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Texas property taxes will keep climbing under SB 2

By   /   March 22, 2017  /   News  /   No Comments

Texans looking for property tax relief won’t find much in Senate Bill 2 because lawmakers half-stepped the process.

AP photo

SLOWDOWN: Sen. Paul Bettencourt says his SB 2 will bring tax relief in future years.

Homeowners in just 10 of 34 cities and counties surveyed would realize any savings under the bill passed by the Senate Tuesday.

The annual reduction on an average homesteaded property was calculated to range from $12.77 in San Antonio to $81.25 in Bryan, according to an analysis obtained by Watchdog.org.

Homeowners in several metro areas — including Tarrant [Fort Worth] and Nueces [Corpus Christi] — would see no change.

State Sen. Paul Bettencourt, R-Houston, hailed SB 2’s passage, saying his measure would “help slow the growth of future property tax bill increases.”

“This is a tremendous reform package,” he told Watchdog. Bettencourt noted that Fort Worth, Dallas and Houston cut their tax rates as SB 2 was filed.

But Galveston County Tax Assessor-Collector Cheryl Johnson said promises of reform and relief are exaggerated.

“Twenty-one million homeowners will see no relief from SB 2,” said Johnson, who compiled the study.

If Johnson’s assessment is correct, SB 2 could haunt state Republicans, including Gov. Greg Abbott and Lt. Gov. Dan Patrick, for again failing to deliver substantive property-tax relief.

Amid much fanfare, the 2015 Legislature raised the homestead exemption with promises of lower levies, but property tax bills continue to soar.

Galveston County photo

DO MORE: Galveston Assessor Cheryl Johnson says Texans won’t get real property tax relief until appraisals are capped.

Johnson said the Republican-dominated Legislature’s piecemeal approach isn’t enough.

“SB 2 is only one piece of the puzzle, and the GOP will lose elections because of this,” predicted Johnson, a Republican.

Until appraisals are capped, Johnson said tax bills will keep climbing. So she recommends a complete overhaul.

Lawmakers should “freeze everything and rewrite the [tax] code,” said Johnson, who favors a “price-paid” appraisal system to effectively freeze residential taxes while transferring commercial/industrial appraisal responsibilities to the state comptroller.

“That would spread the wealth across the state and equalize education funding. Then we’re done,” she said.

“If we don’t get a cap bill, do [legislators] want to come back in two years and do it all over again?” Johnson asked.

Bettencourt said Johnson’s proposals would require constitutional amendments, which need a two-thirds vote from both houses in the Legislature. “There’s no chance we can get that,” he said.

In the face of united Democratic opposition and a few wavering Republicans, SB 2 became the art of the possible.

Just before the clock struck midnight, the Senate Finance Committee lifted the lid on tax revenue increases from 4 percent to 5 percent to conform to a softer bill in the House — further eroding whatever small savings taxpayers might receive.

Bettencourt pointed out that 5 percent — versus the current 8 percent — marks the lowest rate since 1979. He asserted that SB 2 will rein in big-spending localities by automatically triggering tax override elections.

“Every year with a lower rate compounds the savings,” the senator said. “You get long-term tax relief year after year.”

CHART: Effects of an appraisal cap.

This article was updated at 4 p.m. Thursday.

Kenric Ward writes for the Texas Bureau of Watchdog.org. Contact him at [email protected] and follow him on Twitter @Kenricward

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Kenric Ward was a former San Antonio-based reporter for Watchdog.org.