News88th TXLege

Gov. Abbott Flip-flops on Property Tax Elimination in State of the State

February 16, 2023
|
Jeramy Kitchen
|
88th Legislative Session, Budget Surplus, Greg Abbott, Property Tax, School Choice

Texas Governor Greg Abbott on Thursday evening laid out his vision for the ongoing 88th Legislative Session and beyond, signaling to Texas state lawmakers what he wants them to prioritize.

The speech is normally given in front of both chambers of the Legislature, but for the second legislative session in a row, Abbott opted to buck tradition and instead televise the speech offsite.

Much of what was discussed had been hinted at over the last year or so. In total, the governor enumerated seven emergency agenda items. As is the question every legislative session: Will the Legislature act quickly on Abbott’s agenda?

List of 7 ‘Emergency’ Items

Agenda Item
Cutting Property Taxes
Ending COVID Restrictions Forever
Education Freedom
School Safety
Ending Revolving Door Bail
Doing More to Secure Our Border
Addressing the Fentanyl Crisis

The Growing Property Tax Burden

Last summer, Abbott announced his support for providing taxpayers with the “biggest property tax cut in the history of Texas.” If you do the math, accounting for inflation, about $20 billion would need to be allocated for such a thing to qualify.

A few weeks after the announcement, at the sole gubernatorial debate ahead of the 2022 general election, Abbott said this in response to a question about property taxes:

“My goal is to eliminate the school property tax that is imposed in the state of Texas so that people can genuinely own their own home without being taxed out of it.”

Shortly after Texas Comptroller Glenn Hegar provided his updated Biennial Revenue Estimate (BRE), which included a larger surplus figure of more than $32 billion, Abbott doubled down on his support for using at least half to provide taxpayers with tangible property tax relief.

In the midst of his State of the State address, he said this about property taxes:

“As I travel across Texas, there’s one thing I hear loud and clear: Property taxes are suffocating Texans. We must fix that this session.

“Hardworking Texans produced the largest budget surplus in Texas history. That money belongs to the taxpayers. We should return it to you with the largest property tax cut in the history of Texas.

“Working with Sen. Huffman and Rep. Bonnen, we have all proposed using $15 billion to cut property taxes. Now we must ensure that it provides lasting property tax relief. To get that done, cutting property taxes will be an emergency item this session.”

He stopped short of calling for the elimination of the school M&O portion of the property tax, as he did last fall. Instead, he invoked the $15 billion of alleged property tax relief included in the base budget proposals in the state Legislature.

When you dig into the numbers, however, the $15 billion number is extremely misleading. The reality is that only about $9.7 billion is being proposed for property tax relief, including $3 billion for the aforementioned proposed homestead exemption increase. The remaining $5.3 billion is to maintain existing compression from previous property tax relief efforts. This number is a far cry from the “biggest property tax cut in Texas history” as announced by Abbott before the legislative session even got underway.

How Will the Legislature Act on Property Taxes?

This is perhaps the largest question looming over the entire legislative session. Will the Legislature respond accordingly?

Thus far, Lt. Gov. Dan Patrick’s position on property tax relief is, at best, confusing. He has largely supported increasing the homestead exemption from that of its current threshold of $40,000 to $70,000, as he recently laid out in his own list of legislative priorities. He has stopped short of specifically calling for a path to the elimination of the tax, though he maintains he is on “the same page” as Abbott on the issue.

House Speaker Dade Phelan (R-Beaumont) has not explicitly published a list of his priorities. Still, in both his re-election victory speech as speaker of the Texas House and in recent interviews, he has expressed his support for appraisal reform as a means to provide property tax relief, with no mention of using the budget surplus for such purposes. He had previously hinted that his plans for the surplus did not include property tax relief.

Parental Empowerment and School Choice

Up until this point, details surrounding Abbott’s support for school choice-related legislation have been fleeting. In his address, he said this about school choice efforts this session:

“Let’s be clear: Schools are for education, not indoctrination. Schools should not push woke agendas. Period.

“We must reform curriculum, get kids back to the basics of learning, and we must empower parents. Parents deserve access to curriculum, school libraries, and what their children are taught. We will do that with our Parental Bill of Rights.

“Parents also deserve education freedom. Without it, some parents are hindered in helping their child succeed. That must change this year.

“The way to do that is with school choice through state-funded Education Savings Accounts. We’ve seen them work in other states—and here in Texas. I created Education Savings Accounts for special needs students. It worked so well that a bipartisan super-majority passed it into law and now wants to increase funding for it. Now, it’s time to provide every parent with the ability to choose the best education option for their child.

“To be clear, under this school choice program, all public schools will be fully funded for every student. This is so vital to the future of our state that I am making education freedom an emergency item this session.”

Recent polling has indicated growing support for the idea of school choice among Texans.

How Will the Legislature Act on School Choice?

It is nothing new to hear of Abbott’s support for school choice. Similarly, Patrick has been supportive in the past, with the most recent effort in 2017 when ESA legislation passed the Senate but was stifled in the Texas House of Representatives. Patrick also announced it as a priority of his this session.

In this session, Phelan has been virtually silent on the subject.

In the last legislative session (2021), the sole vote to take place on the issue of school choice actually took place in the House as they deliberated the state budget for the current biennium.

An amendment authored by Democrat State Rep. Abel Herrero (Robstown) sought to ensure that no taxpayer dollars would “be used to pay for or support a school voucher, education savings account, or tax credit scholarship program or a similar program through which a child may use state money for nonpublic primary or secondary education.” That amendment was adopted by a vote of 115 in favor and 29 in opposition. Fifty Republican House lawmakers voted against school choice.

Have those same Republican House lawmakers suddenly changed their tune this session?

What Is Next?

The 88th Legislative Session is underway. Concerned taxpayers can contact their lawmakers.

Lawmakers have until Friday, March 10, to file legislation for potential consideration during the session. The session ends on Monday, May 29.


Texans for Fiscal Responsibility relies on the support of private donors across the Lone Star State in order to promote fiscal responsibility and pro-taxpayer government in Texas. Please consider supporting our efforts! Thank you!

Get The Fiscal Note! Our free weekly roll-up on all the current events that could impact your wallet. Subscribe today!