Texas Governor Greg Abbott has introduced a six-point plan aimed at reforming the state’s property tax system. The proposal, unveiled during his reelection campaign kickoff in Houston, seeks to limit the authority of local governments over property taxes and spending.
Abbott’s plan would require several changes to the Texas Constitution. He emphasized that despite a record $51 billion allocated by the Legislature for tax relief this year, local governments offset those benefits by increasing their own levies. To address this, his proposal would tie local government spending growth to either 3.5 percent or the rate of population growth plus inflation, whichever is lower. Additionally, it would extend state debt and deficit limits to counties, cities, and school districts.
The plan also calls for requiring a two-thirds majority vote from residents before any new local property tax increases can be implemented. Residents could also initiate a rollback of existing taxes if 15 percent of local voters support such a petition. Abbott said these measures are intended to help control what he described as “runaway” local government spending.
To address concerns about rising appraisals, Abbott’s proposal would cap homestead valuation growth at 3 percent annually—down from the current 10 percent—and extend this cap to rental and commercial properties as well. Property appraisals would occur only once every five years instead of annually.
One significant aspect of the plan is giving voters the option to eliminate school district property taxes entirely through a public vote. School district levies make up the largest portion of property tax bills in Texas; however, Abbott’s outline does not specify how schools would be funded if these revenues were removed.
“Runaway” annual appraisal increases have been a frequent source of frustration among taxpayers, according to Abbott.
