Tax Relief: A Process, Not an Event
Commissioner Tommy Adkisson
May 5, 2005
Some time ago, I read that leadership develops daily, not in a day. So it is with tax relief. Your Bexar County Commissioner's Court has cut or retained the existing property tax rate for the past ten years. This has been made possible by a combination of sound fiscal policies of the County, the Legislature mandating appraisal districts to conduct value studies and the healthy economy.
The value studies however, have the often troubling effect of keeping values on property rising. If appraisal districts do not "get value" (read appraise higher in a growing economy) in accordance with the studies, school districts can lose millions in funding! Interestingly, as local property values rise, the State gains revenue because its school funding responsibilities decrease. The State entity known as Bexar Appraisal District, which uses "Bexar" in its name, must achieve appraisals consistent with the value studies.
Unfortunately, the tax freeze is both permanent and regressive, freezing the wealthy, the middle class and working poor alike. In an effort to be more equitable than merely freezing taxes across the board for the over 65, Commissioner's Court considered a raise of the "Over 65" exemption from $50,000 to $60,000.
A $10,000 increase is a 20% greater exemption on a $50,000 home. However a $10,000 increase is a 10% greater exemption on a $100,000 home. The lower the home value, the greater the benefit given and vice versa, the higher the value of the home the less benefit given. That should be as American as apple pie and motherhood, but not so in the Texas Legislature!
Although three votes have existed on this Court to raise the exemption from $50,000 to $60,000, Commissioner's Court wisely decided to wait for the Legislature to conclude its efforts on property tax relief before charging forth with our version of property tax changes simultaneously. The City Council decided otherwise, prematurely placing the tax freeze on the ballot on May 7, almost a month before the Legislature adjourns. Just what chaos comes from every governmental entity "jumping on each's respective horse and riding off in separate directions" instead of coordinating is anyone's guess.
Additionally, Bexar County asked the Legislature to "index" the tax freeze to allow for the granting of a freeze based on an "affluence test". However, the House Ways & Means Chairman refused to allow this bill out of Committee. Indexing the tax freeze would have harmonized relief with the ideal of progressive taxation, an approach that I believe ranks right up there with the highest of values, civic or religious.
City versus County
Although Bexar County is not bound by referenda such as the City's referendum on Proposition 3, it naturally raises the question as to whether we at the County should follow suit with the City since the measure has passed. Of importance to Bexar County in contrast with the City of San Antonio is that 75% of our revenue comes from property taxes while 24% of the City's revenue comes from property taxes. The County has no CPS pass-through and no sales tax.
So far, no major counties save and except Nueces County (Corpus Christi) have adopted the freeze. Perhaps the reason for this is that people know that school districts are the primary consumer (about 70%) of property taxes in contrast with the 10 to 15% used by cities or counties. Also, the truly poor will not be driven out of their houses. Persons over 65 years of age can defer their property taxes till after death.
Bexar County taxes amount to $32 per $10,000 in value. If your house is valued at $100,000 and you are over 65, you pay $160 per year or $13.33 per month. If your house is valued at $50,000 and you are over 65, you pay nothing to the County.
As Commissioner, I work daily on a range of fronts to be fiscally responsible and to deliver high value for hard-earned tax dollars. There are no quick fixes or hocus pocus gimmicks by which we "give Barrabas" to the people. There is only hard work in areas such as energy conservation, open and competitive bidding for those seeking to do business with the County, and new techniques that save County dollars but which have not been tried here yet. The final frontier of our efforts should be to educate our legislative leadership about walking the talk of tax relief by providing it themselves before mandating us to both reduce taxes and take on more of what has always been the responsibility of Texas government.
I hope that the more that you learn, the more you will agree that it is the process not the "tax freeze" event that most needs our attention.