(10) comments Back to story

John Merritt

A few years ago, the Texas Legislature passed "tax reform" which limited the amount of increases in tax rates, knowing full well that the real increases in taxes are caused by the raising of property values. There must have been a lot of elected officials getting tired of winking at each other. California, however, has proposition 13, which allows a property to be taxed at its purchase price in perpetuity. This allows the very rich to leave their property to their kids, and now houses that were purchased in the 70's for $60k are now worth a million or so, but still taxed at the purchase value. That doesn't work either. There should be a limit of about 7% as the max increase of evaluation increases. I own two small rent houses in Galveston and the CAD has come at me with more that 30% value increases three times since IKE. Come on guys, this just isn't fair.

Rodney Dunklee

Republican legislators keep a confusing Robin Hood law that lowers the state's share of public education costs when appraisals go up. Last sessions signature legislation capped the money local schools can keep so "excess" funds raised locally pay for the states pet projects. At re-election time they will brag about the capped local revenue savings you got but fail to mention locals are paying millions more for local schools with the state pocketing evaluation increases over 3%. Apparently the politics of bragging about pretend tax cap savings far outway freezing tax valuations in the worst unemployment since the great depression in state leadership minds.

Larry Taylor

Mr Dunklee has incorrectly stated the property tax benefits of HB 3, the major education bill of last session. HB 3 included an immediate appropriation of State dollars to increase the State's share of public education and lower local tax rates by a statewide average of 8 cents in the first year, plus an additional cut of 5 cents in the second year. That is a significant savings for local taxpayers, but that would quickly be erased by increases in appraisals, so we also added a provision limiting any future increases to local taxpayers to a maximum of 2.5%. This will ensure that the State maintains its share and helps to keep the local taxpayers burden down. This is significant property tax relief as, for most of us, the school taxes are our largest property tax bill.

As for "Robin Hood", which is related to property taxes, but not the 2.5% revenue cap, we increased funding to lower the amount of Robin Hood recapture statewide by 46%. This moves many of our districts out of Robin Hood and they will no longer send local taxes to the State under recapture.

Rodney Dunklee

Thanks for the correction and for reminding that the last legislature did better for schools and taxpayers than any in recent history. I did pay $223.55 less in school taxes because of your work. Is the middle of a pandemic when people were ordered not to work the right time to have all those gains wiped out and have me paying an extra $100 more in school taxes than ever before on my residence? Wouldn't freezing appraisal increases, just as earnings were frozen or cut for many in this emergency, make sense?

Diane Turski

Actually, California's Proposition 13 has worked very well for Californians since it was voted in by Californians in 1978. The taxable property value is based on the purchase price and the property value doesn't raise more than 3% annually for as long as you own your property. This makes sure that people are not taxed out of their homes. Your home is a valuable asset in California. When you sell your property, you will pay long term capital gains taxes on the appropriate amount of taxable profit at the time, and the buyer will be taxed at the new purchase price value of the home.

Jack Cross

Diane, California Prop 13 is a disaster. When taxes is based on purchase price you create unequal taxing. You have one house appraised at say a 1990 value and someone buys an identical house across the street he bought in 2020 at thousands of dollars higher.

Also as anyone can clearly see, freezing taxes at purchase price is a huge revenue loss and this has caused California to increase other taxes through the roof

John Merritt

Every time someone does something as perceptibly unpopular, this newspaper labels them as Republicans. Did you forget that Judge Henry is also a Republican?

Kelly Naschke

When I see “pooh-pooh” in a headline on the front page of a newspaper....I have to question everyone from the top, down. Pooh-Pooh??? Really? That’s the expanse of your vocabulary and the depth of your intellect? As it is, you guys are barely one notch above the National Inquirer....

Jack Cross

Texas has two property tax systems, #1 the schools and #2 all the rest, city, county, community college and mud districts. Starting with, #2 “all the rest” these taxing bodies set the tax rate. If appraisals increase and your taxes increase, blame local boards because they didn’t lower the tax rate. The state could not lower your taxes if they wanted to because they can’t set the tax rate, so Larry Taylor is correct.

That takes us to property tax system #2 that is 54 percent of your property tax. Here the state is very much in control of a complicated system. Start with schools having a fixed amount per student determined by a complicated system of formulas. Then the state has a fixed amount of $1.17 cap on Maintenance and Operations M&O that 401 school districts are at.

With appraisals increase plus all new construction, the pot of money in the school taxing district increases. You would think that school boards could use this increase in property values to lower the tax rate. The state prevents this because it is the state who benefits when appraisals increases and new construction is added to the tax rolls.

The state uses the property value increases to reduce the state share of school funding by shifting the amount the state pays to the local school district onto the backs of property owners. Each year, the percentage of money the state contributes to its funding share decreases. It would take $10 billion annually to even the spending level.

The state puts this money $3.5 Billion in 2018 into the state budget and uses it for programs other than education. The state depends heavily on local property taxes even as the state constitution prohibits a state property tax. Other main revenue sources for the state are Oil/Gas, sales taxes and Gasoline Taxes, all of these are down. Texas has a 2 year budget, the current budget runs through 2021 it was based on Comptrollers Glenn Hagar’s projections that we now know are way off due to corona. It is going to be a rough ride moving forward caused by the shutdown.

The public little understands a complicated Tax/appraisal system, this allows both local and state leaders to make misleading or false statements.

Ted Gillis

Jack you are so right. The public has trouble understanding the property tax/appraisal system. I do remember when I was on the Santa Fe City council (years back) we were able to lower our effective tax rate (or keep it the same) each year, while still increasing our tax revenue due to increased property values (appraisals) and some new construction. It was as good as you could do without voting for a tax increase. Nobody wanted to do that! Most cities don’t have that much influence on the appraisal process anyway. The Galveston CAD board is made up mostly of large school ISD appointees. The cities and other taxing jurisdictions just have to accept what’s provided to them.

I remember we once tried to vote in a member on to the board, and even with support from other cities and a couple of smaller ISD’s still didn’t have the votes to overcome the CCISD candidate. It’s just a complicated system and weighted to the school districts.

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