On Wednesday, July 10, the Government Affairs Committee hosted State Senator Peter Flores, State Representative Steve Allison, and State Representative Leo Pacheco.
The three legislators focused their discussion in large part on the public school finance system overhaul and property tax reform measures put into place during the 86th legislative session. Below is a brief bio about each speaker, followed by a summary of highlights from the meeting.
Senator Pete Flores, SD 19 – Republican, first elected in 2018. Senator Flores serves on five Committees. Criminal Justice, Finance, Health and Human Services, Higher Education, and Natural Resources and Economic Development. He is a retired Game Warden and is a native of Laredo and graduate of Texas A&M University.
State Representative Steve Allison, HD 121 – Republican first elected in 2018. Representative Allison serves on Public Education and Public Health Committees. He spent 12 years on the Alamo Heights ISD Board including three terms as its President. He is a native of California and an attorney. He is a graduate of Texas Christian University.
State Representative Leo Pacheco, HD 118 – Democrat first elected in 2018, Representative Pacheco serves on Criminal Jurisprudence, General Investigating, and Higher Education Committees. He is a lifelong resident of San Antonio’s Southside. He has spent the last several years as a college educator for both UTSA and San Antonio College. He is a graduate of Harlandale High School and Texas A&M University San Antonio.
Property Tax Reform
For years, REALTOR® organizations across Texas have been partnering with lawmakers to fight for changes to the state’s property tax system. The goal was always to give taxpayers more information about how tax rates were set and how to engage in the rate-setting process that determines their property tax bill. Finally, with the help of these three San Antonio area leaders, the Texas Legislature agreed that property tax reform was critical and passed Senate Bill 2, also known as “The Texas Property Tax Reform and Transparency Act.”
This legislation, authored by Sen. Paul Bettencourt and sponsored by Rep. Dustin Burrows, implements several REALTOR®- supported measures that enhance transparency for taxpayers. The new law requires central appraisal districts to create online databases to:
- Show property owners how proposed tax rate changes would affect their bills and make it easy for taxpayers to submit comments via an online form
- Provide information about when and where a property owner’s local taxing entities are holding public hearings to set their tax rates.
The legislation also makes changes to the rollback rate that is currently at 8% for local taxing entities:
- Most cities and counties will be subject to a 3.5% rollback rate. Most cities and counties will have automatic elections if they exceed the rollback rate. (Currently, these elections may only happen if the voters petition for them.)
- Keeps rollback rate at 8% for special taxing units, including:
- Cities/counties with population <30,000
- Junior colleges
- Hospital districts
- Renames the rollback rate the “voter-approval tax rate”
- Renames the effective rate the “no-new-revenue tax rate”
School Finance Reform
The Texas Legislature unanimously approved legislation to reform the public school finance system and the property tax system: House Bill 3, authored by Rep. Dan Huberty and sponsored by Sen. Larry Taylor. This REALTOR®-supported legislation is a comprehensive reform of the state’s public school finance system and property tax system to lessen the burden on local property taxpayers while increasing the state’s investment in educators and students. One of the most impactful changes is the lowering of school property tax rates statewide, which provides $5.1 billion in tax relief through an average eight-cent tax rate reduction in 2019-2020 and 13-cent reduction in 2020-2021.
- Provides $6.5 billion in additional funding to public education and school employee compensation
- Increases the state’s share of education funding from 38% to 45%
- Reduces recapture by 47% ($3.6 billion) in the next biennium
- Raises the basic allotment from $5,140 to $6,160 per student, benefiting all school districts
- 3.5% voter-approval tax rate for ISDs
For those interested in further real estate industry-related policy discussions, please join the Government Affairs Committee on the first Wednesday of every month at 11:00 AM in the SABOR Board Room. The next guest speaker for August 7 will be Bexar County Commissioner, Justin Rodriguez.