Caveat: It is too early to tell at this point, but, according to this article from the Albuquerque Journal Governor Bill Richardson may be pushing a “fix” for the problem of tax lightning during the upcoming legislative session. For the uninitiated, “tax lightning” is a situation in New Mexico dealing with property taxes in which someone who buys a new home experiences a dramatic increase in property tax burdens because the property they are purchasing is no longer covered under the state’s 3 percent annual assessment increase limit.
The fix, as it is spelled out in The Journal would involve altering New Mexico’s Constitution to “allow for a class of people to be taxed differently. This would allow the state to continue protecting longtime homeowners with the 3 percent cap on rising home values.”
While we applaud efforts to protect homeowners with the 3 percent cap, the idea of allowing the politicians in Santa Fe to start taxing different groups of people differently would open a dangerous new way for them to discriminate against various groups of taxpayers. In fact, New Mexico’s “anti-donation clause” was meant, in part, to prevent this discrimination among various groups of taxpayers, but it has been weakened over the years to the point that various special interests are able to use the rest of us as a piggybank.
Rather than changing the Constitution, New Mexico’s elected leaders should consider a flat 3% cap for everyone. That would be the fairest solution to “tax lightning.”
We don’t need a change to the constitution. What we need is for our legislators to remove the tax lightening, return all the over taxation on the 3%’ers, limit the annual increase at 3% and provide for a decline in value reassessment.
We do not need a change to the constitution. The only way to remedy the situation is to eliminate the 3% cap and return all residential property to full and correct value. People who overpaid should be reimbursed without having to sue the Assessor.
People who purchased newly constructed homes since 2001 are assessed full and correct value, so they will be the next group to sue because they are being assessed at 10-15% more than capped properties, every year. I moved to NM 3 years ago, I am amazed at the number of people who cannot get this right! You cannot mess with assessed values and have a constitutional system. You can further see the farce in the idea of a cap, since most properties have not appreciated at all in the last two years. People who own highly appreciating properties should pay their fair share since they will reap the benefits upon sale of the property.