Some state legislators are hoping to reduce the amount by which local governments can increase property taxes in a given year, and many local officials are speaking out against the proposed legislation.
State Sen. Paul Bettencourt, R-Houston, filed Senate Bill 2, which caps the maximum amount taxing entities can raise in a fiscal year at 5 percent and forces the government to hold an automatic rollback election. Currently, a rollback election is triggered by a petition and only if a local government increases its tax rate by more than 8 percent.
Bell County Judge Jon Burrows and Belton Finance Director Brandon Bozon spoke out against Bettencourt’s bill Tuesday evening during a Senate Finance Committee hearing.
“One size does not fit all on this,” Burrows told the senators. “Let those closest to the people deal with the local issue. Local control does not mean Austin control.”
Temple City Manager Jonathan Graham said he’s opposed to the legislation. He echoed Burrows’ comments.
“Communities are all different and we all have different levels of growth,” he said. “What might work in West Texas where things are pretty stable or even declining wouldn’t work along I-35 where we have higher growth. I think that’s just a bad thing and I think it’s better to have a local option.”
Randy Pittenger, president of the Belton Independent School District board of trustees, said local control is always valued — except when state legislators want to control local issues.
“Many costs passed on to local school districts, cities and counties are due to unfunded mandates by the Legislature,” Pittenger said. “If the Legislature would focus on limiting costs by limiting unfunded mandates, local tax rates could be significantly impacted.”
Burrows has identified about 6.85 cents of Bell County’s 45.11 cent tax rate that go directly to fund programs mandated yet unfunded by the state.
Commissioner Bill Schumann said the actual amount of unfunded mandates on Bell County’s property tax is higher than what the judge estimated. Schumann said it’s closer to 11 cents.
Temple Councilwoman-elect Susan Long said another thing to consider is whether or not such decisions about tax rates should be made at the state or local level.
“It’s very easy to say that something should be handled locally, but then a smaller group of people get control over it and it’s not in the best interest of the public,” Long said. “But you can turn that right around and say the same thing at the state level. So many people are so upset by things being handled by the state or by the federal government.”
Temple Mayor Danny Dunn said the city has come close to reaching the existing rollback rate in the past.
“Last year, because the city was trying to add some more police officers, it caused us to get close to the rollback, but when we looked at it, we were able to rework it to where that would not have been a problem,” Dunn said.
Bettencourt has proposed SB 2 as a way to provide “relief” to taxpayers. However, for many of the officials interviewed by the FME News Service all the bill amounts to is political rhetoric.
“Real property tax relief can come in only one of two ways: adopt an alternative method of taxation altogether or shift a significant share of funding for public education back to the state,” Commissioner Tim Brown said.
Pittenger agrees with Brown.
“Instead of tweaking an obscure formula for setting tax rates, if legislators are serious about property tax reform, they should fix how the state funds public education,” the Belton school board president said. “The existing system is inequitable and unfair to taxpayers. Our taxpayers deserve a school funding system that produces substantially equal revenue for equal effort.”
If SB 2 becomes law, it will present challenges for cities when assembling their budgets, Graham said.
“Probably more than 50 percent of our budget is public safety with police and fire,” the outgoing Temple city manager said. “This will really make it harder for us to keep up with the demand for police and fire protection that our citizens require.”
The Belton finance director said residents would notice a real change in the city if the bill becomes law.
“People want increases in services, or at least they have expressed that in Belton. You’ve got to pay for them,” Bozon said, listing off how residents want to see new and improved parks and more police officers in the city. “Our council has fiscal responsibility very much in mind and tries to balance it with what people are requesting. I think they should continue to have the authority to do that.”
That’s the Belton council’s job, Bozon said.
“Having someone at the state come in and say ‘Nope. You don’t have to do that’ is frustrating, especially with the rhetoric the state sends back up to Washington about staying out of their business,” Bozon said. “I think the same thing applies to local government.”
FME News Service staff writer Mariel Williams contributed to this report.