Louisiana Taxation of Property Owned by Another State, Amendment 4 (2015)

• Text of measure
• Support
• Opposition
• Media editorials
• Path to the ballot
• Louisiana profile

Amendment 4
Type	Amendment
Origin	Louisiana Legislature
Topic	Taxes
Status	Approved a

The Louisiana Taxation of Property Owned by Another State, Amendment 4 was on the October 24, 2015 ballot in Louisiana as a legislatively referred constitutional amendment, where it was approved. The measure provided that property and land within Louisiana owned by states and local governments other than Louisiana and its political subdivisions do not receive the public property exemption from ad valorem property taxation.

The measure was introduced into the Louisiana Legislature by Rep. Charles R. Chaney (R-19) as House Bill 360.

Election results

Louisiana Amendment 4
Result		Votes	Percentage
a Yes		509,647	51.4%
No		481,488	48.6%

Election results via: Louisiana Secretary of State

Text of measure

Ballot title

The ballot text was as follows:

“

Do you support an amendment to specify that the ad valorem property tax exemption for public lands and other public property shall not apply to land or property owned by another state or a political subdivision of another state? (Amends Article VII, Section 21(A))

”

Constitutional changes

See also: Article VII, Louisiana Constitution

The proposed amendment amended Section 21(A) of Article VII of the Louisiana Constitution. The following underlined text was added and struck-through text was deleted by the proposed measure's approval:

§21. Other Property Exemptions

Section 21. In addition to the homestead exemption provided for in Section 20 of this Article, the following property and no other shall be exempt from ad valorem taxation:

(A) Public lands; and other public property used for public purposes. Land or property owned by another state or owned by a political subdivision of another state shall not be exempt under this Paragraph.

Fiscal impact

The Office of Legislative Auditor found that the measure did not result in a direct material effect on governmental expenditures. The office was unable to estimate the potential impact on the state due to a lack of information on how many local governments would be affected. Read the full report here.

Support

Rep. Charles R. Chaney (R-19) and Sen. Francis C. Thompson (D-34) sponsored the measure in the Louisiana Legislature.

Arguments in favor

The Public Affairs Research Council of Louisiana found the following arguments against the measure:

“

This amendment would clarify the intent of the Constitution to tax property in Louisiana owned by other states or local government bodies in other states. A recent Louisiana appeals court decision has incorrectly refused to heed the Louisiana Supreme Court’s guidance that has been followed for nearly 65 years on this issue. This amendment is needed now to rectify this errant court ruling and to require Louisiana parish assessors and sheriffs to collect taxes that are rightfully theirs. Local governments are under financial strain and should be allowed to collect taxes owed by out-of-state entities. The neighboring states of Texas and Mississippi already make it explicit that their property tax exemption only applies to their state and local subdivisions. As the Louisiana Supreme Court long ago stated, there is “no reason whatever to believe that the people of Louisiana, in adopting their Constitution, intended to exempt from taxation the local property of foreign countries, other states or their political subdivisions.”

”

The League of Women Voters of Louisiana 2015 constitutional amendments analysis listed the following arguments supporting the measure:

“

Wise use of natural resources Source of revenue No apparent impact on state Provides equality in related laws with the states of Texas, Arkansas, Mississippi and Tennessee Sets precedent for future situations involving water, timber and other resources

”

Opposition

Arguments against

The Council for a Better Louisiana, or CABL, argued:

“

As it stands, the state constitution exempts public property used for public purposes from taxation. West Carroll Parish tried to tax natural gas the city of Memphis stored there, which could yield the parish $400,000 a year in revenue. But two court rulings said the constitutional exemption applies, so the parish can't tax the stored gas. "An extra $400,000 would clearly mean a lot to a place like West Carroll Parish, but that’s not really the issue here," CABL says in opposing the amendment. "It’s not good policy to change the constitution for isolated situations or when a court ruling results in a different outcome than some would like."

”

The Public Affairs Research Council of Louisiana found the following arguments against the measure:

“

The current Constitution needs no tweaking on this issue and its clear language should not be lightly disregarded. A recent appeals court decision correctly interpreted the plain and unambiguous language and intent of the Constitution and the issue should rest there. The Louisiana Constitution states “public lands” and “other public property used for public purposes” shall be exempt from property taxation. The exemption should be available for all state governments and their political subdivisions. The Legislature should not ask voters for an amendment every time a court interprets the Constitution in an unfavorable way to a parish government or other narrow interest.

”

The Louisiana Association of Business and Industry argued:

“

The Louisiana Constitution authorizes the imposition of ad valorem property taxes by the state and its local governments but provides an exception for “public property held for a public purpose.” Recently, there was a court decision that the city of Memphis, Tennessee, in storing natural gas owned by the city of Memphis in a storage facility located near Epps, La., fit that exception, resulting in a loss of ad valorem tax collection in excess of $400,000 to the parish of West Carroll. The proposed Constitutional Amendment would specify that the “public property” exception does not apply to land or property owned by other states or their political subdivisions. LABI does not oppose this concept. However, the proposed amendment fails to extend this same exception to property owned by foreign countries. In addition, poor wording of the amendment language could have the unintended consequence of other states or their local governments – that would be required to pay property tax if the amendment passed – beginning to use Louisiana’s inventory tax credit, increasing the cost of the credit to the state.

