House Republicans are retrospectively arriving at a sweeping consensus—not enough was done to curb property tax increases. But if members supporting the coalition government of liberal House Republicans and Democrats had their way, Texans would pay even more.
That’s because the competing proposal the House advanced wasn’t to make the cuts larger—it was to leave property taxes untouched altogether. The coalition-led House originally attacked the Senate property tax cut plan, deriding it as “gimmickry,” only to later admit it was in fact a cut, but allegedly too small for anyone to “feel.”
Now they’re bragging about it passing, hoping primary voters overlook their flip-flopping on both claims by saying the measure is indeed a cut, although technically only a reduction in an increase. And many people will “feel” the cut, but only homeowners with “lower home values.”
The most legitimate criticism of property tax reform draws from the experience of the 2006 property tax for franchise tax swap. In the years following that “cut,” the franchise tax became a growing burden on Texas businesses while the property tax reduction evaporated through rising appraisals and local school districts raising rates.
It was the experience in 2006 that informed the Senate’s proposal this session —it “indexed” the homestead exemption, allowing it to automatically rise over time with inflation in median home values. This would have preserved the cuts from appraisal increases over the long haul.
While the House conferees sent to kill the Senate’s original bill ultimately failed, they were successful in watering it down by stripping the indexing provision, weakening the cut’s long-term benefit. In other words, the House conferees did their best to guarantee that their doom and gloom predictions about property tax relief would come true.
Now that the session is over, everyone conveniently concedes that rising property taxes are a huge problem.
A study done by the House Ways and Means Committee showed that, despite a $10,000 increase in the homestead exemption, rising appraisals will likely result in the average Texan paying a higher total school tax burden. Instead of mitigating that problem, House conferees were successful in exacerbating it.
How can House leadership be sincere in taking such a position, or take credit for “property tax cuts,” when they aggressively fought reform the entire session before crippling the final version?
During debates on the property tax cut, House leaders were quick to point the blame at local officials. They were correct in pointing out that Texans need to work harder to hold their local officials accountable when they raise tax burdens, not just tax rates. Yet the coalition-led House refused to do anything to empower taxpayers at the local level.
No bill passed either chamber that curbed appraisal increases or lowered the rollback rate. Similarly, no measure moved that would limit the ability of localities to increase tax burdens without local voter approval. Measures to move local elections to the uniform November election date and to guarantee greater ballot transparency were also stifled.
As a result, even if voters approve the higher homestead exemption for local school taxes in November, local governments will continue to grow tax burdens. And local school taxes will still grow, albeit at a slower rate.
The army of local government lobbyists aided by House leadership largely won, again.
With Republicans anxious to court conservative constituents in 2016, primary voters shouldn’t forget just how hard key House members fought against the modest tax reform plan everyone now admits wasn’t enough—nor should they forget who watered it down at the behest of Democrats.