AUSTIN, Texas (Nexstar) — Texans voted for property tax relief, passing two different constitutional amendments in the May election. Proposition 1 and 2 will pass with a wide majority of the vote.
Proposition 1 on Texas’ May election ballot sets out to give disabled and senior individuals a tax break by paying less to public schools.
It would lower their school property tax bills year after year.
Both of the constitutional amendments garnered unanimous bipartisan support from Texas lawmakers, who say the propositions will help relieve the high property taxes Texans are experiencing as the housing market continues to boom.
Proposition 1 would freeze the frozen school property tax bills for the elderly and Texans with disabilities starting in 2023. It would also lower their school property tax bills year after year.
In the 2019 session, lawmakers passed school funding legislation that could conceivably push the tax rate below the level it was when a homeowner had their taxes frozen. Prop. 1 aims to change the state’s constitution to allow the rates to drop for those homeowners, if those rates drop below the levels where they were frozen. The proposition does not allow for rates to increase beyond where they’re already frozen.
The ballot language in this proposition has caused some concern, as it is not easily understood in the way it is written on the ballot.
Here’s how it reads:
“Proposing a constitutional amendment authorizing the legislature to provide for the reduction of the amount of a limitation on the total amount of ad valorem taxes that may be imposed for general elementary and secondary public school purposes on the residence homestead of a person who is elderly or disabled to reflect any statutory reduction from the preceding tax year in the maximum compressed rate of the maintenance and operations taxes imposed for those purposes on the homestead.”
Dale Cramer, president of the Texas Taxpayers and Research Association, said Texans should think of Prop. 1 as a way of extending additional tax relief to senior citizens and those with disabilities.
Property taxes for school purposes in Texas are frozen at their current rate once someone turns 65. However, last legislative session, lawmakers passed a bill that forces school tax rates down.
“If your school taxes were capped say, 10 years ago, when your value was much less, you’re not getting any benefit from those rates declining because your values are far beyond where they were when the cap was set,” Craymer said. “What Proposition 1 does is…whatever your capped amount, no matter when that occurred, as school tax rates come down, it will bring down your cap amount as well.”
Proposition 2 would increase the homestead exemption Texans can take on their school district property taxes from $25,000 to $40,000. That would begin Jan. 1, 2022.
Sen. Paul Bettencourt, R-Houston, authored both of the proposed constitutional amendments and said Proposition 2 will provide long-term relief to property owners in Texas.
“The homes that qualify get an extra $15,000 exemption, which translates to about $175 per year savings for the lifetime that they — that anybody has a home. And that’s thousands of dollars of savings over the life of a homeowner in Texas,” he said.
Actual savings would depend on local tax rates.
Craymer said if these constitutional amendments are approved by voters, it will not significantly impact the budgets of Texas’ public schools.
“Under the school finance formulas, school districts are guaranteed a fixed dollar amount per student. The only thing that changes is how much of that is paid with property tax and how much of that is paid with state aid,” he said.