Tax Concerns: Affordable Housing

Lauderdale County, Miss. A local official is calling for changes to a law that he says costs Lauderdale County a minimum of almost $1,000,000 a year.

"I'm asking for the taxpayers of this county to look at the fairness of this," says Lauderdale County Tax Assessor James Rainey. He's talking about a state law that addresses how property taxes are assessed for affordable housing in Mississippi.

"The supreme court ruled that Section 42 housing now can utilize all of their tax statements and their financial statements to do their assessments of properties," says Rainey.

The Mississippi Supreme Court issued a ruling regarding this law late last year. The ruling determined that tax credits for the owners of these housing developments, which some still refer to as Section 8 properties, cannot be used to assess the amount of taxes owed.

"We all want affordable housing for our people in this county, that's not a problem," says Rainey. "Right now the way that it's written, we have to accept their values and so on. We have no option to look into their statements or anything that they turn in."

Because of the law's design, Rainey says 3 of the 17 Section 42 affordable housing developments in Lauderdale County do not have to pay anything for property nor school taxes this year. He contends that this is not fair.

"If you take one house across from the section line, and there in another subdivision they're valued at approximately the same rates and they pay like $1,400 a year approximately in tax, where this section 42 pays zero," says Rainey.

He estimates that each year this law cost Lauderdale County at least $750,000 in losses. State representative Greg Snowden says in recent years the Mississippi legislature has reevaluated this law. So far this session, he says nothing regarding it has been proposed to lawmakers. However, sometime this spring Snowden expects that a measure on the law will be presented to legislators.

Meanwhile, costing the county at least $750-thousand dollars a year, Rainey says this law is an issue that his office, and the county cannot afford to ignore.

Currently, the owners of six of the 17 properties in Lauderdale County that are deemed as Section 42 developments are appealing their tax assessments for this year.