Texas voters approved Propositions 1 and 2, offering modest property tax relief

Home prices are skyrocketing in Texas, and so are property taxes. Texas voters approved Proposals 1 and 2, which provide modest property tax relief to homeowners.

By Joshua Fechter
The Texas Grandstand

As the state’s housing market rages, Texas homeowners will enjoy a slight reduction in their property tax bills after Texas voters overwhelmingly passed a pair of nationwide ballot measures. of the state on Saturday.

Voters approved two proposals to cut property taxes for homeowners by sweeping margins — one aimed at elderly and disabled Texans and another that would provide some relief to homeowners across the board.

“Victory for ALL Texas landowners!” Gov. Greg Abbott tweeted Saturday night.

Texas’ high property taxes once again took center stage amid the state’s booming housing market. Home values ​​in the state’s major metropolitan areas have jumped double digits, prompting homeowners to worry about seeing a similar rise in their property tax bills – although these don’t necessarily go hand in hand .

Proposition 1, a measure essentially aimed at reducing school district property taxes for homeowners age 65 and older or with disabilities, has been widely adopted, according to Decision Desk.

The vast majority of voters also approved Proposition 2, to increase the state’s homestead exemption — the dollar amount of a home’s value that is exempt from tax by school districts — from $25,000 to $40,000. The owner of an average Texas home worth about $300,000 will save about $175 on their annual property tax bill, said Republican Senator Paul Bettencourt of Houston, who authored the proposals.

“It’s great to see Texas voters voting overwhelmingly for property tax relief,” Bettencourt said Saturday. “They recognize the evidence that Texas properties need it.”

The projected savings under Proposition 2 are only a fraction of a given homeowner’s property tax bill.

“It’s not that meaningful,” said Chandra Kring Villanueva, program director of left-leaning nonprofit Every Texan that focuses on school finances. “What it’s really doing is slowing the growth of the school tax bill rather than seeing a real saving for the majority of homeowners.”

State lawmakers are trying to find other ways to cut property taxes or at least slow their growth — a favorite issue for Republicans in Texas. Lt. Gov. Dan Patrick has asked a state Senate committee chaired by Bettencourt to review property tax reform measures or cuts before the next session of the Texas Legislature in January.

“I expect there’s more to do, obviously, than that,” Bettencourt said. “But the good news is no matter what, it’s $175 in people’s pockets in perpetuity.”

Property tax bills for Texas homeowners are among the highest in the nation – the result of the state’s reliance on property taxes to fund local governments, especially public schools, as well as the lack of tax on state revenue. In general, the amount of property taxes a homeowner owes in a given year depends on the tax rates set by the cities, counties, and school districts where they live and the value of their home.

Measures are in place to try to slow the growth of property taxes. Under state law, the assessed value of a homeowner’s principal residence cannot increase by more than 10% in any given year if they qualify for a homestead exemption.

Three years ago, state lawmakers capped school district tax rates and required cities and counties to seek voter approval if they wanted to raise their total tax revenue by 3.5% or more than the previous year. These laws have slowed property tax growth, according to a recent report by the Texas Taxpayers and Research Association — but not entirely.

The issue has come to the fore in the race for governor – Abbott and Democratic opponent Beto O’Rourke presenting dueling proposals.

Abbott has launched a “taxpayer bill of rights” that includes ideas to further reduce school property tax rates, make property assessments more transparent, and limit the ability of local governments to take on new debt without first asking voters.

O’Rourke, meanwhile, said the state should claw back 50% of public school spending and suggested legalizing marijuana, casino gambling and sports betting as ways to generate more tax revenue.

Meanwhile, state lawmakers are considering a $12 billion surplus in state revenue to pay for some public school costs so districts can lower their property tax rates. Texas is also suing the federal government for the right to use $3 billion in federal stimulus funds to pay for tax cuts.


Disclosure: Each Texan and the Texas Taxpayers and Research Association financially supported The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the journalism of the Tribune. Find the complete list here

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2022/05/07/texas-property-tax-constitutional-amendments-proposal/.

Penny D. Jackson