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Voters Deciding On Property Tax Cut. What's The Trade-Off?

Early voting has already started in the November 3 election that could reduce school property tax bills for Texas homeowners.  But there's a trade-off.

At the legislature this year Lt. Gov. Dan Patrick and many Republicans promised and adopted tax cuts.

One result was Proposition 1 on the November 3 ballot.

It’s a constitutional amendment that would raise the homestead exemption for school property taxes from $15,000 to $25,000.  Lawmakers say that would reduce the average residential school tax bill by $125. 

It sounds like a deal almost no one would object to.  But there is a flip side.

If Proposition 1 passes school districts across the state would lose $1.2 billion in property tax revenue over the next two years. To keep schools funded at the same level, the legislature would replace the loss with money that could be used for other state services.

Eva DeLuna Castro works with the Center for Public Policy Priorities. Her organization has argued that full funding of schools should have come first.


“What we were arguing is that the $1.2 billion it’s going to cost the state to replace local property taxes could have been given to schools in addition to what they were already going to spend not instead of (what they were going to spend),” Castro said.

On top of the gap Proposition 1 would create, the state budget will lose $2.6 billion more because of a cut in the business franchise tax, and another $5 billion if voters approve Proposition 7 which commits state money for transportation. 

Castro says the cuts would add up as revenue from oil and gas decline.

“So this next legislature that returns to write the 2018-2019 budget is going to have at least $10 billion less to write the budget than would have been the case otherwise.  And that doesn’t really spell good news for a state that’s growing as fast as Texas,” said Castro.


In the meantime, many homeowners looking for relief with Proposition 1, would still see an increase in their tax bill.

Mary Kieke, Deputy Chief Appraiser for the Bexar Appraisal District, says in Northside ISD, for example, the average school tax bill will still rise $104 because the value of residential properties has skyrocketed. However, without the additional exemption under Prop 1, Northside school taxes will increase even more- about $242.

In San Antonio ISD the average school tax bill will go up $111 if Proposition 1 fails, but it will decrease by an average $27 if the ballot measure passes.

Shelley Kofler is Texas Public Radio’s news director. She joined the San Antonio station in December 2014 and leads a growing staff that produces two weekly programs; a daily talk show, news features, reports and online content. Prior to TPR, Shelley served as the managing editor and news director at KERA in Dallas-Fort Worth, and the Austin bureau chief and legislative reporter for North Texas ABC affiliate WFAA-TV.