It's Tax Time

Not a lot functionally has happened this week in the session, but we are nearing the end of the warm up laps. We have roughly 1,900 bills filed between the two chambers and only 37 days left to file bills. Historically we see about 6,000 filed, so we have a long way to go to hit that mark.

The major discussion centered on the self-titled, " Texas Property Tax Reform and Relief Act of 2019." The bill was announced in a joint press conference with Sen. Paul Bettencourt; Lt. Gov. Dan Patrick; Gov. Greg Abbott; House Speaker Dennis Bonnen; and Rep. Dustin Burrows. The bill is 116 pages, identical in both House & Senate, and will go through the House Ways & Means Committee and the Senate Property Tax Committee. It is still early in the process, but here are a few key points of the bill as drafted:

• The bill establishes a statewide property tax administration advisory board that will report to the comptroller on improving the effectiveness and efficiency of the property tax system, best practices, and complaint resolution procedures.
• It also changes the term Effective Tax Rate to No-New-Revenue. This is the rate at which the taxing unit can tax to receive the same revenue it did the previous year.
• It modifies the Roll Back Tax Rate calculation, the rate at which a taxing unit can tax without triggering a local election. The Roll Back Tax Rate is currently set by No-New-Revenue Maintenance and Operation (M&O) Tax Rate X 1.08. This allows the M&O tax rate of a taxing unit to increase by 8% before triggering an election. The bill changes that multiplier to 1.025, only allowing the M&O rate to increase by 2.5%.
• The bill allows for an exemption to that election trigger if the taxing unit was impacted by a natural disaster until the total taxable value of property within its jurisdiction is equal to what is was prior to the disaster or the 5th year of the disaster has passed.
• All tax rate increase elections must be held on the uniform election date in November of that year.

Next week the Senate Property Tax committee will hear invited testimony on the property tax bill. We will also have Governors State of the State address where he is likely to outline his emergency & priority items for this session.

As always, feel free to comment & share with your friends! 26 days down and 114 left to go!