Committee delays bill to define disabled veterans' homestead exemption after acreage and rental questions

Representative Charlene Fyde presented House Bill 11-43, introduced by the Arkansas Collectors Association, saying the measure would define "homestead" for the disabled veterans property tax exemption and make the definition consistent across counties. "This bill clearly defines what a homestead is and what will be tax exempt," she said, and noted she added an amendment to clarify that commercial property would not be exempt.

County collectors and witnesses described inconsistent county practice: "Some county collectors have used the definition of 40 acres. Some counties have used 10 acres. Some, if you 1 acre," said Josh Curtis of the Association of Arkansas Counties, noting the association's intent to give maximum leeway to disabled veterans while eliminating uneven treatment between counties. Collectors said the lack of a uniform definition has caused problems when veterans move between counties.

Several senators raised concerns about potentially exempting very large contiguous parcels (examples discussed included 40 acres, 1,000 acres and farming uses). Senator Caldwell proposed an amendment to limit contiguous noncommercial exempt property to 40 acres to address those concerns. Committee members also questioned how rental income or rental of farmland would be treated and whether assessors could reliably distinguish commercial uses at the parcel level.

Given the outstanding questions on acreage limits, rental versus commercial definitions and drafting details, a member moved to pull the bill down for further work. The chair agreed; the committee will return the bill after consulting drafting attorneys and preparing language addressing the members' concerns.

Why it matters: The bill seeks to standardize eligibility for a tax exemption that affects disabled veterans and their surviving spouses and dependents across Arkansas counties. Lawmakers emphasized the policy intent to protect veterans' primary residences while guarding against unintended broad exemptions for commercial or large recreational land.