86th LegislatureIssuesStatewide NewsTaxes & SpendingTexas Cities and Counties Scramble to Increase Property Taxes Before New Law Takes Effect

The new property tax law, which kicks in next year, limits increases at 3.5 percent for local governments and 2.5 percent for school districts with anything above requiring voter approval.
October 15, 2019
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Since the so-called “Super Bowl” property tax legislation of the 86th Legislature was signed into law, many taxing entities have been trying to squeeze all they can out of taxpayers before the new limits go into effect next year.

Currently, these entities can increase property taxes by as much as eight percent before triggering a ratification election with voters. Once the new law takes effect, that will be lowered to 3.5 percent for cities and counties and to 2.5 percent for school districts.

Some counties, such as Lubbock and Harris, have been forced to adopt the effective tax rate (no-new-revenue rate) through a loophole in the state’s local government code requiring a quorum at a regularly scheduled meeting. 

Conservative legislators on the Lubbock and Harris County commissioners courts simply decided not to show up for a meeting to prevent a tax increase from hitting their constituents.

Other entities, however, have raised property taxes right up to the current threshold. 

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Dallas County raised property taxes 7.5 percent. The Tarrant County Commissioners Court proposed a rate increase between nine and 10 percent to the tune of $43.5 million in additional revenue.

Travis County will adopt an eight percent increase. And Bexar County will increase property taxes by around six percent from the previous year.

On the city side, Austin will raise property taxes by eight percent.

Meanwhile, Fort Worth elected to raise their tax rate 2.39 percent — above the effective rate, but below the 3.5 percent limit that SB2 implements. Next door, the City of Dallas reduced its property tax rate by one-hundredth of a cent. 

However, the amount of property taxes collected will still increase because of rising appraisals.

Similarly, the City of San Antonio adopted a 2.43 percent increase from the previous fiscal year.

Houston elected to decrease its rate by two-cents which will yield a slight 1.8 percent increase total in property tax revenue collected after the aggregate appraisal increase.

As for El Paso, the city will bring in 7.1 percent — or roughly $21 million — more in property taxes this fiscal year compared to last.

The City of Denton will bring in 6.31 percent more revenue from property taxes than the year before — a three-cent decrease from the previous year’s rate.

Fredericksburg’s proposed 2020 budget would raise over 12 percent more property tax revenue, amounting to about $585,000 in additional funds.

And Lufkin has proposed a budget that would bring in five percent more revenue from property taxes.

The legislature made a point of addressing “bread and butter” issues and property taxes were chief among them. But numerous figures — including both Sen. Pete Flores (R-Pleasanton) and Rep. Jeff Leach (R-Plano) — say there is still room to improve when the next legislative session convenes in 2021.

Clearly, some officials at the local and county level see their efforts as the last opportunity to snatch additional tax dollars before the new law’s caps kick in, bringing a greater level of voter scrutiny and approval required for future taxing plans. 

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Brad Johnson

Brad Johnson

Brad Johnson is an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad watching and quoting Monty Python productions.