AMENDMENT 3 • HOUSE BILL 1089
Limits on local property tax increases - with no percentage in the text
On the ballot: “Constitutional amendment requiring limits on property tax increases by local governments.”
What is true today - and the direct answer on a percentage
No, this amendment does not restrict property taxes to a specific percentage. It sets no cap, rate, or formula. If approved, the constitution would add one sentence: “The General Assembly shall enact general laws limiting the amount by which the levy of taxes on property may increase, which may include exceptions.” The actual limit - and any exceptions for growth, disasters, debt, or voter-approved levies - would be written later, in ordinary legislation.
A levy limit is about total dollars collected by a county or city, not the rate and not any one bill: if collections hit a future limit, rates adjust, but an individual bill could still rise if that property’s value rose faster than others. A rate cap already exists in state law - generally $1.50 per $100 of value for most purposes (average county rate in fiscal 2025-26: about $0.58 per $100). This amendment would add a limit on how fast collections grow, on top of that rate cap.
A FOR vote means you support requiring the legislature to enact levy limits. You are voting for the requirement - the specific limit will be decided afterward by lawmakers.
An AGAINST vote means no constitutional requirement is added. Local boards keep setting levies under current law, and the legislature remains free - as it is today - to pass levy limits by ordinary law if it chooses.
Supporters argue
Relief from rising bills: revaluations have pushed collections up sharply; supporters cite research that large-county collections outpaced inflation plus population growth by billions over a decade.
Predictability: homeowners and businesses could plan around a known limit on levy growth instead of open-ended increases.
Spending discipline: a limit forces local governments to justify growth and prioritize.
Voter voice: an Elon University poll found about 72% support for limiting property tax increases; supporters say voters should set that direction in the constitution.
Critics argue
Voting without the number: voters cannot judge a limit they cannot see; the formula and exceptions will be chosen after the vote, and a constitutional mandate is hard to undo if the formula proves too tight.
Less local control: decisions now made by local boards would be bounded from Raleigh, shifting authority to the state.
Schools and core services: property tax is the main local revenue source - funding schools (more than $4 billion statewide), fire, police, roads, and libraries. Leaders warn a tight limit could squeeze those services, especially in fast-growing or rural counties.
Small saving, large trade-off - as modeled: one analysis of a hypothetical 2% levy limit estimated counties would have lost about $587.8 million, for an average saving of about $84 per homeowner per year. That illustrates scale only; it is not a prediction, because no limit has been set.
Emergencies and growth: a rigid limit could leave a community short after a disaster or during rapid growth, or push costs into fees.
Immediate effect: none on your next bill. Everything depends on the follow-up law - its percentage, formula, and exceptions will determine the actual impact.