Monday, March 6, 2017

85th #TXLEGE and Property Taxes: Some Notes....

"But the former governors who were before me laid burdens on the people, and took from them bread and wine, besides forty shekels of silver. Yes, even their servants bore rule over the people, but I did not do so, because of the fear of God."
Nehemiah 5:15

UPDATE (5:22 PM): Looks like we made a boo boo....

With the Senate set to hear the property tax relief bill tomorrow having announced a date to hear the property tax relief bill, now is as good a time as any to write down some thoughts we've been pondering for the past couple months:
  • Senator Bettencourt's bill, SB 2, is a good start.  But it's only a start.  Lowering the "rollback" rate (ie. the rate beyond which taxing entities must seek voter approval) will begin to reign in the out of control spending in which local governments across the state love to engage; furthermore, making appraisal boards an elected position brings meaningful accountability at the local level.

    But it doesn't go far enough.  Local governments can still spend more than they should, they just can't go as far as they can under current law.

    Unfortunately, it's probably about as far as you can realistically get and still find 19 votes in the Senate and 76 votes in the House.  That's obviously pathetic, but it's also reality.  That being said, it's important to pass something tangible this session and Bettencourt's bill qualifies.  Sometimes, when a patient is hemorrhaging, the first step has to be triage.
  • Speaking of rollback rates, HB 15, Dennis Bonnen's property tax companion bill that was filed Friday...doesn't look entirely terrible.  Obviously, it's Bonnen, so trust is minimal.  That being said, if SB 2 and HB 15 can pass their respective chambers close to their current forms, the conference committee will be a productive discussion.
  • There are several bills related to various aspects of the appraisal system; pretty much any would be welcome...but we only have the bandwidth to track so many bills.
  • But getting a better rollback rate (and a better appraisal system) is only relief, it doesn't fix the problem.  The more we've studied this issue, the more we've become convinced that no parts of the current system are worth saving and that property taxes should be scrapped in their entirety.  HB 1050, by Valoree Swanson, is the vehicle for that objective.

    Nothing can change the fact that property taxes siphon capital into nonproductive uses.  To the degree that government needs (Note: SIGNIFICANTLY less) revenue to deliver core services, that revenue should be derived from sales taxes.  Furthermore, the property tax system is the mothers milk that feeds all sorts of other corruption in the legislature.

    The problem is political: we're nowhere close, in either chamber, to getting the votes that we need to pass a bill like HB 1050.  Indeed, HB 1050 has yet to even be referred to committee. Eliminating property taxes will be a multiple session process.  To be honest, we'd be content with HB 1050 simply getting a hearing this session.  That being said, kudos to Valoree Swanson for starting the conversation.
Bottom Line: For the 85th Texas Legislature to qualify as a good session on property taxes, the bare minimum is for the Governor to sign SB 2 (in its current form) into law and at least a hearing on HB 1050....

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