Texas voters overwhelmingly approved two ballot propositions to provide modest tax relief, each with over 80% support.

Proposition 1, which passed with 87% of the vote, will apply the legislature’s 2019 school district property tax reductions to homeowners who receive elderly and disabled homestead exemptions. The state estimates indicate this will reduce the average qualifying homesteads taxes by $110 in 2023 and $125 in 2024. It will go into effect on January 1, 2023.

Proposition 2 received 85% support and will increase the typical school district homestead exemption up to $40,000 from $25,000. The official estimates are that it will lower average property tax bills by $175 this year. It will go into effect immediately and apply retroactively to 2022 property tax bills.

State Senator Paul Bettencourt (R-Houston) authored both propositions in the Texas Senate.
“It’s an overwhelming recognition that Texas homesteads need property tax relief,” Bettencourt told The Texan. “It’s a relief that even complex constitutional language doesn’t get in the way of property tax relief.”
Bettencourt further commented that he expects “substantial tax rate deductions” across the state, even in Travis County, where property appraisals increased over 50% this year. He predicts that tax bills should rise less than 5% on average.
“We’re finally going to get to see the full benefit of SB 2 and HB 3 that were passed in 2019. The cavalry is really coming over the hill for homesteads,” he said.

“Victory for ALL property owners in Texas!” Gov. Greg Abbott tweeted Saturday evening.

Despite Governor Greg Abbot’s celebration following the results, the Texas Public Policy Foundation (TPPF) says more comprehensive reform is needed. According to the foundation, Texas property tax rates have increased by 181% over the last two decades.

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TPPF is attempting to garner support for the complete elimination of the Maintenance & Operations (M&O) tax rate levied by the school district. M&O taxes comprise half of all Texans’ property taxes. The TPPF has called for it to be bought down over 10 years using surplus state dollars to eliminate it.

However, Chandra Kring Villanueva, a program director at a nonprofit organization, Every Texan, which focuses on school finance, said the projected savings resulting from Proposition 2 are only a sliver of Texans’ tax bills.

“It’s not that meaningful,” Villanueva said. “What it’s really doing is slowing the growth of the school tax bill rather than seeing an actual savings for the majority of homeowners.”

However, more relief could be on the way as the Texas Legislature set aside $3 billion of the federal money sent as coronavirus aid for property tax relief during the 2023 legislative session.

Although the money had been regulated by a congressional prohibition that prevented its use to cut taxes, a district court in Texas struck down that stipulation last month, ruling that it was an overreach of federal authority.

“I expect there’s going to be more done, obviously, than this,” Bettencourt said. “But the good news is no matter what, that’s $175 in people’s pockets in perpetuity.”

Property tax relief was one of ten issues that Republicans were asked to give an opinion on in the March primary election.

More than 75% of Republican voters approved a ballot proposition in favor of eliminating property taxes. The ballot proposition is non-binding and helps lawmakers gauge party support or opposition to a measure.  The proposition asked voters if “Texas should eliminate all property taxes within ten (10) years without implementing a state income tax.”