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San Antonio City Council Approves First Ever Homestead Exemption

Joey Palacios
Texas Public Radio
The San Antonio City Council receives a briefing from the city's chief financial officer Ben Gorzell

Homeowners in San Antonio have a new tax exemption available to them this fall. The San Antonio City Council approved its first homestead exemption in a special meeting called Monday night.

The council approved a 0.01% exemption for homesteads. It works out to a flat $5,000 exemption applied to all residential properties where a homestead exemption is applied.  For all homeowners, it would save about $28 per year while the city would lose about $5.8 million in property tax revenue.

The exception is the first of its kind for the city. Homeowners in San Antonio can already apply two exemptions, like the over-age-65 exemption and a disability exemption which lowers their property tax bill as well.

The homestead was passed unanimously by the council. San Antonio Mayor Ron Nirenberg said this is a first step to see the impact and what the city can do in future budgets.

“Our intent is to not only provide the best quality services in an equitable city budget but also to provide as much property tax relief as possible for our city,” he said.

Nirenberg said the city was also waiting on the results of a study on the Bexar County Appraisal District on other methods of property tax relief. The city commissioned the study in April.

The homestead decision was made during a special meeting due to a July 1 deadline imposed by the Texas Comptroller’s Office. Taxing authorities must let the comptroller know by that date if they plan to offer exemptions. As a result, homeowners will see the exemption applied to their tax bills when they are released in October of this year.

It comes during some financial obscurity for the city as it plans its 2020 budget. The city’s chief financial officer Ben Gorzell said the minimum exemption was chosen amid other factors that will affect the city’s revenue capabilities including recently passed state laws.

“We have a number of financial challenges. We have SB2 going into effect in 2021; we have the telecom cable right-of-way legislation that changed the amount of revenue that we’re going to get from those companies starting in September – that’s about a $7 million impact,” Gorzell said, adding that revenues from CPS Energy were down about $11 million.

The Texas Legislature approved SB2 this year which reduces the amount of new property tax revenue the city can collect before having to ask voters for approval. It also approved SB 1152 which restricts how much cities can change telecoms in municipal fees.

The average homeowner’s property tax bill for the city for is about $1,000. That’s for homes valued at about $178,000. The maximum a city can offer on a homestead exemption is 20%. If a 20% exemption were applied in San Antonio a homeowner would save about $200 per year instead of $28, but the city would see a loss of $23 million in property tax revenue, according to city data.

Council members view enacting the homestead exemption as a victory for providing property tax relief. District 10 Councilman Clayton Perry said passing an exemption was a goal of his since he started on the council two years ago.

“I know there’s a lot of hand wringing and worry that we’re going to wreck something or break something, I don’t think that will happen,” Perry said. “I think the resources are available for this and it’s something people have been asking for.”

The city makes up about 20% of a homeowners total tax bill. School districts make up the bulk – about half – and other taxing entities like the Alamo Colleges, Bexar County, San Antonio River Authority and others make up the remaining 30%. Some – but not all – also offer homestead exemptions. 

Joey Palacios can be reached at Joey@TPR.org and on Twitter at @Joeycules.

Joey Palacios can be reached atJoey@TPR.org and on Twitter at @Joeycules