Hundreds sign up to have voices heard on property tax bill
Texas homeowners and local government leaders had their first opportunity Wednesday to testify on a property tax bill that would trigger an election if taxing entities raise taxes more than 2.5 percent. Hundreds of people signed up to testify.
Senate Bill 2 would also provide additional transparency for property owners to understand why and how their property taxes increased.
Many city and county leaders believe the property tax cap would be harmful and potentially impact city services, including public safety.
Mayor Steve Adler said he is happy state lawmakers are committed to finding a property tax solutions for homeowners and hopes he can be constructive in the process.
That said, he said there is a long way to go before he could support the bill. "In its current form, it would be pretty disastrous for cities," said Adler.
Adler said in three years, a 2.5 percent revenue cap would create a structural deficit of $50 million. "There is no way we could absorb that kind of financial hit without having to cut our public safety programs," he said.
Austin Police Association President Ken Casaday said the bill could also impact potential pay raises for police officers, based on language in the current police contract with the city. "This could affect public safety, it could affect the way we fix pot holes, it could affect the way we fund pensions, which would leave taxpayers in a bigger hole further down the line," said Casaday.
It isn't just city leaders sounding the alarm. Williamson County Judge Bill Gravell said the bill "handcuffs" local governments. Gravell said the county would have to find a way to cut approximately $100,000 a week. That could mean cutting everything from indigent attorney fees to sexual assault exams.
If the state funded currently unfunded mandates, Judge Gravell said he would consider supporting a 'tax cap' bill. "I've heard it said often, 'you just have to cut the fluff'. And I'd say, come from the capitol to our county government and look at what we do," said Judge Gravell, who said there is no 'fluff' to cut.
Former Austin city council member Ellen Troxclair testified Wednesday as a senior fellow for the Texas Public Policy Foundation. She said there is plenty of fat to cut in local budgets. "When you hear the panic about the sky falling, please keep in mind that this is a tiny percentage we are talking about here," said Troxclair.
Troxclair said the amount of money the City of Austin would lose due to the cap is less than 1 percent of the city budget.
Troxclair believes cities and counties could make the cap work without cutting crucial city services. "When we are all talking about our personal budgets, we would decide to cut back on our Starbucks habit, well before we would decide not to pay our mortgage," she said.
Troxclair did ask senators to consider adding language to the bill to protect the salaries of first responders.
Critics of the bill also believe lawmakers should first focus on school finance reform. In Austin, more than 70 percent of homeowners' property tax bills stem from school taxes.
The bill's author, Senator Paul Bettencourt, said the state plans to pump billions into public education to help take away some of the tax burden for school districts. Still, many worry the money wouldn't be enough and would not be a sustainable source of revenue in the long-term.
Senate Bill 2 will likely have an easy path out of committee onto the senate floor. Most of the Property Tax Committee members are co-authors of the bill.