HB2 (2.5% Taxpayer Approved Rate) Watered down

OK, here are the problems with the watered down version of HB2 that came out of the Texas Ways & Means committee, chaired by Dustin Burrows:

1) School districts are now excluded from the 2.5% cap. There may be legal arguments that have some merit as to why this could not be done in HB2 as opposed to HB3, but I’m betting the POLITICAL arguments were the winning factor here. Chairman Huberty is the Lord of All Things Education; just look at his standing edict that no school choice bills will EVER get a hearing. so he had to be in control of that piece of HB2. And, while we am hearing SOME sort of voter approval rate will come out on schools in HB3, it WILL be weaker. We personally trust Burrows to be friend to the property taxpayers far more than Huberty.

2) Hospital and Special purpose districts now excluded. This will have MAJOR unintended consequences With hospital districts able to go up 8% without voter approval and counties limited to 2.5%, the counties will shove their healthcare budgets for indigent care off on the hospitals more and more. And Special districts will pop up like weeds for the express ability to tax at the FAR higher rate than cities without voter input. When you select ‘winners & losers’ in such a big way between types of government entities, you WILL shift power as well.

3) The ‘banking’ of unused rates for future use. This is a little more understandable to adjust for fluctuations in need, but will have the impact that- overtime- taxes WILL grow at the 2.5% rate, whether that much is needed or not.

Bottom line; before, this bill had our strong support as a stand-alone piece of legislation. It no longer does It ONLY gains reluctant support IF HB3 ends up containing something CLOSE to the same voter approval REQUIRED rate. And some version of tax swap such as HB2914 now NEEDS to be a piece of the puzzle to be able to declare any kind of success for the property taxpayers this session. HB1 assures there can be no claim of success for fiscal sanity, for sure; we need a win SOMEWHERE for the taxpayers.

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