Same Song New Verse with Lawmakers
on Collision Course on Property Taxes
Capitol Inside
February 27, 2025
The regular session is in the early stages of its seventh week and a train wreck already appears to be shaping up between the Texas House and Senate in the perennial fight for property tax relief in a state where they keep going up no matter what legislators in Austin do to harness them.
House leaders effectively set the stage for another showdown with the Senate on property taxes when Speaker Dustin Burrows touted a package of bills this week that's dramatically different than the proposal that cleared the upper chamber two weeks ago with Lieutenant Governor Dan Patrick's full-throated support.
But the fight over ad valorem taxation in 2025 is a replay for all practical purposes of a battle that ended in a crushing defeat for the GOP leadership in the House in a special session in the fall of 2023. Patrick and the Senate all but ran the table when the Legislature approved a substantial homestead exemption hike in a final plan that did not include appraisal cap restrictions that had been the centerpiece proposal for the House in regular session that year.
With Republican Dade Phelan leading the chamber as the speaker at the time, the House held out for lower ceilings on residential appraisals that Patrick said the Senate would not accept under any condition even though he'd been the chief advocate for such a move in the past. The House cut an apparent deal with Governor Greg Abbott before the initial special session in 2023 when the lower chamber passed a property tax rate compression measure on its first day then adjourned for the remaining 29 days.
House GOP leaders apparently thought the unusual power play would prompt the Senate to capitulate with a vote for a plan without the homestead exemption boost that the Republican lieutenant governor had championed. But Patrick never budged - and the final package that cleared the Legislature in a subsequent special session contained an annual vault in the homestead exemption to $100,000 with caps on the taxes that seniors pay on residences.
Patrick accused the House sponsor - GOP State Rep. Morgan Meyer of Dallas - of trying to kill the homestead exemption before portraying himself as the lead author for the provision instead. The Senate president sought vengeance at the polls in 2024 when he rallied behind a challenger who Meyer staved off in a primary contest that the incumbent won by 2 percentage points.
Meyer, who's returned to his role as the Ways & Means Committee chair, is sponsoring the package that Burrows is pitching in House Bill 8 and House Bill 9. Both were referred to Meyer's committee on Thursday. The panel set the bills for hearings on Monday.
HB 8 revolves on rate compression that had been a secondary feature in the final 2023 package with the homestead exemption as the main component. But HB 9 proposes to increase the personal property tax exemption for businesses from 2,500 to $250,000 in a move that represents a 9,900 percentage hike that would cost the state $700 million.
Texas taxpayers who own their homes would not get another significant break like they did in the past two years in the House plan. HB 9 could be dead on arrival in the Capitol's east wing as a consequence of the Senate's dependence on another major homestead exemption increase that Patrick favors in the plan that GOP State Senator Paul Bettencourt of Houston guided through the chamber with a unanimous vote on February 13.
Patrick has not offered an opinion publicly on the business tax exemption that House leaders are pushing. But it would appear to have little chance in the Senate without the breaks for homeowners that the lieutenant governor wants lawmakers to pass.
more to come ...
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