The quiet shift from courthouse to statehouse

Key Takeaways

My wife and I talk about grocery prices more than we probably should. Two fast-growing high school boys will do that to a household budget. Add travel sports, extracurricular fees and the fast-approaching pressures of college costs, and our kitchen-table conversations sound like most households.

Affordability isn’t an abstract problem. It’s the number one issue facing Americans — and therefore elected officials.

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Visit NACo's State Policy Tracker 

Through NACo’s new State Policy Tracker, we’re tracking governors and state legislatures who are pushing a wave of tax relief measures. Session after session, coast to coast, there’s a growing squeeze on the primary revenue source for most counties: property taxes. 

Rate caps. Levy limits. Expanded exemptions. These aren’t buzzwords. These policy plans have real-world impacts. Same end goal, yet modified attacks on local revenues and decisions.

Some of this pressure is real. Assessments have outpaced paychecks in plenty of places, with total property taxes collected up 27 percent above inflation since 2000, according to the Tax Foundation. Staffing, disaster recovery, infrastructure materials, service costs and unfunded mandates have also hit county leaders hard, too often outpacing local revenues. Even so, residents deserve answers and results, not political rhetoric.

But a fair question deserves an honest answer, too. Are these state measures really built around the daily struggles of residents? Or are they about something else — energizing turnout in razor-thin races, answering to special interests or a mixture?

Either way, the result is the same: taxation policy and service delivery decisions are being moved, state by state, from the courthouse to the statehouse.

I’ll say this plainly because it’s true: county officials do not enjoy raising taxes. We’re taxpayers too, writing the same checks as our neighbors. And I’ve rarely met a county official who ran for office to cast an unpopular vote, taking the uncomfortable, relentless heat that follows.

That’s exactly why this debate deserves an honest airing, not a bumper sticker.

This fight isn’t really about tax rates or exemption thresholds. Strip away the technical language, and it’s a fight about control.

Who decides how much revenue a community can raise? Who decides how local resources are allocated — county officials who answer to neighbors at the grocery store or state officials several layers removed?

Underneath that sits a mismatch. States and the federal government hand down expensive mandates, hitting jail, election, court and indigent care budgets. Counties don’t get a vote on whether to accept them. Then, the same states cap the revenue that pays for them.

The accountability lands on us. The authority to meet it increasingly doesn’t.

Here’s the quiet part. As caps stack on exemptions on top of preemptions, the tax base doesn’t shrink all at once. It narrows, carve-out by carve-out. Yet, someone must still fund the first responders, the roads, the justice system.

So, who’s left holding the bill? Younger homeowners without a legacy exemption. Renters who absorb costs passed through anyway. Small businesses without the lobbying muscle to win their own carve-out.

The mandates don’t disappear. The revenue base and decision-making authority do.

None of this excuses county officials from their responsibility to be trusted stewards of taxpayer money. We aren’t, and we shouldn’t be. But before the next property tax cap gets sold as pure relief, ask who benefits, who quietly pays more, and who’s holding the accountability.

The answer hasn’t changed since our founding. The people who bear accountability locally must have a hand in making the decisions. 

Property tax battles in the states

Governors, legislators and petition drives are pushing to shrink or eliminate property taxes. In many of these proposals, the legislation does not provide a dollar-for-dollar replacement for local revenue, leaving counties to absorb some combination of levy restrictions, spending reductions or other revenue changes.

Florida: Voters decide Amendment 3 on Nov. 3; it needs 60% to pass. Placed on the ballot in a June special session, it would raise the homestead exemption on  non-school taxes to $150,000 in 2027 and $250,000 in 2028, cut the assessment cap on non-homestead property from 10% to 5% and direct the Legislature to create a process to increase non-school homestead exemptions over time. 

It provides no state backfill and remaining property tax revenue must go to state-defined core services. Florida’s Revenue Estimating Conference estimates recurring local revenue losses of about $11.9 billion once fully phased in; county-level impacts vary substantially. 

Indiana: SB 1(2025) delivered about $1.2 billion in homeowner relief over three years through a 10% homestead credit (up to $300), phases down the standard homestead deduction and a larger business equipment exemption. 

It also reduced levy growth, requiring a separate vote to raise a levy and reduced local income tax revenue capacity by about $1.9 billion. Now some legislators are floating an end to property taxes on primary homes, which raised about $4.1 billion last year or 38% of the statewide total. The Association of Indiana Counties calls it a “huge concern” because no one has said how the money would be replaced.

Iowa: Gov. Kim Reynolds signed SF 2472 on May 18 after a last-minute deal at the end of the session. The law generally caps local government revenue growth at 2% a year, with exceptions for schools, county supplemental levies and a few others. It also limits school district unspent balances to 35% of authorized spending, swaps the homestead credit for an exemption and limits TIF (tax increment financing) districts to 20 years.

Nebraska: The loudest elimination push ended this year. The “Epic Option 2.0” drive to abolish property, income and inheritance taxes and a separate petition drive to halve taxable property values also ended, and no property tax measure made the certified November ballot. 

The 2026 session enacted LB 803, a broad property-tax and local government procedure measure, while the more aggressive local spending cap bill, LB 1219, was indefinitely postponed. Gov. Jim Pillen has since opened a property tax complaint hotline and says he’ll push local spending caps in 2027.

North Carolina: : A new law delays the use of certain 2026 property reappraisals for one year; a subsequent law changed which nine counties are subject to the moratorium. The issue is about delaying revaluations, not eliminating them. SB 889, signed by Gov. Josh Stein June 19, required affected counties to use their previous property values for the 2026-27 tax year, with 2026 reappraisal values taking effect in 2027. SB 474, effective July 7, changed the counties covered by the moratorium. 

Guilford County’s median residential assessed value rose about 65%, and Rep. Tracy Clark warned the delay could remove as much as $58 million from Guilford County Schools’ 2026-27 budget.

Texas: There are competing proposals are on the horizon for the 2027 legislative session. The homestead exemption for school taxes has grown from $15,000 in 2015 to $140,000 for school taxes, with the state covering much of the resulting school revenue loss. 

Gov. Greg Abbott’s reelection plan would let voters end school property taxes on homesteads, cap local spending growth at 3.5% or population plus inflation, require two-thirds voter approval for local tax increases and allow citizen-petitioned rollback elections. Lt. Gov. Dan Patrick prefers another $40,000 exemption. The 2027 Legislature will decide which, if any, of these approaches becomes law.