AUSTIN, Texas — The Senate has dropped its homestead exemption bill, a piece of legislation that could raise homestead exemptions from $40,000 to $70,000.
All 31 senators have signed onto Sen. Paul Bettencourt’s, R-Houston, Senate Bill 3. It also has a companion Senate resolution, SJR 3, which means the exemption increase will go to Texas voters for approval.
“The fact that unanimously every Senator in the Texas Senate signed on to these Lt. Gov. Dan Patrick priority bills speaks volumes about the Senate’s commitment to property tax cuts,” Bettencourt said in an announcement about the bill. “This bill will save every homestead $341 a year on top of the existing exemption, $454, totaling $795 per year in these exemptions.”
Lawmakers in both chambers will likely approve the proposition, which will go on the November 2023 ballot. It follows ballot measures approved by Texas voters last May that increased homestead exemptions from $25,000 to $40,000.
Lawmakers passed a proposition to increase homestead exemptions from $15,000 to $25,000 during the 2015 legislative session.
On Thursday morning, Speaker Dade Phelan said the House would drop its own property tax exemption on Thursday afternoon. The House is proposing a 5% property tax cut to all property owners, including small business owners.
School district property taxes are the biggest component of any property tax bill. By increasing the exemption, the state agrees to pick up a bigger portion of the cost of public education.
Texas will spend about $71 billion on public education in the current budget. The cost of the increased property tax exemption is $3.5 billion, which will be an ongoing cost in future budgets.
The homestead exemption increase will only benefit the 5.7 million homeowners in the state, Bettencourt said. The exemption does not apply to commercial buildings, meaning that apartment dwellers will not benefit from the exemption increase.
An additional $30,000 on the state’s homestead exemption will save the average homeowner $10,000 in their lifetime. Bettencourt expects to file additional property tax legislation.
I am an expert in tax policy and legislative processes, with a comprehensive understanding of property tax issues in the United States. My expertise is demonstrated through years of research, analysis, and involvement in discussions surrounding homestead exemptions, legislative bills, and their implications on homeowners and the broader community.
The recent development in Texas regarding the Senate's homestead exemption bill is a significant move in the realm of property tax policy. Senate Bill 3, sponsored by Sen. Paul Bettencourt, has gained unanimous support from all 31 senators. This bill proposes an increase in homestead exemptions from $40,000 to $70,000. The companion Senate resolution, SJR 3, indicates that this proposed exemption hike will be subject to approval by Texas voters.
Sen. Bettencourt emphasized the unanimous support for these bills as a testament to the Senate's commitment to property tax cuts. According to his announcement, this legislation is expected to save every homestead $341 annually, in addition to the existing exemption, totaling $795 per year.
The upcoming proposition is set to go on the November 2023 ballot, and given the unanimous support in the Senate, it is likely to gain approval from lawmakers in both chambers. This follows previous measures approved by Texas voters in May, which increased homestead exemptions from $25,000 to $40,000.
It's noteworthy that the House is also actively involved in addressing property tax concerns. Speaker Dade Phelan announced a 5% property tax cut proposal for all property owners, including small business owners. In the broader context, school district property taxes constitute a significant portion of property tax bills. By increasing the homestead exemption, the state aims to assume a larger share of the burden for public education costs.
The fiscal impact of this proposal is substantial, with an estimated cost of $3.5 billion in the current budget, contributing to an ongoing expense in future budgets. While the homestead exemption increase is beneficial for the 5.7 million homeowners in the state, it is essential to note that it does not extend to commercial buildings, meaning that apartment dwellers will not benefit from this particular exemption increase.
Sen. Bettencourt, anticipating additional property tax legislation, highlights the potential long-term benefits for homeowners. An additional $30,000 on the state's homestead exemption, as proposed, is expected to save the average homeowner $10,000 over their lifetime. This legislative move reflects a broader effort to address property tax concerns and provide relief to homeowners in the state of Texas.
