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    Legislative Services

    County Issues Newsletter | June 2023

    News Article | June 29, 2023

    Failure to Pass Property Tax Relief Leads to Veto Flurry, Special Sessions

    County News | Legislative News
    Legislative Services

    The previous edition of our County Issues newsletter was published May 26, just before the Legislature adjourned on May 29. The House and Senate signed off on a two-year state budget that set aside $17.6 billion for property tax relief but failed to reach agreement on a plan to deliver those savings. Gov. Greg Abbott wasted no time, immediately ordering the Legislature to reconvene the next day, June 1. The House followed pace and passed House Bill 1 on May 30 and immediately adjourned, leaving the Senate with a "take it or leave it" choice, as the House cannot reconvene without the Governor's order.

    HB 1 would deliver $17.6 billion in property tax relief through school property tax compression. Abbott immediately backed the House's plan. Lt. Gov. Dan Patrick stated the Senate would pass no such plan and the Senate passed Senate Bill 1, which would devote some funds to compress the maximum school district property tax rate, as in the House plan, but differs in focusing primarily on funding a $100,000 homestead exemption. Patrick also upped the ante by $400 million, to raise the total dedication for property tax relief to $18 billion. The impasse remains, and Abbott has promised to call lawmakers back in special session after special session until a property tax agreement is reached.

    Amid the back and forth, Abbott turned up the heat by vetoing 76 bills, falling just seven vetoes shy of former Gov. Rick Perry's record 83 vetoes in 2001. Some of the vetoes were related to property tax law, but the list included many unrelated items. Many of the veto proclamations voiced support for the vetoed legislation, but described the measures as not as important as property tax relief or school vouchers. Abbott is insisting the Legislature pass both priorities. When the special session drew to a close Tuesday with zero bills passed, Abbott immediately called lawmakers back for a second special session to "cut property-tax rates solely by reducing the school district maximum compressed tax rate and put Texas on a pathway to eliminating school district maintenance and operations property taxes."

    Patrick's response showed the jockeying leaders growing no closer:

    "We will insist upon a homestead exemption … We will pass the same bill that we passed to the House last week that cuts school property taxes for the average homeowner by nearly 43%, almost double the tax cut one would receive with only compression."

    Based on prior statements, Abbot will call a special session on the education matter after property tax relief is accomplished.

    For more information about this article, please contact Pete Winckler.