Texas Lawmakers Promised To Increase School Funding And Lower Property Taxes. Here's What They Did.

May 28, 2019

The Texas Legislature usually finds a theme that emerges during the 140-day session. Two years ago, many people would call it the session of the “bathroom bill.” Even though an effort to restrict restroom access for the state’s transgender population did not become law, the debate around the subject took up much of the oxygen under the dome.

This year was the year of public school funding and efforts to slow property tax increases. Everything else took a back seat.

That doesn’t mean there weren’t other big debates or important bills. But when people look back on this session years from now, education funding and property taxes will be the things they remember.

Here’s a little breakdown of the two big bills:
 

Senate Bill 2 - Property Taxes

Lawmakers who supported this bill say it was a giant first step in efforts to slow rapidly rising property taxes. Those who oppose it say it doesn’t do enough to slow property tax growth. Others worry it could artificially limit city and county budgets.

SB 2 basically says that if a city, county, school district or other taxing entity wants to increase property tax revenues over a certain amount, voters get to approve or reject that increase.

An election is automatically triggered if a city, county or special taxing district tries to spend 3.5% more in property tax revenues than it did in the previous year. For school districts, it’s 2.5%.

Supporters admit this will not cut anyone’s property taxes, but they point to the long game with scenarios like this one: What would your property taxes be after 10 years of 8% growth each year? What would they be with a decade of 3.5% growth? Right, your tax bill would be lower under that second scenario.

House Bill 3 - Public School Funding

This was a bipartisan priority. Democrats have been pushing for about the last 20 years to increase funding of the state’s K-12 public school system. Republicans, specifically many in the Texas House, have also spent the last couple of sessions wanting the state to change how it spends education dollars and to spend more.

HB 3 does a bunch of stuff, but here are some highlights:

  • increases school funding by $4.5 billion
  • spends another $2 billion on teacher pay
  • pays for all-day pre-K for low-income students
  • increases state funding per student
  • decreases how much ISDs like Austin have to send to the state to help fund other school districts.
  • cuts property taxes by $5 billion

Oh, hello, did that last line get your attention? Yes, this bill – which focuses on improving the state’s education system – also cuts local school property taxes. Five billion dollars is a very large number; the cut you’ll get will be much smaller. There are several factors that go into determining just how much of a cut you might get, but if you’ve got a $200,000 home, you might get a $200 tax cut.

There are still a few questions about this law, including what kind of pay raises teachers and school staff will actually get. But the biggest one moving forward is how the state will pay for the law, including those tax cuts.