State bill allows for property tax cap increase during a disaster — some city leaders are looking into it

Hays

HAYS COUNTY, Texas (KXAN) — Some homeowners in Hays County may end up paying more in taxes next fiscal year.

Both the cities of Kyle and San Marcos are considering calculating property tax rates using an 8% percent cap instead of a 3.5% cap.

“That is not about the tax rate increasing 3.5%, it’s about the revenue the community gets from your property taxes. So, if your property value goes up, the county or the city could keep its tax rate the exact same, but you still did end up above that rollback,” explains State Representative Erin Zwiener, a democrat who represents Hays and Blanco counties.

The bottom line for homeowners: “Homeowners would still see some sort of tax increase?” asked KXAN’s Tahera Rahman.

“Yes,” replies Zwiener.

Under Senate Bill 2, which went into effect in January, the city would be required to put the issue to a public vote — but not during a disaster declaration by the governor or president.

Kyle’s preliminary estimates show the city faces a more than $5 million budget gap, according to the finance director.

The cap increase would mean much-needed funding.

“The cap can be deferred by a year or two,” Kyle’s finance director Perwez Moheet, told council members during a June 13 budget meeting.

“My recommendation would be that we should take advantage of this to delay it, to buy some time because $735,000, given all the needs we’ve seen so far, does make a big impact,” he said.

Zwiener says more aid needs to come from the federal level so that cities don’t have to consider an increase, at all.

She says there’s still time for neighbors to not only voice their opinions at the local level, but with federal elected officials before city budgets are set.

“I don’t want our cities and our counties and our emergency service districts to have to choose between fire trucks and raising your taxes,” she says.

Zwiener says one key piece of legislation could bring millions to the state of Texas.

“The US Congress already passed the Heroes Act, and it’s sitting over on the Senate side. The Heroes Act contains an extra $50 billion for State of Texas government entities and $36 billion of that are supposed to be for our local governments,” she says.

City staff has recommended that city council members approve the resolution.

Kyle City Council members were set to vote on their resolution during Tuesday night’s city council meeting but the mayor tells KXAN it will be pulled for further discussion at their next budget workshop in August.

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