP price deflator until the new method takes effect. Overall, these changes aim to provide a more relevant and potentially beneficial adjustment mechanism for property tax exemptions.

Statutes affected:
Introduced Version: 42-11111
Senate Engrossed Version: 42-11111
Chaptered Version: 42-11111