Average homeowners’ 2019 property tax bills from eight school districts in Denton County grew, even though Texas lawmakers passed reforms last year that allotted roughly half of the state’s surplus tax revenue to reducing school property taxes. School districts—which have not had in-person classes since mid-March—are now setting their budgets and tax rates for the upcoming school year.
For years, homeowners’ property tax bills have continued to grow, and roughly 60 percent of a homeowner’s total property tax bill is from school districts. In 2019, the Texas Legislature passed House Bill 3—which poured $5.1 billion of the more than $10 billion tax revenue surplus into compressing independent school district (ISD) tax rates.
Lawmakers claimed HB 3 “lowers school property tax rates by an average of 8 cents in 2020 and 13 cents in 2021,” or an implied total of 21 cents over two years. However, according to the Texas Education Agency, this is inaccurate. First, the average estimated school tax rate “compression” (or reduction) of 8 cents per $100 of property valuation will affect property taxes paid in the 2019 tax year, not in 2020. Second, there is no additional “13 cents” tax rate compression as the result of a state buydown in 2020.
Only six districts in Denton County showed a one-year decrease in 2019.
Slidell ISD board members approved the highest one-year growth at over 22 percent. This growth happened even though their property tax rate was cut over $0.05 per $100 property valuation—from $1.1275 in 2018 to $1.07 in 2019. Year-to-year comparisons of tax rates are meaningless, as the average taxable value of properties fluctuates every year. Slidell’s rate wasn’t lowered enough to offset the over 28 percent increase in the average taxable value of single-family homes—$64,027 in 2018 to $82,453 in 2019.
The no-new-revenue rate is the property tax rate that—in the aggregate—offsets increases in the average taxable value of properties. If adopted, homeowners’ property tax bills, on average, would not significantly increase from the previous year.
Average homeowners in Argyle ISD actually saw a one-year decrease of 4.58 percent in their property tax bill—$7,037 to $6,714—and Northwest ISD had a decrease of 1.83 percent—$4,610 to $4,526.
From 2013 to 2019, all ISD board members approved no less than 29 percent growth in their average tax bills for homeowners. Slidell ISD had the highest six-year growth of over 129 percent—$384 to $882. Argyle ISD had the lowest increase at over 29 percent—$5,192 to $6,714.
The TEA confirms there will be a tax rate cut in 2020—the amount of which will vary from district to district—but says it will be provided via a different mechanism: a 2.5 percent cap on property tax revenue. Regardless of what appraisal assumptions are used, this change cannot mathematically result in a tax rate cut of 13 additional cents.
Over 2 million Texans lost their jobs in 2020 as a result of government policies that shut down the Texas economy in response to the Chinese coronavirus.
Below is the data tracking the changes in average homeowners’ property tax bills from school districts in Denton County. School districts in the metroplex area tend to vote on their budget and tax rates sometime between May and June. Concerned taxpayers may contact their elected school board members.
Click the image below for details.