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Bill to limit property taxes dead in Senate
Houston Chronicle Austin Bureau ^ | May 28, 2003 | ARMANDO VILLAFRANCA

Posted on 05/29/2003 2:49:56 AM PDT by demkicker

AUSTIN -- A tax relief bill appeared dead Wednesday in the Texas Senate, a victim of local taxing entities unwilling to lose millions of dollars in tax revenues the bill would have given back to Texas homeowners.

House Bill 3223, authored by state Rep. Dwayne Bohac, R-Houston, sought to limit annual property appraisal increases to 5 percent instead of the current 10 percent.

The bill passed the Texas House earlier this month by a unanimous vote and was not expected to face much, if any, opposition on the Senate floor.

Wednesday was the deadline for the Senate to consider any bills or joint resolutions on final reading.

But a majority of 25 senators told Lt. Gov. David Dewhurst they did not want the bill to come to a vote, effectively killing it, according to state Sen. Kyle Janek, R-Houston, the bill's sponsor in the Senate.

A last-minute attempt was being made late Wednesday to revive the bill, but supporters said it appeared unlikely that they could garner the votes to bring the bill back up.

"Kyle and I are getting almost no support," said state Sen. Jon Lindsay, R-Houston, who was asked by Dewhurst to poll senators in an attempt to determine if there was sufficient support for the bill.

Janek said senators were pressured by city and county governments who argued the bill would bankrupt them.

The bill would cut in half the current 10 percent annual cap on homestead appraisals. The bill also limited annual appraisal increases to 5 percent on commercial property and multifamily property such as apartments.

Currently, there is no cap on how much the appraisals on businesses or apartments can increase in a year.

The limit set in this bill, however, would not apply to property appraisals for taxes collected by public school districts and junior colleges. Mineral taxes also would be exempt from the 5 percent cap.

Though the bulk of tax revenues at the local level are generated by school taxes, local governments had a lot at stake because the bill would have forced them to raise taxes to make up for the loss in property value increases.

"They didn't want to give up their guaranteed tax increase, and that's a shame," Bohac said. "What that means is that millions of taxpayers lose."

Bohac said the bill would have controlled the rate of government spending.

"These local taxing entities have to learn to live within their means just like a Texas household does, and they don't want us to do anything that limits their ability to spend as much money as they want to spend," he said.

The bill's future was never assured as it moved through the legislative process. In its various incarnations, the bill seemed to teeter on life support only to be revived by last-minute compromises.

The proposal would have required a vote on a constitutional amendment in a statewide referendum in September.

"I'm confident that this bill will do what we want it to do and this is reduce skyrocketing appraisals without placing an undue burden on taxing districts," Bohac said earlier Wednesday.

Harris County Tax Assessor-Collector Paul Bettencourt has said the bill would have affected more than 1 million homeowners in Harris County but would probably initially have affected about 400,000 homeowners in its first year in 2004.

Property taxes paid by Harris County homeowners have shot up by 73 percent since 1997, Bettencourt said. Twenty years ago, money paid by homeowners represented 31 percent of the state's entire tax rolls. Last year, he said, homeowners made up 48.3 percent.

In Houston, he said, multifamily property values such as apartments have risen 75 percent in the past five years.

The bill had widespread support from homeowners, including a groundswell of support from Houston homeowners, who attended a March 13 hearing when a similar version of the bill was being considered by the Local Government Ways and Means Committee.

That bill, House Bill 474, co-authored by state Rep. Martha Wong, R-Houston, called for a 5 percent cap on homestead appraisals only. Bohac submitted an alternative bill that included multifamily and commercial property.

The bill seemed dead when it appeared before the committee April 28 and members voted against it. But the bill was revived with a compromise that exempted school districts from the 5 percent cap.

The bill's chief opposition has come from law firms that represent clients in disputes over property appraisals and county and city governments who feared the cap would result in less tax revenues.


TOPICS: Announcements; Breaking News; Government; News/Current Events; Politics/Elections; US: Texas
KEYWORDS: badpoliticalstunt; taxes; texas
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To: SolidSupplySide; Ron H.
The Harris County Appraisal District is not a taxing entity as this post suggests

I don't think Ron H. is suggesting that. The tax rate is applied to appraisal by the HCAD. Elected officials can shout from the rooftops that they didn't raise taxes.

