State. Rep. John Bryant, D-Dallas, led a small coalition of progressives on Thursday in supporting a new package of property tax relief measures that tops out larger than any other proposal yet.
His bill proposes $20.9 billion to provide homestead exemptions of up to $200,000, cash rebates to renters, permanent pay raises to teachers, and some cuts to school district tax rates.
“Texans pay the fifth highest property taxes in the nation, yet our state is 44th in its support for public education. Neither ranking is acceptable,” Bryant said. “We believe a property tax relief plan should simultaneously address both.”
Permanent public education funding increase
House Bill 62 increases the basic allotment for public schools by $1,000 and indexes it to inflation, creating a permanent increase every year. That would amount to a pay raise of $4,300 per year for teachers.
“We find ourselves in a fortunate position with the record surplus, and it is our duty to use this opportunity to provide relief to Texans burdened by property taxes,” Rep. Christina Morales, D-Houston, said. “But let me be clear, our focus is on the people and families, not the corporations. We believe that giving money directly to those who need it the most.”
The Democratic plan proposes the state use $3.8 billion to send renters a cash rebate of up to 10% of rent paid in the previous tax year. Lawmakers argued the Republican plans do nothing to help the 38% of Texas households who rent.
“We cannot ignore the fact that renters have been left out of this conversation since the very beginning,” Morales said. “That is why we have been tirelessly fighting to include them. Renters deserve to receive their fair share of tax relief, especially as rents have skyrocketed in the past few years.”
Higher homestead exemptions
The plan would grant homeowners an exemption of either $100,000 or 25% of their home’s appraises value — whichever is higher, and capped at $200,000.
The Texas Senate is standing behind a proposal to increase the exemption to a standard $100,000 for all homesteads. Homeowners can currently exempt just $40,000 of their home’s value from property taxes.
“This prevents the $100,000 exemption from evaporating rapidly due to the increase in home values,” Bryant said.
The plan would spend $4.11 billion to buy down the taxes that school districts charge for maintenance and operations expenses.
But Democrats argue that is unrealistic and unhelpful to renters and teachers.
“The comptroller has projected that that was going to cost about $60 billion over the next two years, once the property relief plans are put in place. $60 billion. Where are we going to get $60 billion?” State Rep. Donna Howard, D-Austin, said. “This is unrealistic, it’s unsustainable, and [it] holds our schools hostage to what the state decides to do instead of their local communities.”
It is not clear how this plan will fit into the longstanding proposals that have been on the table between the House and Senate. Rep. Bryant said they have not yet discussed their proposals with House leadership like Speaker Dade Phelan.
“We intend to do that immediately,” he said.