On Friday, the Texas House of Representatives gave final approval to legislation purporting to provide property tax relief for Texans.
Texans’ Increasing Property Tax Burdens
Texans across the state are reporting ever-increasing property tax burdens and hoping to receive tangible property tax relief out of the ongoing special legislative session.
In March of this year, the Tax Foundation reported that Texas is ranked as the state with the sixth-highest property tax rate, preceded only by Connecticut, Vermont, New Hampshire, Illinois, and New Jersey.
Despite campaign promises from Republican lawmakers, who have controlled the state Legislature and every statewide office for nearly two decades, Texans have seen their property tax burdens increase by 181 percent in that time, continuing to quickly outpace several other states.
Property tax relief was not something that was prioritized in the 87th regular legislative session that concluded in May. Gov. Greg Abbott did add it as an item to be considered on his agendas for both the first and ongoing second called special legislative sessions.
Ongoing Second Special Legislative Session
Now, both the Texas Senate and Texas House of Representatives have chosen to prioritize three bills to fit the agenda item prescribed by Abbott.
One of these bills would allow for someone who acquires property to also qualify for the homestead exemption from property taxes within the first year of that acquisition. The others would put it to voters to compress tax rates for those over 65 or disabled. Altogether, supporters of those bills believe they will provide some property tax relief over the next few years, although some critics believe it is nowhere near enough to lessen the ever-growing property tax burden on Texas taxpayers.
According to Tim Hardin, executive director of Texans for Fiscal Responsibility:
Texas legislators have been given a golden opportunity to begin eliminating the school property tax forever. HB 122 is the strongest bill of the second called special session. By using the budget surplus to pay down school property taxes, Texas has a real path to school property tax elimination.
Sadly, the House and Senate have decided to answer Abbott’s call for property tax relief with more tax carve-outs for special classes and do-nothing legislation. Exempting certain groups from property tax increases only results in increased property taxes for everyone else. This is not the relief Texans have been screaming for.
Abbott and the Legislature should heed the voice of Texas taxpayers and move quickly on passage of HB 122, finally providing meaningful property tax relief for homeowners.
House Bill 122, by State Rep. Tom Oliverson (R–Cypress), would actually provide property tax relief that could be felt by taxpayers in Texas. If passed, it would do this by bringing the school maintenance and operations (M&O) taxes down to zero by using the budget surplus to “buy down” those rates. (Brass tacks: The bill provides a framework for school M&O tax rates to approach zero by having the state provide for that decrease.)
When the bill was filed, Vance Ginn, the chief economist for the Texas Public Policy Foundation, said:
Texans want a lower property tax bill, and our goal is to eliminate it as fast as possible. The Legislature can help achieve this by using most if not all the state’s $7.85 billion surplus to reduce school district maintenance and operations property taxes, which comprise nearly half of total property taxes levied statewide, now and then pass HB 122 to eliminate the rest of it by 2041. By following this approach of limiting government spending and returning money to taxpayers, Texans can prosper for generations to come.
Oliverson’s bill was referred to the House Appropriations Committee on August 23. It has not yet been scheduled for consideration. With only 10 days left in the ongoing special session, time is running out for the Texas Legislature to provide tangible property tax relief that can be felt by Texans well into the future.