Texas lawmakers condemn school districts with rising property tax rates

Amy French

Palestine Herald-Press
Ali Linan CNHI Texas statehouse reporter
Sept 16, 2022

AUSTIN — Texas lawmakers have condemned half a dozen school districts that plan to hold property tax rate elections in November as a means to curb budget shortages.

State Sen. Paul Bettencourt, R-Houston, said he was particularly upset that several school boards voted to take this route, one that he said will not lower any property taxes.

“We want tax rates to come down. We want people not to be taxed out of their home, or taxed out of their business,” Bettencourt said. “I find these to be especially an affront to taxpayers given the circumstances of how much these appraised values have increased.”

In 2019, lawmakers passed House Bill 3, a sweeping school finance bill that also addressed rising property tax bills by placing tax rate adoption requirements on taxing entities.

School districts — which make up the largest share of where one’s property taxes go — are now required to compress their tax rates once they hit a certain level of property value growth. To fill the gaps, the state dedicated more state funding.

Should a school district deem it needs more funding to operate, it must place a new tax rate — often the same rate as the year prior, negating any relief — on the ballot.

Bettencourt chastised school districts for taking the election route. He said he believed the rise in property values was sufficient to ensure districts would collect enough money without additional tax increases.

The school districts disagreed.

Fort Bend ISD is looking to bridge a $47 million budget deficit for the 2022-23 fiscal year, while also securing funding for additional staff compensation, teacher pay increases and new safety measures. By keeping the same tax rate, and taking into account rising property values, taxpayers in the district will pay an average of $208 more in school taxes, school officials said.

Katy ISD is looking to address an $11.92 million shortfall. It too is asking voters to approve the same tax rate it had last year. This would be an additional $150 in annual school taxes, district officials said.

State Sen. Sarah Eckhardt, D-Austin, said the districts are using a mechanism the law allows for — taxing entities can raise the tax rate if voters approve it.

Eckhardt added that the state should perhaps look into its low contribution toward public education that is leading school districts to take such action if it wanted to guarantee lower property taxes.

“I grow concerned when we simply condemn our partners at the local level without understanding what their challenges are,” Eckhardt said. “Let's find out what the challenges are that are moving that unintended consequence.”

Bettencourt said if voters approve the new rate, they will not see any property tax relief. He said he believes taxpayers are being misdirected to think that an approval will still result in some tax relief.

“I think the resulting output from taxpayers is going to be enormous, but unfortunately, that’s the way the system works,” Bettencourt said. “I’m doing my best to be as clear as I can because it's important for folks to know that that's not what the Legislature intended. That is not what HB 3 was passed by a unanimous vote to do.”