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Gov. Greg Abbott, Lt. Gov. Dan Patrick, and Texas House Speaker Dennis Bonnen have announced the long-anticipated “big bill” on property tax reform for legislators to consider during the 86th Texas Legislative Session.

In an unprecedented move, an identical bill was filed in the House and Senate by State Rep. Dustin Burrows (R–Lubbock) and State Sen. Paul Bettencourt (R–Houston), respective chairs of each chamber’s tax-writing committee and their Republican caucuses. House Bill 2 and Senate Bill 2 were filed Thursday morning ahead the jointly held press conference.

But what exactly does the bill do?

Here are the highlights, as distributed by Bettencourt’s office:

(1) Lower the rollback rate from 8 percent to 2.5 percent for taxing units that collect more than $15 million in tax revenues and establish election notice requirements based on whether a school district will or will not exceed a 2.5% rollback rate for Maintenance and Operation property tax.

(2) Requires an automatic tax ratification election in November if the rollback rate is exceeded in a taxing unit.

(3) Creates a property tax administrative advisory board that recommends improvements to the effectiveness and efficiency of the property tax system, best practices and complaint resolution procedures.

(4) Make information about the tax rates proposed by local taxing units online with a, “real time tax rate notice”, for taxpayers and defines easy to understand, “no new revenue tax rate”, limits for the public, and;

(5) Reforms appraisal process on ARB hearings, ARB votes, and requires all appraisal districts to follow appraisal manuals issued by the Texas Comptroller for better transparency, accountability, and consistency.

It is important to note that, as it pertains to the rollback rate, taxing units – not including school districts – that collect less than $15 million in tax revenue annually are exempted from the change and will retain the current rollback rate of 8 percent.

The renaming of the effective tax rate as the “No-New-Revenue tax rate” in addition to the mandatory notice requirement, which includes the names and contact information for the elected officials who vote on the adoption of tax rates, will both be welcome policies for the everyday taxpayer. Simplifying, notifying, and plainly stating whether constituents’ tax rates will be increasing, decreasing, or remaining unchanged are measures that will surely foster in a sense of accountability between the voter and candidates for office, incumbent or otherwise.

Policy experts have praised the plan, noting that it moves the state in the right direction on affording taxpayers the relief they have demanded for more than a decade. The Texas Public Policy Foundation, Texas’ preeminent not-for-profit think tank released several plans of its own for lawmakers to mull on this issue but did not hesitate to praise the announcement.

“Slowing the growth of skyrocketing local property taxes provides much-needed reform,” said Vance Ginn, Ph.D., TPPF’s senior economist and director of the Center for Economic Prosperity. “This is a positive step toward providing taxpayers the support they are looking for and we are eager to work with leadership on securing the greatest relief possible.”

With property tax reform widely expected to be among the emergency items Abbott announces in his State of the State speech next Tuesday, both chambers will begin work on crafting a final version of the bill to eventually reach the governor’s desk.

The Senate Committee on Property Tax is scheduled to hold its first meeting Wednesday, February 6.

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