Posted on 04/26/2005 1:22:32 PM PDT by Cat loving Texan
Revenue cap bill passes House with push from Craddick Proposal would make it easier for voters to challenge city and county tax increases.
By Stephen Scheibal AMERICAN-STATESMAN STAFF
Tuesday, April 26, 2005
The House on Tuesday passed one of Gov. Rick Perry's signature tax reforms, 80-65, ending a monthlong debate that has flummoxed lawmakers and split Texas Republicans.
The halting discussion on House Bill 1006 lasted more than an hour and was marked by claims of fatal technicalities in the bill, amendments on top of amendments and dueling economic indexes.
But in the end, a slim majority of House lawmakers — pressed by a series of relatively rare public votes by Speaker Tom Craddick — lined up behind the measure.
"This legislation addressed every concern that was raised," said Rep. Carl Isett, R-Lubbock, and the measure's sponsor. "This was always a process, not an event."
The proposal would make it easier for voters to challenge city and county tax increases. Current law allows voters to petition for a rollback election when property tax revenue increases by more than 8 percent. Isett's bill lowers that election threshold to 5 percent.
It also would reduce the petition requirement from 10 percent of the registered voters to 10 percent of the turnout from the previous gubernatorial election.
Perry has campaigned for the measure, saying the state needs it to protect any property tax cuts the Legislature passes this session.
But most cities and counties bitterly oppose the measure, saying it would tie their hands in trying to raise money. A coalition of Republicans and Democrats has held steady in fighting the bill, with most citing the same issue.
An amendment last week would have increased the cap by adding inflation calculated by the Municipal Cost Index, a gauge used by cities and counties that incorporates three federal indices, to the 5 percent threshhold. Thus, 3 percent inflation added to the 5 percent rollback rate would mean tax revenues could increase by 8 percent before voters could petition for an election (the measure would not have allowed for rollback rates of more than the current maximum of 8 percent). The amendment also would have allowed cities and counties to raise additional money for requirements the state mandates but does not pay for.
But Isett persuaded his colleagues to alter that amendment in ways that, his opponents said, gutted last week's measure. His proposal on Tuesday would use the Consumer Price Index, a widely recognized rate that accounts for a different basket of price tags and typically does not rise as quickly as the Municipal Cost Index.
It also would force local governments to choose between the 5 percent cap and the Consumer Price Index, meaning inflation would have to pass 5 percent before officials could take more money from the change. It does, however, still account for unfunded mandates.
While Isett called the final bill a good compromise, his most vocal opponent — Rep. Fred Hill, R-Richardson — said the bill does "nothing good."
"This bill is a fast poison for the cities and the counties in this state," Hill said. "This will change the way Texas funds cities and counties."
Before debate even began this morning, the bill's opponents pointed out technicalities that kicked the measure to the beginning of the legislative process for the third time. Such tactics already had pushed back two scheduled votes.
But Craddick never had been as vocal on the issue as he was today.
The Speaker rejected every technicality that the bill's opponents raised in their efforts to scuttle another vote. He also registered his opinion three times on the House floor.
"Never underestimate the power of the gavel," Isett said.
Hill also attributed the bill's newfound success to intense pressure from Perry and Craddick. He said Perry was calling lawmakers in to discuss the issue as late as today, and that Craddick always has been a strong supporter.
"The speaker," Hill said, "is a person who doesn't lose."
sscheibal@statesman.com; 445-3819
He just got re-elected.
It still has to pass the Senate.
If the housing buble bursts, then property tax revenues must also go down.
Property taxes MUST be caped and there should be a way to give greater homestead protection.
I think it will. I can't say KB would be any better.
I have a novel idea.
CUT SPENDING!!
Truth in Taxation Light
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