Paradigm Tax Group Industry News

Paradigm Tax Group Industry News

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    Texas Lawmakers Consider Property Tax Cap, School Funding Reform

    22 Jan, 2019

    Texas school finance and property taxes are once again a major topic of discussion at this year's legislative session. Senate leaders House Speaker Dennis Bonnen, Gov. Greg Abbott and Lt. Gov. Dan Patrick say it's the time to systematically change the way schools are funded and ensure that students and teachers are better off, while also slowing skyrocketing property tax bills as a result. However, there a many different ideas on the most effective way this will be accomplished. Abbott said he wouldn’t be satisfied with anything less than a landmark overhaul, but Dale Craymer, president of the Texas Taxpayers and Research Association, predicts it will be will be evolutionary rather than revolutionary.

    According to The Dallas Morning News, the House and the Senate both released preliminary state budgets calling for billions of dollars more in state revenue to go toward public school funding. The House called for a $9 billion increase while the Senate version called for $6 billion increase. Plans to change school funding have also provided an opportunity for legislators to give property owners some relief. Texans have long complained their property tax bills go up every year, and more than half of that bill is driven by local taxes collected for schools. Abbott’s plan would limit growth in school property taxes to no more than 2.5 percent each year. An increase in state dollars would offset any losses in school revenue to the district created by the cap. Abbott’s plan would also force school districts to lower their property tax rates as property values rise.
    However, property tax caps could be a hard sell for Democrats who aggressively fought them during the last session when lawmakers sought to impose them on cities and counties due to concerns that the caps could limit school districts’ ability to raise money when needed. Rep. Chris Turner said revenue caps aren’t the only way to give property tax relief. He noted the state could repeat what it did in 2006 by cutting taxes for school districts, while offsetting the losses with new state dollars. He also noted that increasing the state’s homestead exemption might be a more direct way of providing property tax relief. Kara Belew, an education adviser for the group, said the state shouldn’t increase total school funding and instead more aggressively replace local property tax dollars with any additional state revenue. “We think Texans are going to want their bills lowered — genuinely lowered,” Belew said, noting that most plans on the table will only slow how fast the bills increase.
    For the full article from The Dallas Morning News, click here

    Topics: Real Property, Texas