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HB 1775

Limiting liability for salmon recovery projects performed by regional fisheries enhancement groups.

2023-2024 Regular Session Introduced by Mike Chapman and 3 co-sponsors

HB 1775 would require owner-occupied homes with ADUs on the same parcel to be valued and taxed as a single residential parcel, not as separate parcels, starting 2026.

Effective date 7/23/2023.
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Bill Summary · HB 1775

Summary — HB 1775 (95th General Assembly, 2025) — Accessory Dwelling Units and Property Tax Valuation

Note on source materials: The documents provided contain inconsistent metadata (an unrelated Greenwood Utilities title and an Illinois bill text). This summary focuses on the Arkansas HB 1775 text and DFA Fiscal Impact Statement included in the packet, which amend state property‑tax valuation law for accessory dwelling units (ADUs).

Purpose / Intent

HB 1775 would have prohibited the separate valuation and assessment for property‑tax purposes of accessory dwelling units (ADUs) when they are located on the owner’s principal residence parcel. The bill’s intent is to require the owner’s primary residence and any ADU on the same parcel to be valued and assessed as a single residential parcel.

Key provisions

  • Amends Arkansas Code § 26-26-1202(a)(1) (valuation procedures) to add a new subsection preventing subdivision of owner‑occupied residential property into multiple parcels to create a separate parcel for an ADU.
  • Requires that residential property used as the owner’s principal place of residence — including any accessory dwelling unit on the same parcel — be valued and assessed as a single parcel.
  • Defines “accessory dwelling unit” as a secondary dwelling unit that:
    • Is located on the same parcel as the primary single‑family residence;
    • Is independent of and smaller than the primary single‑family residence; and
    • Is owned by the same person as the primary single‑family residence.
  • Effective date: applies to assessment years beginning on or after January 1, 2026.
  • Cross‑reference: the bill cites a change to valuation method under Arkansas Constitution, Article 16, § 5.

Who is affected

  • Homeowners: Owners of single‑family residences with ADUs on the same parcel would have their primary residence and ADU assessed together (not as separate taxable parcels).
  • County assessors and reappraisal staff: Assessment practices would change; assessors would be prohibited from creating separate parcel records for ADUs owned by the same owner.
  • Mortgage companies/escrow agents: May require notification where parcel records are combined for escrow purposes.
  • Local taxing entities: Potential (likely minimal) impact to local property tax collections.

Fiscal and administrative impacts

  • State revenue: Department of Finance and Administration (DFA) estimates no impact to state revenues.
  • Local revenue: DFA notes a possibility of a minimal revenue impact to local property tax collections.
  • Administrative resources: Training and guidance updates required for county assessors, ACD (Assessment Coordination Division) guidance updates, and time to combine previously separated parcels. Counties with many residential parcels may need additional time to implement changes.

Procedural changes / enforcement

  • County assessors would be barred from creating or approving subdivision of the owner’s residential parcel to create a separate taxed parcel for an ADU; requests by taxpayers to subdivide an ADU into its own parcel could not be granted.
  • The DFA commentary notes current practice often separates dwellings when they are income‑producing; this bill would prevent separation for owner‑occupied primary residences.

Sponsors, related measures, and status

  • Sponsors: Representative Lundstrum (primary) and Senator C. Penzo (primary listed elsewhere); documents list Lundstrum and Penzo as sponsors.
  • Related bill: SB 608 (companion).
  • Legislative status: Introduced January 8, 2025. The document package indicates HB 1775 died in committee (Died in House Committee at sine die adjournment / Died in Committee) and did not become law.

If you want, I can: (1) draft a one‑page explainer for homeowners on how this would have changed assessments; or (2) produce suggested amendment language to address specific concerns (e.g., treatment of income‑producing ADUs).

Compiled from official sources — confirm details with the bill’s official record.

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