Today, both the Texas House and Senate have released their budgets. Both the House and Senate appropriation bills provide $15B for property tax relief, with $12B to compress Maintenance & Operations rates by 7.75% and $3B to increase the homestead exemption from $40K to $70K. The general revenue-related fund (GRR) increase with property tax relief is 9.2%, which keeps the budget below the 12.3% spending cap.
TFR applauds the Legislature for their effort on property tax compression and wants to encourage them to dig deeper for Texas taxpayers. While this budget is a great start, it falls short of providing the largest property tax cut in Texas history. As Gov. Abbott and Lt. Gov. Patrick have both said, we have a “once in a lifetime, historic opportunity” to provide real property tax relief. Abbott has promised to deliver the largest property tax relief in Texas history. The current record stands at $14.2 billion in compression from the 2008-2009 biennium. To beat that, adjusting for inflation, the Legislature would need to provide around $20 billion in compression.
However, the best option would be what Abbott said was his goal in his debate against Beto: to eliminate school property taxes, so Texans can actually own their homes. We encourage the Legislature to continue down the path they have started and put Texas on a path toward the elimination of property taxes, and to come through on Abbott’s plan of the largest property tax cut in history by cutting more spending and providing at least $20 billion in M&O compression; preferably, however, the entire $32.6 surplus will be used. As both Abbott and Patrick have said, “This is not the government’s money. This is taxpayers’ money.” TFR would like to see all of it given back to Texans.
TFR’s Texas Prosperity Plan lays out our vision for a “no-growth budget” operating from the premise that government is already too big and Texas needs to stop the “slow the growth” method of budgeting in favor of cutting spending and stopping government growth in its tracks. The benefits of a no-growth budget would be historic, and the resulting surplus would likely be able to eliminate school property taxes in less than a decade. We call on the Legislature to seize this historic opportunity to cut government spending, freeze the growth of government, and deliver historic relief to all Texas taxpayers.