Texas Democrats push property tax cut that includes renters

The proposal would give renters a cash rebate of up to 10% on rent paid in the last tax year.

By Sergio Martínez-Beltrán, The Texas NewsroomJuly 7, 2023 10:30 am,

From The Texas Newsroom:

Republican leaders in the Texas Legislature have been negotiating for months over the best way to cut property taxes in the state.

But those negotiations between Lt. Gov. Dan Patrick and House Speaker Dade Phelan — which, two special legislative session in, have not been successful — do not include relief for renters.

Now, House Democrats have introduced legislation that would give renters money back, along with providing a permanent salary increase for public school teachers.

“Our effort is one that recognizes that you can’t talk about property taxes without talking about public education,” bill sponsor Rep. John Bryant, D-Dallas, said Thursday. “You can’t talk about property tax reductions without talking about every Texan, not only homeowners, but also the 3.8 million householders who rent their homes.”

Under the Democrat’s proposal, $20.9 billion would be allocated to cut taxes.

According to a summary of the legislation, that money would be used to give homeowners a homestead exemption “of the higher of $100,000 or 25% of their home’s appraised value, up to a cap of $200,000.”

The Democratic plan also aims to help renters by giving them a cash rebate of up to 10% on rent paid in the last tax year.

“Renters deserve to receive their fair share of tax relief, especially as rents have skyrocketed in the past few years,” state Rep. Christina Morales, D-Houston, said.

Morales said Democrats and Texans “cannot ignore the fact that renters have been left out of this conversation” on property tax cuts.

The proposal also gives teachers a permanent salary increase of $4,300 per year by increasing Texas’ basic allotment — or per pupil funding — by $1,000.

Rep. Bryant said Democrats have been working on their plan over the last two weeks, starting when they learned a second special session would be likely after GOP leaders failed to reach a deal during the first special session last month.

Morales also called out Republicans for not reaching a deal.

“The internal divisions within their own party have hindered progress — we cannot afford to waste any more time, every special session costs taxpayers money,” Morales said. “In the light of this impasse, I urge my Republican colleagues to consider our plan.”

Speaker Phelan’s office declined to comment. Gov. Greg Abbott’s office didn’t respond to The Texas Newsroom’s request for comment.

Little movement on a deal

Phelan and Patrick have been at a stalemate over the best approach to cut property taxes for months.

Last week, the Senate passed legislation that redirects state funds to buy down the school districts’ maintenance and operations taxes — called “compression” — and increases the homestead exemption to $100,000. That plan also gives teachers a one-time supplemental payment of $2,000 to $6,000 over the state’s next two-year budget cycle.

But the Texas House seems poised — once again — to pass a similar measure to what that chamber approved during the last special session. Their plan includes compression but does not raise the homestead exemption.

There does, however, seem to be some movement this week.

On Wednesday, Phelan told reporters he met with Patrick and “talked about a lot of issues but mainly tax reform and tax relief for needy Texans.”

Phelan said he was hopeful. But, when asked if he believed a deal could be struck this week, he said, “there’s plenty of time.”

Texas Republicans have said they’d like to pass the measures and have them on the November ballot, since it would require amending the state’s constitution.

To make it on the ballot, the measure would have to clear all these hurdles and meet a key deadline in August.

If you found the reporting above valuable, please consider making a donation to support it here. Your gift helps pay for everything you find on texasstandard.org and KUT.org. Thanks for donating today.