A conservative suggestion for a new source of tax revenue

February 14, 2019

The recommendation below is as an element for a ‘tax swap’ related to reducing local property taxes related to school M&O, NOT as more overall money for government.

Conservatives rarely come up with new taxes due to their belief in less government. But to generate relief in areas of overtaxation- such as the current Texas property tax situation- it sometimes is important to not only reduce taxation, but shift some of the burden onto untaxed sources. And there is no greater amount of untaxed revenue than the all-cash underground economy that, in large part, supports illegal immigrants. This untaxed income does however, surface to visibility in significant amounts in one place: wire money transfers.

Cash transfers from the U.S. represent the 2nd largest source of hard currency for Mexico- and the largest source of hard currency in several Central American countries. More importantly, a large share of this is from labor from illegal immigrants, many who are receiving cash-only payments for their labors to avoid federal income tax collection- and to avoid income declarations that would render their families here ineligible for government benefits. Some of that money gets sent home via wire transfers, primarily through services like MoneyGram and Western Union; 40% of all MoneyGram transfers go to Mexico, for example.

So, my recommendation is to look to apply taxation to these transfers, since much of it is vastly undertaxed in relation to other parts of the economy. The least that could be done would to remove the sales tax exemption from the wire transfer service fee, which runs anywhere from $4-$27 depending on the service and amount sent; it probably averages around $9-$10. Ideally, it would be limited to transfers to foreign destinations if possible; but it not, applying it to all transfers is acceptable. We’re talking an average of less than a dollar per transfer: hardly a large burden (nor a large source of revenue) but it would send an important initial message that could be followed up on.

Of far MORE significance, I also would suggest investigating application of a percentage fee on the amount sent by wire transfer, if possible. Even a 1-2% charge for every dollar sent would be a truly significant revenue source, if it can be accomplished legally and politically.

I make these recommendations at significant personal cost. I do direct aid to orphans and poor families in Uganda; a network of support outside the usual charitable organizations, mainly to benefit some who have either ‘aged’ out of the orphanages or their families. I do this by sending wire transfer to trusted people I’ve met over there and know well. I send over 50 transfers a year, totally $8,000-$9,000/year; since I don’t work through 501c3 anymore to do this, I do not get a charitable deduction on my tax return. My proposals would cost me out of my own pocket, but I support them and would testify effectively for them when needed.


Rural Property Owners becoming 2nd Class Citizens?

February 10, 2019

From some of the things that happened last session, they are already on the way to that status. SB2 & HB2 only will worsen this, if the total exemption of ‘small govt entities’ is left in place. Last session, they did precisely that in dealing with forced annexations, exempting smaller counties from protections for property owners. Other past bills have had similar ‘rural exemptions’, but few have dealt with what is more about basic property rights than ‘uniquely rural’ characteristics needed for governance. And the current SB2/HB2 bills worsen this schism by exempting all government units of revenues below $15 million from anything but the 8% rollback rate.

But WHY are these exceptions being created? Very simple; brutal politics. A number of rural representatives and Senators are less afraid of their voters than their County Sheriffs & County Judges- who hold far more political power than their counterparts do in urban areas.  And those county officials want NO changes that lessens their control. And, sadly, the legislators so controlled hold the numbers to prevent any bill from moving forward. Unfortunately, too few of the rural property owners know this is going on- or care. So the schism develops- or NO ONE moves forward. However, this time there IS push back- and that pushback needs to be strengthened. As much as we in the suburbs & cities want the rural property owners to have the same rights, the rural legislators will ignore us as non-constituents , it is up to the rural people to DEMAND their rights.

We need to pressure ‘political expediency’ back toward what is right. So we also need to pound another point into the collective GOP mind. The ONLY thing that saved the statewide GOP this last election WAS the rural areas.  And if they are so openly slighted by the GOP majority in the state legislature, what do think their mood will be about voting in November, 2020? I’m not thinking they would switch to the Democrats; but their TURNOUT might be depressed- and that could spell disaster. The State GOP MUST deliver property tax reform & relief to the rural voters.

