Jay Dean/Contributing writer
Back in 2019, Texas property taxpayers flooded the State Capitol desperately seeking relief from skyrocketing property appraisals and accompanying high property tax bills. Much of the emphasis was on the high rate of increase in appraisals in major cities like Houston, Dallas, Ft. Worth, Austin, San Antonio and El Paso.
There, local government officials would say tax rates weren’t rising, but increasing appraisals were pushing up actual tax bills. Back then, state law capped the amount of tax revenue increases in local governments at 8%. If local budgets exceeded the 8% cap, taxpayers could petition for a rollback election. But many complained that the 8% cap was too high, the petition process was too obscure and too cumbersome.
The State Legislature’s response was Senate Bill 2, written by State Senator Paul Bettencourt of Harris County. The bill largely addresses the concerns of big city taxpayers by lowering the cap to 3.5% and making the election automatic if a local government exceeds the cap.
As a conservative and a taxpayer, I strongly support fiscal responsibility. I believe elected officials should treat every tax dollar with the same care, as if it were their own. I know that every tax dollar collected represents someone’s hard work, late nights, early mornings, sacrifices made to earn that dollar. I am also proud to represent small, rural communities that have generally been excellent stewards of taxpayer dollars.
As former Mayor of Longview, I also understand the sometimes unpredictable budget constraints on small governments, like the rising costs to fill up the tanks of police cars and fire trucks.
During the debates over SB 2, many of us argued that a 3.5% cap on a small county budget was much more constraining than a 3.5% cap on the City of Houston’s budget. We advocated for exemptions and additional flexibility for our small cities and counties, but these efforts all failed. House and Senate leadership at that time opted instead to treat all 254 counties the same — from Harris County with 4.6 million people to Marion County with 9,990. The only concession we were able to add was a small “deminimus” amount that certain small governments could raise above the cap; however, the exception was so small that reports say only 4 Texas cities have qualified to use the exception since 2019.
I strongly support elements of SB 2, especially those that meaningfully protect the taxpayer and improve taxpayer oversight and budget management. For example, SB 2 dramatically increased transparency in the local government budget and tax rate setting process. But 3 years later, we can also see it is hamstringing our small county and city governments.
Today, thanks to the irresponsible, reckless, and downright foolish policies from the Biden administration, we are all facing rising costs. Extreme inflation is raising costs of normal street repair materials, insurance, fuel, and labor. Specifically, with inflation now over 8% and local governments limited to a 3.5% revenue increase, what choices do local officials have other than decrease services. The practical decisions these leaders are having to make is do they put fewer deputies on patrol, or fix fewer potholes? No amount of responsible budgeting in a small county or city can bring down the cost of diesel fuel needed to run fire trucks. And, yes, local governments have the option under SB 2 to hold an election for voters to approve revenue over the 3.5% cap, but the cost of administering the election is often more than they need to raise, making the voter-approved election the least fiscally responsible option. So now we find our rural counties and cities facing budget shortfalls, with no way to close them.
The legislature needs to reexamine these concerns in the upcoming 88th Legislative Session. We have to take another look at the balance between protecting taxpayers and allowing our local governments to function. One size clearly doesn’t fit all Texas cities and counties, and as is so often the case, rural counties are being lumped in with the large metro areas. East Texas shouldn’t have to suffer because of Harris County’s poor management. An easy remedy would be to return counties with populations under 250,000 to the previous 8% cap. Or, at a minimum, we should find a way to peg the cap to inflation. When the legislature reconvenes in Austin in January 2023, I will be bringing these ideas and the voices of East Texas taxpayers and local officials. You should make your voice heard, too. Do you want your local communities to be able to recruit police and fire? To be able to fill gas tanks on county road maintenance trucks? Together we can find a solution that works for all Texas cities, counties, and taxpayers.
In January 2023, Jay Dean will begin his 4th term as State Representative for House District 7. HD 7 currently includes Gregg and Upshur Counties. Beginning with the next Legislative Session, the District boundaries will change to include Gregg, Harrison, and Marion Counties. Before serving in the State House, Representative Dean served as Mayor of Longview from 2005-2015 and on the City Council before that.