(Constitutional Amendment) Authorizes a taxing authority to levy a millage at a rate lower than the maximum authorized rate under certain circumstances (EG SEE FISC NOTE LF RV See Note)

House Bill 521 proposes a constitutional amendment that modifies Article VII, Section 23(C) of the Louisiana Constitution to change how taxing authorities manage their millage rates over time. Currently, Louisiana law permits taxing authorities to increase millage rates up to a maximum authorized rate established in prior reassessments through a two-thirds vote without voter approval, but the Constitution provides that if a taxing authority fails to increase to that maximum authorized rate before the next reassessment occurs, it permanently loses the ability to access that higher rate ceiling in the future. This amendment eliminates that "use it or lose it" provision by allowing taxing authorities to maintain their access to the maximum authorized millage rate from prior reassessments indefinitely, without being forced to implement such increases immediately. The operative change removes the temporal limitation of "prior year's" maximum and replaces it with language stating the authority may increase "until the authorized millage rate expires," thereby creating a continuing entitlement to the higher rate ceiling rather than a one-time opportunity.

The practical effect of this amendment falls primarily on local taxing authorities such as school boards, municipalities, parishes, and special districts that rely on ad valorem property tax revenue. Currently, these entities face a strategic decision each reassessment cycle: either increase millage rates to the maximum allowed ceiling or forfeit that ceiling permanently if they choose fiscal restraint in the interim years. This amendment removes that penalty, allowing taxing authorities to maintain lower millage rates for budgetary or political reasons while preserving the option to increase to the maximum authorized rate in future years without voter approval. Property taxpayers may be affected secondarily, as the amendment theoretically removes a structural constraint that previously could have incentivized more immediate millage increases, though the amendment itself does not automatically increase taxes and merely preserves the authority's power to do so later.

This amendment operates within Louisiana's constitutional framework for ad valorem tax millage adjustments established in Article VII, Sections 18 through 23, which were significantly reformed by the Stelly Plan constitutional amendments. The existing constitutional scheme requires automatic millage adjustments following reassessments to maintain revenue neutrality, establishes maximum authorized rates based on prior years, and permits increases beyond those automatic adjustments through the two-thirds vote mechanism described in Section 23(C). By modifying Section 23(C) specifically, this amendment preserves all other aspects of the constitutional millage adjustment framework while extending the temporal scope of the taxing authority's discretion. The amendment requires voter approval and becomes effective January 1, 2027, applicable to all tax years beginning on or after that date, with submission to Louisiana electors scheduled for the November 3, 2026 statewide election.