Property Tax Cap Bill, Which Would Shrink Local Government Budgets by $900 Million Heads to Senate

AUSTIN -- A bill to cap city property tax growth passed its first hurdle on Monday, and advances to a vote by the full Senate.The bill is projected to shrink city, county and special taxing district coffers by almost $900 million by 2021, according to an analysis by the Legislative Budget Board. Advocates of the bill note that reduction in local government dollars translates to a savings to taxpayers, who would have otherwise paid those dollars in their property tax bills. Senate Bill 2, authored by Sen. Paul Bettencourt, R-Houston, would cap local property tax growth for local governments and specialty taxing districts -- which include utilities, hospitals and community colleges -- at 2.5 percent. To exceed the cap, voters would have to approve the increase. The Legislative Budget Board's analysis is based on the assumption no increases beyond 2.5 percent are approved. "Remember Texans are paying $60 billion in property taxes now, and that's going up at an astonishing rate," Bettencourt said Monday ahead of the committee vote. "The bill does provide real property tax relief. We want it to. Texans deserve it. They need it." The bill would also cap property taxes for school districts at 2.5 percent growth. But lawmakers have pledged to ensure school districts get an increase in state dollars to offset any losses in local revenue. The Senate Property Tax committee was created this year to take up property tax issues, which were named a priority by House and Senate leadership, as well as Gov. Greg Abbott. The committee's five members were chosen by Lt. Gov. Dan Patrick, a leading advocate of previous plans to cap local property tax revenue. Four of those members were co-sponsors of SB2 all of whom voted in support of it on Monday.The fifth member, Democrat Sen. Juan "Chuy" Hinojosa, D-McAllen, was present at the meeting but did not vote. A companion bill was filed in the House by Ways and Means chairman Rep. Dustin Burrows, R-Lubbock. The House version of the bill has yet to be assigned for a committee hearing. In 2017, the House was much more resistant to resistant to property tax revenue caps.   Continue reading...

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