Texas Gov. Greg Abbott is again calling lawmakers to Austin to cut property taxes amid a months-long feud over the best way to deliver relief.

Just hours after lawmakers wrapped up their work in May, the governor announced a special session with tax cuts on the agenda. The House passed its proposal within a day and went home. But the Senate, advocating for an increased homestead exemption, didn’t consider the House bill, instead passing its own property tax legislation.

The standoff continued for weeks, and on Tuesday the clock ran out on the first-called special session without the passage of a property-tax compromise.

“During the five-month regular session, the Texas House and Texas Senate both agreed on cutting school district property tax rates, while the House wanted to add appraisal caps and the Senate advocated for increased homestead exemptions,” Abbott said in a Tuesday statement. “The Special Session #1 agenda was limited to the only solution that both chambers agreed on — school property tax rate cuts. After yet another month without the House and Senate sending a bill to my desk to cut property taxes, I am once again putting the agreed upon school district property tax rate cuts on the special session agenda.”

Just hours after the Senate adjourned, Abbott asked lawmakers to consider “lasting property tax rate cuts” and the eventual elimination of school districts’ maintenance and operation property taxes. The tax funds schools’ maintenance and operation and is generally the largest portion of a district’s total property tax rate.

The property tax rate cuts should be done “solely by reducing the school district maximum compressed tax rate,” Abbott’s special session proclamation signed Tuesday reads. That means the state would fund school districts so they could lower their property tax rates.

The two chambers have been at odds over the best vehicle for the cuts, and Lt. Gov. Dan Patrick, president of the Texas Senate, has criticized Abbott as the governor has expressed support for the House’s plan. And the governor vetoed a number of bills — mostly Senate bills — saying they could be reconsidered after property tax cuts were delivered.

In a ploy to apparently get his way, Governor Abbott suggests he is threatening to destroy the work of the entire 88th Legislative Session – hundreds of thousands of hours by lawmakers doing the work the people sent us to do.

The Governor’s suggested threat today to veto a…

— Office of the Lieutenant Governor Dan Patrick (@LtGovTX) June 14, 2023

During the first special session, the House approved a bill that would have cut school property tax rates by an additional 16 cents, on top of cuts from a 2019 tax cut bill. During the regular session, House Speaker Dade Phelan also supported lowering the state’s home appraisal cap and extending the cap to all property types.

Texas House Republicans have been hard at work this session to deliver the largest property tax cut in Texas history, voting to pass it THREE times. Each time, the Texas Senate has failed to bring any of the House’s proposals up for consideration. #txlege pic.twitter.com/uUwxJjlS0Q

— Texas House Republican Caucus (@TXGOPCaucus) June 8, 2023

The Senate during the special session initially proposed cutting school tax rates by an additional 10 cents and increasing the homestead exemption to $100,000. Senators later passed a bill that also included an expansion of the state’s franchise tax exemption, among other measures.

The same day the Senate offered its latest bill, Phelan announced a committee tasked with looking at proposals for “sustainable property tax relief.”

“The burden of rising property taxes weighs heavily on our state’s property owners, and it is imperative that we look beyond the current special session to identify long-term, sustainable solutions to this evergreen problem,” Phelan said in a June 20 statement.

He added, “we understand the challenges posed by skyrocketing property taxes require a multi-faceted approach. This committee will engage in a thorough analysis of the factors influencing property taxes, and consider the effectiveness of various solutions, including tax rate compression, appraisal caps, homestead exemptions, or a combination thereof. By exploring these complex dynamics alongside three public members with personal experience on the issue, we will be better equipped to formulate enduring solutions, including the possible elimination of property taxes altogether.”

The House and Senate are expected to reconvene Wednesday at 11 a.m.

“Unless and until the House and Senate agree on a different proposal to provide property tax cuts, I will continue to call for lasting property tax cuts through rate reductions and working toward eliminating the school property tax in Texas,” Abbott said in the Tuesday statement. “Special sessions will continue to focus on only property tax cuts until property tax cut legislation reaches my desk.”

In a statement, Patrick pointed out that during the regular session both the House and Senate both passed property tax cut bills with an increased homestead exemption.

The House approved a version of the Senate’s proposal that included a $100,000 exemption, in addition to lowered tax rates and a lowered appraisal cap. The Senate sent the bill to a conference committee made up of members from both chambers to work out differences, but a compromise wasn’t reached before the regular session ended.

Patrick said the Senate will continue to support cutting the tax rate and will “insist” on a homestead exemption. The Senate plans to again pass its latest proposal, approved earlier this month, Patrick said. Patrick said eliminating the school property tax completely would mean dramatically raising sales taxes, which he said lacks support in the legislature and from the public.

“The only tax cut that is lasting is a homestead exemption, which is locked into the Texas Constitution,” Patrick said.

What’s on the agenda for special session 2?

• “Legislation to cut property-tax rates solely by reducing the school district maximum compressed tax rate in order to provide lasting property-tax relief for Texas taxpayers.”
• “Legislation to put Texas on a pathway to eliminating school district maintenance and operations property taxes.”

This story was originally published June 27, 2023, 4:39 PM.