City leaders say property tax offers little relief, lots of pain

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A local official said, a property tax reform bill aimed at slowing the growth of tax rises in Texas would confine the flexibility of local governments to pay for police and firefighters, construct new roads and provide essential services while giving homeowners minimal relief from rising tax bills.

Recorded a month ago, Senate Bill 2 would require cities or countries to look for voter endorsement for any property tax rate increase that surpasses 4%. Right now, the law takes into account for hikes up to 8% without setting off a rollback election.

The measure would save a little more money of taxpayers because the municipal property tax represents just 16% of the taxes paid by Texans, City officials in Tarrant County Appraisal District (TAD) said. (About 50% of local taxes go to school districts.) But it could largely affect city budget.

Fort Worth Mayor Betsy Price stated that the bill would curtail the city’s ability to provide roads, infrastructure and public safety for a fast-growing population. She says the 8% cap has given the city the flexibility to “do what we needed to do” in good times and bad.

Arlington Mayor Jeff Williams says it’s too early to decide the bill’s real impact the Legislature doesn't meet until one month from now but noted that it’s well known that costs keep rising.

Texas State Senator, Paul Betterncourt, author of the bill, discovers that the comments by city officials are not straight forward. He said local governments can simply go to the voters and seek approval.

According to his Senate Select Committee on Property Tax Reform and Relief, a 90-page report shows an average home property tax appraisals have risen 22-24% over the past two years in the Fort Worth area and 20% in San Antonio. But the report indicates that from 2011 to 2015 levies jumped 14% in Fort Worth and 52% in Harris County.

Ability-to-pay

Bettencourt’s efforts to bring property tax relief to taxpayers has the support of Dan Patrick, Lieutenant Governor of Texas, who commissioned the select committee’s report and has assigned the reform bill to be a top priority in the upcoming legislative session. In a statement released after the report’s publication, Patrick voiced strong support for SB2 (Senate Bill 2).

Bettencourt, R-Houston, a former HCAD tax assessor-collector argues that as property appraisals in Texas increased because of its booming economy local taxing entities should have cut their tax rates because they were already getting more money from land valued at higher prices.

Instead, the committee’s report said that among the 4,039 taxing units in Texas, data from 2005 to 2015 shows tax levy increase of 93% for special districts such as utility and public improvement; 82% for the counties; 71% for the cities; and 39% for schools.

As a result, Texas now has the fifth-highest median property tax rate in the country at $2.17 per $100 of assessed property value, with only Illinois, New York, New Hampshire and New Jersey higher, the report says. At the same time, household median income went up 32% from 2005 to 2015, the study shows.

He said the bill would put in the same tax rate system as the school districts. It also removes the high petition threshold for calling a rollback election — 7% of registered voters in the larger cities.

Bettencourt said they want to stop government growing by “double digits.”

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