Texas top Republican lawmakers are sparing over cutting property taxes.

Gov. Greg Abbott, Lt. Gov. Patrick and House Speaker Dade Phelan all agree the reductions are needed, especially given Texas’ nearly $33 billion budget surplus, but Patrick and Phelan for months have had different ideas on the best way to deliver.

The House and Senate didn’t come to an agreement by the end of the day Monday when both chambers adjourned their regular sessions, but the lawmakers were warned to stay close: A special session was coming.

Just hours later, Abbott called what is expected to be the first of several special sessions during which lawmakers take up policy areas of the governor’s choosing. It began immediately, and by the end of Tuesday, both chambers had acted fast and passed their tax cut proposals.

The House went a step further when it adjourned without taking up the Senate’s proposal and with their bill now in the upper chamber.

So what’s proposed?

What is Gov. Abbott asking for?

Over the past several months, Patrick has called for increasing the homestead exemption, while Phelan has favored lowering the state’s appraisal cap for all properties. Abbott has called for property tax cut, but for the most part, hadn’t weighed in publicly on which plan he preferred.

But Abbott’s preference for the delivery of property tax cuts came into focus on Monday night when he called lawmakers back to Austin to make tax cuts and told them specifically how he wants the savings done.

Lawmakers should pass “legislation to cut property-tax rates solely by reducing the school district maximum compressed tax,” he said in his special session proclamation. That means directing state dollars to school districts to lower their property tax rates, which are set locally.

What are the House and Senate proposing?

The House’s property tax plan passed Tuesday would reduce school property tax rates by an additional 16 cents, a savings of $485 for the owner of a $350,000 home in the Fort Worth school district. The measure is subject to voter approval as a constitutional amendment.

“His special session call gave us clear-cut direction to buy down property taxes using tax compression, and the passage of today’s legislation fulfills that call,” Phelan said in a statement.

The Senate proposes a combination of lowering school property tax rates and increasing the state’s homestead exemption, which is $40,000. Those who are 65 or older or disabled can qualify for an additional $10,000.

Were the Senate’s bill made law, tax rates would be cut by 10 an additional cents and the homestead exemption raised to $100,000. That plan would save the owner of a $350,000 home in the Fort Worth school district $1,019. The plan must also be approved by voters as a constitutional amendment.

“I have been committed to fighting back against the wave of ever-increasing property taxes since before I held elected office,” Patrick said in a statement. “The combination of a substantial homestead exemption and property tax compression is a very powerful way to deliver serious property tax relief.”

School tax rates are already expected to be cut by about 11 cents as a result of 2019 legislation, Sen. Paul Bettencourt, a Houston Republican who authored the senate’s tax, plan said on the floor Tuesday. That savings of 11 cents translates to $342 for the owner of that $350,000 in the Fort Worth school district.

What has Abbott said?

Abbott on Tuesday expressed support for the House’s plan and shared a letter from homeowner, business and consumer groups that approve.

“The Texas House is the only chamber that passed a property tax cut bill that is germane to the special session that I called to provide Texans with property tax relief,” Abbott said in a Tuesday statement, later adding, “I look forward to signing it when it reaches my desk.”

But Patrick has stayed firm that the Senate’s proposal is the best route and more beneficial to homeowners. In a statement shared on Twitter, he said “while the Governor has the sole authority to call the Legislature into Session, the Legislature writes the bills.”

“I stand by our bill. It is germane to the call — legal precedent is clear on this point,” Patrick said. “Something Governor Abbott and Speaker Phelan should remember — for any bill to pass, it must go through both the House AND the Senate.”

What’s next?

With the House adjourned, the the Senate’s proposal is dead. Bills must pass both chambers, and in the House there aren’t any lawmakers to pass it.

The House has sent its property tax measures to the Senate, but the Senate cannot make changes to the legislation without it going back to an empty House chamber for approval. Any changes, the bill is dead.

That leaves the Senate with two options: Pass the house’s property tax plan or don’t and risk being called back for another special session on tax cuts.

The chamber next meets at 10 a.m. Friday.

“If the House thinks after abandoning the Capitol, and walking out on the Special Session, the Senate is going to pass their ‘take it or leave it’ property tax bill without a homestead exemption, they are mistaken,” Patrick said in a Wednesday afternoon Twitter post.

This story was originally published May 31, 2023, 3:54 PM.