21 posted on 05/29/2003 6:56:21 AM PDT by Flyer (© 1999 - 2003)
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To: Flyer
Just as the ten percent cap has guaranteed a ten percent increse each year. You would prefer a ten percent increase?
22 posted on 05/29/2003 6:57:11 AM PDT by FreePaul
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To: Flyer
In most cases, they are guaranteed a 10% increase every year. The central issue remains government spending; they just won't reduce it or even seriously talk about it. Unless this changes, someday ALL of our money will go to taxes.
23 posted on 05/29/2003 6:58:28 AM PDT by PetroniDE (Master (Sort of) of the Kitty Threads)
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To: FreePaul; MeeknMing; Flyer; Ron H.
It appears that Governor Perry will call a special session; I understand that the Governor controls what is on the special session agenda (if this assumption is incorrect, please provide correct information). What is required so that property tax relief is on the agenda?
24 posted on 05/29/2003 7:00:53 AM PDT by PetroniDE (Master (Sort of) of the Kitty Threads)
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Comment #25 Removed by Moderator

To: FreePaul
You would prefer a ten percent increase?

My preference would be for a real estate sales tax. Sure 5% beats 10% but it is still out of line with the rate of increase of property values.

26 posted on 05/29/2003 7:06:08 AM PDT by Flyer (© 1999 - 2003)
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To: Flyer
The tax rate is applied to appraisal by the HCAD.

That is the same as saying Wal-Mart is the taxing entity because it sets the price of items subject to the sales tax. While good rhetoric, such statements are objectively false.

27 posted on 05/29/2003 7:07:58 AM PDT by SolidSupplySide
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To: Flyer
Yes -- this is true -- but right now they are pretty much guaranteed to go up 10% -- and that is what these government agencies are doing, digging into peoples' wallets at an additional 10% each year. People in Texas are being taxed out of their homes. The Houston Chronicle article misrepresents what is going on by suggesting that government agencies are going to "lose" millions of dollars in tax revenues. This is patently wrong! This bill just limits the amount by which they can increase. This is slowing the rate of increase, but is not cutting taxes in any way. What Texans are asking for is a very MILD form of tax relief. What the Texas legislature is doing here is absolutely immoral. Tax revolt coming soon!
28 posted on 05/29/2003 7:10:48 AM PDT by bondservant (Taxation without representation)
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To: SolidSupplySide
That is the same as saying Wal-Mart is the taxing entity

No. A better analogy would be a third party that sets Wal-Mart's prices for them. Property owners don't set the value of their home.

29 posted on 05/29/2003 7:13:25 AM PDT by Flyer (© 1999 - 2003)
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To: Carlucci
Houston area Freepers should tune into AM 700 KSEV today at 4 p.m. Dan Patrick (the station owner) was pushing this bill and will no doubt use his radio station to slap a political target on those who allowed the bill to be killed.

You surely will not hear about this on that Other Talk-Radio Station Dan sold, they'll be discussing which city has the worst drivers.

30 posted on 05/29/2003 7:17:26 AM PDT by TexasCajun
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To: SolidSupplySide
The Harris County Appraisal District is not a taxing entity as this post suggests. I presume the poster does not know the difference between the Appraisal District and the Tax Assessor-Collector.

You sort of sound like one of those people I referred to in my earlier post. Yes, I know the difference between the two as do most folks here but I did fail to clearly state that but you failed to address the fact that the folks who should be responsible for setting the appraised value upon which the tax rate is based on property in Texas should not be entrusted to unelected and faceless bureaucrats' who are appointed rather than elected and do not answer to the tax paying citizen. Maybe you don't find that very important, not as important as attacking the messenger rather than the message itself.

Since they (AD) are the ones who set the appraised value on my home and of which the taxing enitity assesses the set tax rate then they are in effect an (non-elected) extension of the Taxing enmity you reference so keenly and thus relieves the localized politicians from having to raise the tax rate itself. You want to sound clever by half and maybe you are but understand, tax paying citizens like myself have had it with non-responsive spineless bureaucrats of which you come off sounding like one yourself then we tax-paying citizens are going to start making it very hot for these kind of yellow striped politicians. Take that and stuff it in your pipe and smoke it. The Appraisal District should still be abolished and have their duties returned from whence they came originally and should belong.

