State Bill 478 on Property Tax Levy Limits and Liberty Village Household Payments

State Bill 478, approved by the legislature on 2 July, sets a 2.5 percent annual cap on property tax levy growth for single-family homes and small multifamily buildings in Liberty Village. The measure applies to the 12,800 parcels currently on the municipal assessment roll.

The bill responds to revenue projections released by the state revenue department in May, which showed levy growth averaging 4.1 percent per year over the prior three budget cycles. Lawmakers directed the cap at residential classes only, leaving commercial and industrial parcels outside the limit.

Changes to Local Revenue and Services

Liberty Village officials have used recent levy growth to cover 18 percent of the municipal budget for road maintenance and library operations. Under the new cap the city projects a $1.9 million shortfall in the 2027 fiscal year compared with prior forecasts. Residents may see slower expansion of sidewalk repair schedules on streets such as Liberty Avenue and reduced hours at the branch library on Market Street.

Local advocates note that households with assessed values between $450,000 and $650,000 will see their tax bills rise by no more than $310 in the first year of the cap. Renters in buildings with more than four units are not directly covered, though property owners may pass a portion of any remaining increase through lease renewals.

Next Steps for Implementation

The state department of revenue will issue revised levy worksheets to county assessors by 15 September. Liberty Village finance staff must submit a compliance plan to the municipal council by 1 November. County records show the first tax statements reflecting the cap will reach mailboxes in February 2027.

Policy analysts say future adjustments will depend on inflation data published each October by the state statistical agency. The legislation requires a review hearing in the legislature after two full assessment cycles.