Comparing SB 1 and HB 90

Does SB 1 Provide Significant Tax Relief For Texans?

After Governor Abbott added property tax relief to the special agenda items list, property tax relief has once again taken center stage in the current special session. The only bill that has made any movement is SB 1 by Senator Paul Bettencourt (R-Houston). This is an identical bill to SB 91 from the second called special which TFR has covered in past articles. With its early support in the Senate and House, it is looking more and more likely that SB 1 will be the bill that will be passed as property tax relief in this special session. Most Texans are asking, “How is this confusing bill going to provide property tax relief to Texans?” According to the authors intent in the SB 1 bill analysis:

“S.B. 1 will provide additional school maintenance and operation (M&O) tax rate compression for the 2022-2023 school year of at least $2 billion. Each billion dollars of compression lowers school M&O tax rates by 3.3 pennies. All property owners in Texas would see a reduction of their ISD tax rate by at least 6.6 pennies. The owner of a home with a taxable value of $300,000 would save $200 on their tax bill.”

Let’s unpack what all of this means.

The bill proposes that it will apply a minimum of $2 billion using the $7.85 in surplus funds gained from the new spending limit passed in the 87th regular session. There also is the possibility that additional money could be allocated if the surplus reaches $12.35 billion in the fiscal year 2023 when the comptroller gives an updated BRE. We can only assume this additional relief did not seem likely to the LBB since it was not calculated in the bill’s fiscal note. 

We can operate under the assumption that a one-time payment of $2 billion dollars would be the likely relief given to Texas homeowners based on the fiscal impact estimation in SB 1. As stated in the author’s intent above, “every $1 billion in compression lowers school tax rates by 3.3 pennies. What is a penny? In simple terms, a penny represents $1 for every $100 in a home’s value.

In the example given in the analysis, a $300k home would expect a 6.6 penny reduction (This can be found by dividing $300k by 100, then multiplying times .066). This gives us a $198 reduction in property taxes for that home. This calculation can be done on any home value to see the tax reduction based on SB1. So, a $200k home would see a $132 reduction, and a $400k home would see a $264 reduction. To determine how significant of a reduction in taxes this would be, we need to know the average rate paid by Texans on their homes.

What is the average property tax rate in Texas?

The average county tax rate in Texas is $1.81 according to On that same $300k home we would expect on average to pay $5430 in property taxes in 2020. Now, let’s apply the same $198 in relief from SB 1 and calculate the percentage of relief for the homeowner (calculated by 198/5430). This results in a 3.65% average reduction of property taxes for a $300k home.

But wait, it gets worse!

Based on Zillow home value estimates, Texas home values have gone up an average of 7.85% year over year since August 2016. This means that the net tax burden change after the appraisal increase for taxpayers on a $300k home would be an increase of 4.2% (subtracting 3.65% from appraisal increase of 7.85%-3.65%).

If SB1 passes, taxpayers can expect a 4.2% increase in property taxes next year! Not exactly the property tax relief you were hoping for?

This is because when politicians administer the minimum effective dose (a common tactic to get reelected), the results are always disappointing. This is why TFR has suggested that the entire surplus be used for the compression rate reduction. Based on the “$1 billion = 3.3 pennies” in the author’s intent of the SB1 bill analysis, this would mean if we used the entire $7.85 billion for a compression rate reduction, it would result in 25.90 pennies! Using the $300k home value as an example this would be a $777 reduction in taxes or 14.3%.

But it gets better!

This could repeat every biennium until the M&O rate is zero. Even adding in the year-over-year appraisal increase there is a net reduction of 6.4% in property taxes for your average Texan. This superior result is why TFR opposes SB1.  It is a bill that claims to provide property tax relief but ultimately would only limit the growth of our taxes due to out-of-control appraisal value increases. TFR continues to advocate for our plan that uses 100% of the $7.85 billion surplus to provide meaningful relief to taxpayers, ultimately ending in school property tax elimination!

The closest bill that accomplishes this is HB 90 by Rep. Tom Oliverson (R-Cypress) which would use 90% of the surplus to accomplish this (and is not a one-time payment). HB 90 would continue to reduce compression rates for every biennium that there is a surplus. We believe this would eventually end in the elimination of the M&O property tax. TFR will continue to keep taxpayers updated on where these bills are in the process this legislative session and continue to fight for the complete elimination of property taxes.

Will TXLEGE Decide To Patch The Leak, Instead of Eliminate It?

Recently the groundswell of conservative voices demanding property tax elimination has reached all-time highs. The last two special sessions have not delivered the results for property tax relief that taxpayers have demanded. Property taxes have risen more than 181% in the last 20 years for Texas homeowners, and it seems like they will continue to rise if nothing is done about it. Abbott added property taxes to his agenda items for the 2nd called special legislative session and seemed to hear the demand from Texans that something needs to be done.