31 posted on 05/29/2003 7:18:08 AM PDT by Ron H.
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To: right wing
Interesting... Did property owners have to raise holy hell to make that happen?

It was a long drawn-out process in Michigan to limit assessment increases. In 1978 a voter initiative was adopted that limited aggregate property tax assessment increases in an area to the rate of inflation.

That meant, in a given city or other entity, the total property tax assessment for already-standing property could only go up at the rate of inflation. The problem was that businesses usually had the resources to fight any major assessment increases, so they'd get a token 1% increase and the average property owner would see a 5% increase.

As part of a school finance reform proposal pushed by then-Governor Engler in 1994, one of the components was a COLA limit on increases in property tax assessments by individual parcel. That proposal (which raised the sales tax and cut property taxes as well) was adopted by Michigan voters, so the COLA limit on each property has been in place ever since. It's very useful for financial planning to know that your property tax increases year to year are limited.

32 posted on 05/29/2003 7:25:00 AM PDT by Numbers Guy
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To: ppaul
You bet. Property taxes are an abomination. It would be interesting to know how many people are losing their homes due to them. The local papers are full of foreclosures.
33 posted on 05/29/2003 8:07:10 AM PDT by henderson field
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To: Flyer
"Property owners don't set the value of their home"? No, immigrants set the value of their homes: millions of immigrants since the 1965 Kennedy bill have increased housing prices far beyond the rate of inflation. Simple supply and demand. Good if you're in real estate. Good if you're selling. Bad if you're paying taxes. Bad if you're buying. Bad in the long run - it lowers standards of living. Soon we'll be like the Japanese.
34 posted on 05/29/2003 8:14:40 AM PDT by henderson field
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To: ppaul
federal law banning property taxes throughout the United States

Where in the US Constitution is the Federal Government given the authority to do this?

35 posted on 05/29/2003 8:23:17 AM PDT by jimkress
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To: Ron H.
They are no better in Bexar County. My appraisal has gone up every year in the last 6, except for one. I've had to go in twice to argue with them (usually successfully). My house is now appraised at 31% higher than it was 6 years ago!
36 posted on 05/29/2003 8:31:54 AM PDT by Alissa
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To: demkicker
The Tarrant Appraisal District has raised everyone's property values above market value, simply to impose a back-handed tax increase.

I appealed our property valuation when their numbers placed our home's value at $9,000 above an actual appraisal that we had just completed for refinance purposes. The Appraisal District employee had the nerve to try and tell me that our actual appraisal was wrong, and his numbers were correct. Finally, he relented and changed our valuation to match the actual appraisal. Unbelievable.

I feel so sorry for the senior citizens and others who thought they could afford a home in Texas, to simply be gouged by our greedy tax system.

Oh, by the way, just remember that our taxes are used to pay for the cattle herd to roam in the stockyards area of north Fort Worth.
37 posted on 05/29/2003 8:32:44 AM PDT by tamster
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To: tamster
I appealed our property valuation when their numbers placed our home's value at $9,000 above an actual appraisal that we had just completed for refinance purposes. The Appraisal District employee had the nerve to try and tell me that our actual appraisal was wrong, and his numbers were correct

The unmitigated gall these morons have never ceases to amaze me!
38 posted on 05/29/2003 9:22:43 AM PDT by right wing
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To: Flyer
A better analogy would be a third party that sets Wal-Mart's prices for them.

Wal-Mart *is* the third party. It is neither the taxing authority nor the taxpayer. Wal-Mart does, however, set the prices at which the taxpayer is taxed. The analogy is solid.

39 posted on 05/29/2003 9:44:22 AM PDT by SolidSupplySide
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To: demkicker
The fair method of assessment would be at time of sale ONLY. Until I sell it, it isn't worth more than I bought it, and if it is because of improvements, I have paid for those already too.
40 posted on 05/29/2003 9:47:17 AM PDT by DeathfromBelow
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