The Texas Taxpayer Transparency Act
The House passed SB 2 on Tuesday. Our current property tax system lacks transparency. SB 2, the Texas Taxpayer Transparency Act, provides critical transparency mechanisms that empower taxpayers and voters by giving them a say in the property tax rate-setting process. A more open process is beneficial to everyone, and taxpayers deserve every opportunity to weigh in on how their taxes are being raised and spent.
The Texas Taxpayer Transparency Act encourages taxpayers and local governments to work together in setting a budget and adopting property tax rates that meet the needs and obligations of their community. This bill gives property owners the tools they need to make informed decisions by disclosing online and on tax notices who is proposing a rate increase, by how much, and when and where they can go to make their voice heard at a public hearing.
It also gives taxpayers the option of filling out a short online form to provide their opinion on the proposed rates, which is then sent directly to the taxing unit.
The Texas Taxpayer Transparency Act is not a revenue cap, it is a trigger. Current rollback election requirements put an unnecessary burden on taxpayers by requiring them to gather enough signatures to petition for an election. This bill empowers voters because it automatically triggers an election to ratify a property tax rate if it is raised above the rollback rate.
The Texas Taxpayer Transparency Act provides property tax reform. The budget and school finance legislation provides $2.7 billion for property tax relief. All three work together.
Meaningful property tax reform can not be achieved without school finance reform which is why the final passage of the Texas Taxpayer Transparency Act is contingent upon the final passage of the House's landmark school finance bill, HB 3.
Comment: This bill will unquestionably complicate tax rate setting. Elected city officials will not (and have so said) like it. However, it is long overdue. Ad Valorem taxes have been going thru the roof. The citizen has no say, except at the ballot box. I think that's a little Draconian for budget work. I feel running a city is a partnership between elected officials and the taxpayers. Clearly, both sides have to give some. Conversely, both sides should expect and demand fairness.
When property evaluations increase 8% a year and tax rates show little relief, ($0.01-$0.02 per thousand per year) something ain't right. Add that to increasing utility rates and increasing insurance rates, and the average wage earners and retired persons begin to have a very real cash squeeze. Everybody doesn't get 8% per year increases in income.