TFR and other fiscal organizations have been advocating to use the $7.85 billion surplus as well as dedicating future surpluses to paying down M&O compression rates until they are eliminated. This was made possible by the recent passage of a spending limit bill passed during the 87th legislative session. There was a bill filed in the 2nd called special session by Tom Oliverson (R-Cypress) that would have done just this. HB 122 dedicated 90% of reoccurring surplus revenues to pay down M&O compression rates until they reached zero. This was a bill with a true path to elimination. However, the House decided to ignore that bill in favor of tax carve-outs (SB 12) and a minor homestead exemption extension (SB 8). After signing these two bills into law Governor Abbott declared that he had given property tax relief to Texans and celebrated.

The problem is that we didn’t get property tax relief. Texans are still demanding the elimination of property taxes, or at minimum, significant tax relief. Knowing this, it was a surprise to TFR when Abbott called the 3rd special session and left property tax relief off of his agenda items list. He instead put leashing restrictions for dog owners as an agenda item. With this move, the Governor made it clear that he prioritizes criminalizing dog owners above helping homeowners drowning in property tax burdens.

Speaker Phelan and Lt Gov Dan Patrick have acknowledged that property tax relief needs to be dealt with and both have added it to their priorities for the 3rd special session. Sadly, both have put their influence behind SB 1 with is identical to SB 91 from the second called special session. SB 91 was passed by the Senate during the 2nd called special session but never made it to the House. SB 1 provides temporary relief by using a one-time payment of $2 billion dollars to buy down M&O compression rates. According to the bill analysis, this would result in a 6.6 penny decrease in M&O compression rates for taxpayers. In plain English, this would mean roughly $200 off your tax bill if you own a $300k house according to Paul Bettencourt’s (R-Houston) statement of intent.

Not exactly the significant relief you were hoping for is it? It feels as though property tax relief is getting the usual “minimum effective dose” again in hopes it will appease voters enough to get politicians through a crowded primary season. It is up to taxpayers to demand that more is done. Patching the leak with a one-time payment and no plan for elimination in the future is not an acceptable solution to our property tax problem. Taxpayers deserve a bill that would put into statute a path toward property tax elimination, a plan that TFR has been advocating for months.

A bill like HB 122 would be a good start, Tom Oliverson has filed an identical bill in the 3rd called special session (HB 90). TFR again will be supporting this bill as the only one with a real path to elimination. Will Abbott add property tax relief to his agenda items?  Will HB 90 be ignored again in favor of weaker legislation? There is not much time to get this done, taxpayers who are concerned about rising property taxes should call and let their legislators know they demand a permanent solution, not a quick patch.

Taxpayers Ask For Steak, But Receive Spaghetti Instead.

Recently Governor Abbott tweeted that among other conservative legislation, the Texas legislature just passed property tax relief.

This should be cause for celebration! We finally got what we have spent years begging our elected officials for! We are finally going to see significant property tax relief! Right?


If you were at a restaurant and you ordered a steak, but the server brought you spaghetti instead… would you be upset? Would you say something to them or just be happy that they brought you anything at all?

TFR has been focusing on true property tax relief through elimination for months now. We have championed HB 122 by Rep. Tom Oliverson (R-Cypress) throughout the last month. HB 122 was the only bill that came close to providing what Texans asked for. It would have used 90% of ongoing budget surpluses to pay down the school property tax rate until it was eliminated. However, the Texas legislature had other ideas…

We believe Texans ordered a steak, but what did the legislature actually bring us?

Here are the two bills we were served after ordering a path to school property tax elimination:

SB 8

SB 12

Both SB 12 and SB 8 were filed by Senator Paul Bettencourt (R-Houston) and have been sent to the governor’s desk.

The problem with both of these pieces of legislation is that they provide minimal tax relief and more significantly, they are not what taxpayers asked for. For years Texans have asked for the elimination of the property tax. Yet Texans have received spaghetti last few sessions. This special session marked the first time that a bill with the goal of eliminating the school property tax had serious traction.

Yet instead of giving taxpayers that glorious ribeye we asked for, we got a steaming pile of spaghetti, and we are told we should like it. With rogue appraisal districts inflating home values it is unlikely most homeowners will see any significant reduction in their property tax bills next year based on the “property tax relief” that was given to us.

Taxpayers are going to have to decide if they are going to sit quietly and be thankful for the spaghetti the legislature gave us, or if we are going to demand the steak that we ordered… a real path to property tax elimination.

Comparing Property Tax Legislation