Travis County tax rate vote comes as new online tool aims to increase tax transparency

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AUSTIN (KXAN) — Travis County commissioners vote Tuesday on the budget for the upcoming fiscal year, and it includes a tax rate increase as high as legally allowed without triggering a public vote on the rate.

The proposed new rate, 36.9293 cents for every $100 in taxable value, is an increase of about 1.5 cents from the current rate. The county says it’ll cost the average homeowner an additional $126 next year.

That’s based on both the tax increase and a bump in average home value. Last year, the county says the average home had a taxable value of $326,894; this year, it’s up to $347,655, an increase of 6.35%.

A screenshot from the Travis County Commissioners Court agenda for Tuesday, Sept. 24, 2019, shows the difference between the current tax rate and the rate proposed for next year.

House Bill 2 impact

The tax increase is necessary, said Travis County Commissioners Court spokesman Hector Nieto, to pad the budget now, before the state caps the amount that localities can raise rates starting next year.

“We understand that we need to take care of our expenses now, especially for larger items that we want to provide,” Nieto said.

House Bill 2, passed this legislative session and signed into law over the summer, calls for an automatic election if a city or county raises property taxes more than 3.5%, starting next year.

HB2 supporters say the measure will keep property tax growth under control, even as home values continue to climb.

“What this does is achieve something that has never been done before with regard to property tax reforms of the past,” Gov. Greg Abbott said at the bill signing.

The current limit is 8% before voter approval is needed, so taxing entities like Travis County are capitalizing now on the higher threshold to fund big-ticket items. Nieto said budget items like a new public defender’s office and increasing the minimum wage for county employees to $15 an hour will require big investment.

“These were items that we could have spread out through multiple years had we had the flexibility,” Nieto said. “But the legislature took away our local control, and now we’re forced to do it this year.”

Tax transparency in Travis County

But the county is just one of several taxing districts homeowners pay. The total increase for next year will be around $275 for taxpayers in Austin using the county’s average taxable value for 2020.

A new website, which debuted in the last few weeks, aims to bring transparency to tax rates in Travis County and how they affect a family’s total tax bill.

The site is another product of HB2. Simply enter an address into the search bar at this link, and the site shows you which taxing entities you pay and a host of information about each one.

A screenshot from the new Travis County tax transparency website shows several different rates and the next public hearing on proposed rates.

Taxing authorities report three key numbers: the no-new revenue rate, the proposed rate and the voter-approval rate.

The no-new revenue rate is the tax rate an entity would need to set to bring in the same amount of revenue as the previous year, factoring in property value increases. That means the no-new revenue rate is typically going to be lower than even the current tax rate.

A bit more straightforward is the proposed rate; this is the rate that a taxing entity wants to impose in the coming year. The website has a separate column for an approved rate if and when the proposed rate passes.

Critical to the changes in HB2, the voter-approval rate (formerly called the rollback rate) represents the highest possible rate an entity can impose without triggering an election.

The site tallies your total bill if all proposed rates pass, and gives information about the next chance to provide public feedback about proposals to the taxing entity.

Austin ISD approved its new tax rate Monday night; thanks to school finance reform also passed this session, the rate went down by 7 cents per $100 of value, but rising property values might still mean a small increase in the total school district tax bill.

The city of Austin will vote on its new, higher tax rate at a special meeting Wednesday. The city passed its budget already, so the vote is a formality to finalize the finances.

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