Across North Texas’ fifty most populous cities, Southlake and Coppell collect the most property tax revenue per resident. As more sunlight is cast on the murky world of local government finance, it’s becoming clear that many politicians base their tax rates on whatever they can get away with, rather than what they actually need for services.

The result is higher than necessary tax bills for families and businesses, which hurts low and fixed-income Texans the most. The biggest benefactors of rising tax revenue resulting from economic development become bureaucrats with bloated budgets, not taxpayers.

Property tax hikes are particularly relevant now, since local politicians across the state are currently voting on next year’s spending and tax rates, a process they finalize every September.

Southlake is the biggest municipal property tax collector in North Texas, according to government data.

They’ve accomplished this by raising taxes without raising tax rates, by refusing to cut rates as property values, and the size of their tax base, rapidly rose. Over the last ten years, their property tax collections grew five times faster than their population, from $685 per person a year in 2005 to over $982 in 2014. This excludes sales taxes, fees, and other revenue.

Their property tax collections last year were 162% higher than the average city, and twice as high as Colleyville, Dallas, Frisco, Plano, and Wylie. Southlake isn’t starving for other revenue either. They collect the second highest sales tax revenue per person of any city in the region.

Coppell’s tax collectors don’t fall far behind, ranking second and third highest in property and sales tax revenue per person, respectively.

Unlike Southlake, the cost of Coppell’s government hasn’t skyrocketed over the last decade—it’s always been astronomically high, ranging between $750 and $860 per person. Again, it’s twice as high as the average city in the region.

It’s important to note: despite what many liberals claim, high tax revenue and spending doesn’t necessarily equate to “nicer communities” with more or “better” services. It does result, however, in paying more for many of the same government services. Remember, many luxurious suburbs have Home Owner’s Associations that charge residents additional monthly or yearly fees to pay for beautification and other perks. In these instances, HOAs (not city governments) pick up that tab.

Consider the city of Farmer’s Branch. Despite collecting the third most property tax revenue in the region on a per resident basis, few would consider it as desirable of an area as either Southlake or Coppell, let alone others far lower on the taxing list.

Although Coppell’s officials led by Mayor Karen Hunt recently voted to adopt a lower overall tax rate in 2016, they will still collect more money from the same taxpayers due to rising land values and a bigger base.

Coppell officials are choosing to maintain both historic per-resident revenue levels and its top-tax-collector status in the region. That’s because they’re actually increasing the portion of the rate that funds their budget (M&O). This is possible due to a cut in their debt service tax rate (I&S) mandated by state law, which occurs automatically as old debt is retired. As debt is paid off and the I&S rate is lowered, officials have chosen to simply raise their M&O tax to boost their budget even higher.

They could have alternatively either kept their M&O rate the same, allowing rising appraisals to still increase their revenue, or better yet, lowered the M&O rate and limited budget growth.

Despite worn out conservative-sounding “tax cut” rhetoric, you’d be hard-pressed to find a group of local politicians that actually reduces tax burdens, let alone any that keep them the same size.

All-too-often, tax rates are based on whatever politicians can sneak through without ruffling too many feathers, rather than levying on taxpayers what’s actually needed for services.

Southlake and Coppell provide more compelling evidence that reforms at the state and local level are needed to control the growth of government, in part, by limiting the taxing power of politicians.

Ross Kecseg

Ross Kecseg was the president of Texas Scorecard. He passed away in 2020. A native North Texan, he was raised in Denton County. Ross studied Economics at Arizona State University with an emphasis on Public Policy and U.S. Constitutional history. Ross was an avid golfer, automotive enthusiast, and movie/music junkie. He was a loving husband and father.