LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 38 HLS 201ES 112
Bill Text Version: ORIGINAL
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: June 8, 2020 3:24 PM Author: IVEY
Dept./Agy.: Local Governments
Subject: Payments in Lieu of Ad Valorem Taxes Analyst: Greg Albrecht
TAX/AD VALOREM TAX OR SEE FISC NOTE LF RV See Note Page 1 of 1
(Constitutional Amendment) To authorize local taxing authorities to enter into cooperative endeavor agreements for the
purpose of payments in lieu of taxes (Item #28)
Present constitution enumerates specific properties that are exempt from ad valorem taxation and provides that no other
property shall be exempt.
Proposed constitutional amendment adds to the exemptions non-residential property subject to a cooperative endeavor
agreement between the owner and one or more taxing authorities, as provided by law, in which the property owner makes
payments in lieu of ad valorem taxes to the extent provided in the agreement. Applicable to non-residential immovable
property. Terms of such agreements can be up to 40 years. Enactment of law to administer this provision shall require a
two-thirds vote of the legislature.
To be submitted to the electors at the statewide election to be held on November 3, 2020.
EXPENDITURES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total $0 $0 $0 $0 $0 $0
REVENUES 2020-21 2021-22 2022-23 2023-24 2024-25 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds SEE BELOW SEE BELOW SEE BELOW SEE BELOW SEE BELOW
Annual Total
EXPENDITURE EXPLANATION
There is no anticipated direct material effect on governmental expenditures as a result of this measure.
REVENUE EXPLANATION
The amendment provides local governments the ability to grant ad valorem tax exemptions in lieu of other payments to non-
residential immovable property, subject to statutory provisions. Although there may be numerous reasons for both local
governments and taxpayers to enter cooperative endeavor agreements to achieve community goals, the utilization of this
authority may result in lower local ad valorem tax revenue collections, in that, taxpayer payments in lieu of ad valorem tax
may be lower than the ad valorem tax itself. Otherwise, taxpayers may not be inclined to enter the cooperative endeavor
agreements. However the payments in lieu of ad valorem tax may provide resources for particular local projects that might
not be available from other sources. Utilization of such agreements is speculative, and the ultimate local government
aggregate revenue impacts can not be projected.
Senate Dual Referral Rules House
13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
John D. Carpenter
13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} or a Net Fee Decrease {S} Legislative Fiscal Officer