”

The League of Women Voters of Louisiana 2015 constitutional amendments analysis listed the following argument against the measure:

“

Slight possibility of a federal court challenge by another state or out of state political sub-division.

”

Media editorials

The New Orleans Advocate argued:

“

If you want the definition of an obscure issue rising to the level of a statewide ballot proposition, look to West Carroll Parish. In this poor and rural parish, with a very limited property tax base, the local assessor and sheriff levied property taxes on an out-of-state natural gas facility owned by the municipal power company of Memphis. Because the Louisiana Constitution prohibits taxation of “public lands” and “other public property used for public purposes,” Tennessee sued and won, saying that language applies to their public property as well as that of a Louisiana city or parish. That still might be appealed, but the amendment intends to reverse the court’s decision. While it is certainly important to West Carroll Parish, we believe this should be settled by the courts without the Legislature getting involved. It appears the courts may agree ultimately with the Tennessee plaintiff that the “public property” exemption does apply to the property of other states. If the amendment passes, though, does it also allow taxation of property of foreign countries? And if it passes, should Memphis be eligible for an offsetting state tax credit? That would be good for West Carroll but bad for state taxpayers as a whole. For those reasons, the Louisiana Association of Business and Industry opposes Amendment 4. Louisiana’s inventory tax has been stretched by local government into a way to tax oil and gas companies. The cost is passed on to the state by the inventory tax credit. The credit was originally intended to promote warehousing of manufactured goods, not as an indirect state subsidy for local governments who tax oil and gas as inventory. This is an outlier case of a larger sin, and that is the extension of property tax liability for liquid inventories, passing the cost on to the state via the inventory tax credit. For the purposes of Amendment 4: Let the courts settle it, and let the parties and the state live with the consequences.

”

Rolfe McCollister, publisher of the Greater Baton Rouge Business Report, urged a vote against the amendment:

“

PAR notes that our constitution says “public lands” and “other public property used for public purposes” is exempt from taxes. The courts ruled that could apply to any public entity, including Memphis, Tennessee, which rents storage in West Carroll Parish. This is a very narrow amendment affecting one parish, which wants to tax the gas inventory, which is “public property.” The courts said no. Now this parish wants to change the constitution. Not a good idea.

”

Path to the ballot

See also: Amending the Louisiana Constitution

The proposed constitutional amendment was filed by Rep. Charles R. Chaney (R-19) as House Bill 360 on April 2, 2015.

The measure needed to be approved through a two-thirds vote in both legislative chambers to be placed on the ballot. Louisiana is one of sixteen states that require a two-thirds supermajority for a constitutional amendment.

On May 27, 2015, the Louisiana House of Representatives approved the amendment, with 99 representatives voting "yea" and zero voting "nay." The Louisiana Senate unanimously passed the measure on June 8, 2015.

House vote

May 27, 2015, House vote

Louisiana HB 360 House Vote
Result		Votes	Percentage
a Yes		99	100.00%
No		0	0.00%

Senate vote

June 8, 2015, Senate vote

Louisiana HB 360 Senate Vote
Result		Votes	Percentage
a Yes		37	100.00%
No		0	0.00%

State profile

Demographic data for Louisiana
	Louisiana	U.S.
Total population:	4,668,960	316,515,021
Land area (sq mi):	43,204	3,531,905
Race and ethnicity**
White:	62.8%	73.6%
Black/African American:	32.1%	12.6%
Asian:	1.7%	5.1%
Native American:	0.6%	0.8%
Pacific Islander:	0%	0.2%
Two or more:	1.8%	3%
Hispanic/Latino:	4.7%	17.1%
Education
High school graduation rate:	83.4%	86.7%
College graduation rate:	22.5%	29.8%
Income
Median household income:	$45,047	$53,889
Persons below poverty level:	23.3%	11.3%
Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2015) Click here for more information on the 2020 census and here for more on its impact on the redistricting process in Louisiana. **Note: Percentages for race and ethnicity may add up to more than 100 percent because respondents may report more than one race and the Hispanic/Latino ethnicity may be selected in conjunction with any race. Read more about race and ethnicity in the census here.

Presidential voting pattern

See also: Presidential voting trends in Louisiana

Louisiana voted Republican in all seven presidential elections between 2000 and 2024.

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See also

Suggest a link

• 2015 ballot measures
• Louisiana 2015 ballot measures
• Louisiana Legislature

External links

• House Bill 360
• Louisiana Constitutional Amendments For Consideration for October 24, 2015 Ballot
• Public Affairs Research Council Guide to the 2015 Constitutional Amendments
• League of Women Voters of Louisiana's 2015 proposed constitutional amendments analysis