The LVT Landscape #1: Movement Across the U.S.

Land value tax legislation is gaining momentum across America, with developments in over six states.

Hello,

Welcome to the inaugural edition of LVT Landscape. I intend to use these blog posts to track the growing momentum for land value tax adoption across America. While policy change moves slowly, encouraging developments are emerging in legislative chambers throughout the country. In this issue, I'll highlight LVT initiatives currently advancing in jurisdictions across the United States.

Maryland

As an independent city that operates as both a city and county, Baltimore finds itself in a unique regulatory position.

Cities in Maryland enjoy the right to set a “special rate for any class of property,” which allows cities to adopt different rates on land as improvements. Baltimore, however, is bound by the same regulations as other counties which require a “single county property tax rate” applied uniformly to land and buildings. These varying permissions represent a strange quirk in state regulation that has limited Baltimore's ability to address vacancy and blight in the city.

Last year, Baltimore–and Maryland counties–got the right to tax vacant units. With the new privileges, Baltimore acted quickly and approved a tax hike on vacant properties to help address blight in the city.

The job is not done. City councilmember Zac Blanchard has been an active voice pushing for comprehensive land value taxes in Baltimore. And, while it’s still an uphill battle to get passed this legislative session, Maryland has two bills focused on enabling Baltimore and counties to levy a larger tax on land than buildings.

HB1178 was introduced by Delegate Caylin Young to provide full tax parity to Baltimore, giving it the same right to set different rates on building and improvements as other cities. The bill now boasts 8 co-sponsors.

SB 472 was introduced this month by Senator Jim Rosapepe and allows Baltimore, and counties, the right to set a higher land tax rate but specifically for land within one mile of rail. While restrictive, this bill could be a massive boost for Baltimore. The land around transit is the most valuable and should be the most developed. Almost half of all land value in Baltimore is within one mile of rail.

Spokane

Washington State is second only to Florida in regressivity of taxes, largely due to its heavy reliance on sales taxes. This dependence stems from the absence of a state income tax combined with significant constitutional limitations on property taxation.

The state constitution caps the total tax revenue to only 1% of the total property value in the city. Additionally, state regulation limits annual growth in municipal property tax revenue at 1% without voter approval. These dual constraints force cities into a difficult position.

With limited options for property taxation and no access to income tax revenue, Washington municipalities must lean heavily on sales taxes to fund essential services. This creates a system where lower-income residents typically pay a much higher percentage of their income in taxes than wealthy residents, cementing the state's position as one of the nation's most regressive tax environments.

Spokane is interested in adopting a land value shift but cannot due to the Washington state constitution. City council members voted 5-2 to make authorization a key priority in their state legislative focus. A land value tax shift would allow Spokane to more effectively utilize its limited property taxing authority, generating necessary revenue while simultaneously encouraging development by taxing unimproved land at higher rates than developed properties. Given the strong council support and the potential economic benefits, Spokane is likely to continue advocating for this constitutional change in upcoming legislative sessions.

Minnesota

Minnesota has active legislation (SF1422) that would enable municipalities to implement land value taxes. The bill, introduced this month by Senator Omar Fateh with two cosponsors, would allow cities to shift their property tax burden toward land values. The movement in Minnesota has built a strong coalition, including from environmental, transit, and pro-housing organizations.

Rich Nymoen, President of Common Ground USA and its Minnesota chapter, is optimistic about the bill's progress: "Given the legislature's power sharing challenges this year, we're very happy that the LVT bill has already received a hearing in the House Taxes committee. Afterward, we heard there was bipartisan interest in at least authorizing an LVT pilot project in Minneapolis. That would be a welcome step forward."

New York

S1131 is sponsored by State Senator Rachel May who represents upstate New York including the core downtown of Syracuse. The bill, as introduced, would allow for up to five municipalities to implement a land value tax as a pilot program. Assembly member Alex Bores has introduced companion legislation in the Assembly (A3339) to match the Senate bill.

LVT Study Bills

Oregon (HB2124) and Virginia (HJR451) both have bills or resolutions to direct departments within their state government to study the impact of land value taxes.

Virginia already allows four municipalities to enact land value taxes, and they have another bill to provide parity for all municipalities to have the same right (HB1561). However, Virginia's legislative session ended on February 22nd, and HB1561 was tabled for the next session in April.

Michigan

Finally, late last year, Detroit’s Mayor, and LVT champion, Mike Duggan announced a run for governor of Michigan as an independent. Duggan speaks about the issue with elegance. He avoids the high-level theory and utopian visions that often bog down the land value tax movement. Instead, he focuses on telling the story of the people of his city. I particularly like his 2023 keynote address at the Mackinac Center which makes a strong, pragmatic case for land value taxes in Detroit.

Prediction markets, for those who follow them, have him at a 15% chance of winning, likely a reflection of his uphill battle running as an independent.

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Have an update from your area or know an elected official interested in LVT? I'd love to hear from you! Email me at greg@landeconomics.org. And if you found this update valuable, please consider sharing it with others interested in tax reform and urban revitalization.