Texas State Representative Wants To Hear From You In Urgent Plea On Property Tax Reform Bill


A Texas State Representative has sent out an urgent plea asking for Texans to provide input ahead of the House taking up consideration on Senate Bill 2 this week. Republican Representative Terry Wilson sent out a long, but urgent plea asking for Texans to present their point of view on the matter. You can read Rep. Wilson’s letter below and comment to him directly. 

Letter:


Tomorrow, The Texas House of Representatives will take up and consider Senate Bill 2, or “SB 2” for short. We apologize for the short turn around, but the Speaker of the House announced today that SB 2 would be eligible for consideration tomorrow. We have received more than 2,000 communications from constituents about this bill, so I thought I would send out a summary of what the version we will be.

SB 2 is a tax reform bill in three parts, making it easier to challenge your tax appraisal, requiring an election if a local government’s revenue grows past a certain point, along with increasing transparency on the entire system.

It is NOT a “Tax Relief” bill, since it is not lowering your tax burden to less than what it is right now. It IS about reforming the system to slow down the rate at which your tax bill increases as your property increases in value, especially since your paycheck often doesn’t keep up with those changes.

Requiring Rollback Elections:

Currently if a local taxing entity brings in more than 8% more revenue than it did the previous year, then the voters could sign a petition for a rollback election to lower their tax rates. SB 2 proposes making those rollback elections automatic and changes the triggers from the current amount of 8% to:

1.8% for all junior college and hospital districts

2. 3.5% for all other non-school taxing districts.

3. 2.0% for school taxing districts.

This does not cap the revenue, but makes sure that a local taxing entity would have to ask the taxpayers for permission at the next November ballot in order to raise more revenue than their rollback rate would raise.

SB 2 also lays out the information that taxing entities have to post as a public notice and include in a public hearing before they can offer an election to raise the tax rate.

Some other changes:
1.Each taxing entity can raise $500,000 in new revenue above their rollback trigger rate that does not trigger an election. This is called the “de minimis” amount, and it would assist small districts when they deal with emergencies like buying a new ambulance or fixing broken water pipes.

2.Allows districts to “bank” up to 5 years of lower rates. So, if a taxing entity doesn’t raise their taxes they can “bank” the extra amount for a time in the future without triggering an election

3.If a taxing entity offers a homestead exemption that reduces the available tax revenue more than in the preceding year, they can raise the tax rate to cover the exemption. Since the rate for everyone would go up, but the taxable value of homes would go down, this would shift the tax burden away from residential homes and onto apartment complexes, small businesses, and corporations.

Appraisal Reform:

1. Creates an advisory panel in the Comptroller’s office and requires training for arbitrators who have agreed to serve

2.Requires Appraisal Review Boards to offer a survey to look at the number of protests districts receive.

3.Prohibits family members or relatives from serving on the Appraisal Review Boards together.

4.Outlines the methods around a protested hearing for an appraisal on an individual's homes to be more public, more standard, gives more time to the individual to work through a protest, and cannot charge the individual for extra copies of reports.

(a.)For example, there is a change that would prohibit a protest case hearing from being heard after 7pm on a weekday and on a Sunday.

Transparency: Most of these changes are involved in other pieces of the bill

1.Standardizes what is to be included in postings for public hearings and the ballot for the election around raising the tax rate.

2.Clarifies when and how an appraisal review board can hold a hearing for a protested appraisal. Sets up what must be included in the notice given to individuals before a protested hearing.

3.Changes the name for the tax rate from “effective” or “rollback” to “no-new-revenue" to clarify that the rate they have set generates no additional revenue than the previous year.

4.Creates a statewide database for all the tax rates for all the taxing entities to be collected by district and then posted online

5.Creates a survey for tracking the appraisal boards and the number of protests each one has received.

While these changes will slow down the rate your property tax bill increases, they don’t come without potential downsides. As with school bond elections, if the voters choose to vote down a revenue increase, they may find some services they are accustomed to receiving reduced as well. A rollback election can cost anywhere from $20,000-$40,000. Tie this with the legislature’s predilection towards creating unfunded mandates on local governments, and cities and counties could face some very tight budgets.

I want to hear from you directly. Would these changes make a difference to you? Is this what you are wanting for tax reform? What else would you like to see done? The link below will take you to a form where the HD20 staff and I will be taking down all comments on SB2 so we can have everything in one place.

Give You Thoughts Here

I would appreciate it if you would take a moment to click the link and add in your two cents on SB2.

Yours in Service,

Colonel Terry M. Wilson, US Army, Retired
Representative, Texas House District 20

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