One other area of concern: special-purpose districts.  These are often smaller entities and subject to much abuse; too few of them would be covered under the current bill’s $15 million level. They should be subject to the lower ‘voter approval rate’  if they are $1 million or larger.
If for no other reason, That I would think (if it’s legal), some larger entities might try creating special districts within themselves to break up some of the tax load  at a level to avoid the 2.5% voter approval rate limit. A special water district, a special street district, etc. Not sure if the rules of special districts would allow it, but someone more knowledgeable in them could comment below.  Either way, they should come under the lower voter approval rate to improve control of abuse.


SB2 Testimony and Progress

February 9, 2019

More information is now available on the bill: the Fiscal Note is here (The negative numbers represent potential savings from current property tax trends) and the analysis is here (fairly thick reading).

Public testimony went well for taxpayers on Feb. 6th and was enlightening to both the committee, people watching remotely and even to the opposition to the bill. Here is a list of the witnesses For and Against. you might want to search the list for the officials in your area, or friends you know are active in this effort.   And here is the full video of the public hearing, for review. The timestamp of the some of more interesting testimonies are listed below: Will add more as I review them:

Invited Testimony:

  • TPPF representative & Former Austin City Council member Ellen Troxclair in support of SB2: 1m 20s
  • Marya Crigler, chief Appraiser for Travis County: 16m 3s
  • Collin County Judge Chris Hill, representing unanimous support of the commissioner’s court for SB2: 1h 24m 12s

Public Testimony

  • Elizabeth Raich (sp?); chief financial officer of City of Dallas. Opposed and Sen. Bettencourt takes on her opposition: 1h 52m 35s
  • Michael Openshaw, author of this site, in support of SB2 (folks say I did pretty well, you can judge & post comments)): 1h 51m 26s

Please post in comments other timestamps of good testimonials- or really awful ones .

 


Alert! SB2 Public Hearing; Wed. Feb. 6th Austin

February 2, 2019

This will be a FIRST hearing on Property tax reform and relief and our supporter need a GREAT turnout of property taxpayers to set the tone.
SB2 represents essential property tax REFORM that is critical to have in place to protect any actual RELIEF they come up with for the over burdened property taxpayers. This reform restricts future growth of your property taxes to 2.5% without a MANDATORY vote by the people on a standard election day in November. Without this, if the state were to arrange other reductions to this component, the appraisal districts could wipe that out in one year.

Realize this is a SMALL start and a school financing piece is being worked separately. But if support for this is not shown by activist taxpayers, the next pieces of reform & relief will just evaporate, crushed by the professional political class.

WE DESPERATELY NEED TAXPAYERS TO SHOW UP TO SUPPORT THIS FEB. 6th!! The room is E1.012

Registration for the hearing begins at 8am and the earlier registered, the earlier you’ll be called for your 3 minutes. The testimony does not actually start until 12:30pm and will run late in the day. That morning and early day time can be very valuable to visiting various offices. to register your support for SB2 and the identical HB2 in the House.  I would start with the House members of the Ways & Means committee, since the Senate Property Tax committee will be hearing from you in the hearing. Also go by oyur LOCAL reps offices- and be sure to go by the Speaker Bonnen’s and the Lt. Governor Dan Patrick’s offices to thank them or their support and unity on property tax reform and relief. In the lists below, our ‘BEST friends’ are in bold; the others need various levels of ‘selling’. Democrats are italicized but don’t pass on ‘selling’ them as well. Cole & Rodriguez are from Travis county & their communities are being DECIMATED by rising property values & taxes.

Position House Ways & Means Committee Office Phone
Chair: Rep. Dustin Burrows E2.722 512-463-0542
Vice Chair: Rep. Ryan Guillen 1W.3 512-463-0416
Members: Rep. Dwayne Bohac GS.6 512-463-0727
Rep. Sheryl Cole E1.218 512-463-0506
Rep. Trey Martinez Fischer 3S.2 512-463-0616
Rep. Jim Murphy 4N.3 512-463-0514
Rep. Candy Noble E1.412 512-463-0186
Rep. Eddie Rodriguez 4S.5 512-463-0674
Rep. Scott Sanford E1.408 512-463-0356
Rep. Matt Shaheen E2.718 512-463-0594
Rep. John Wray E1.302 512-463-0516

On the Senate side, we have LOTS of ‘BEST friends’ (and even Hinojosa is not that bad for a Democrat)

Position Senate Property Tax Committee Office Phone
Chair: Sen. Paul Bettencourt 3E.16 512-463-0107
Vice Chair: Sen. Angela Paxton GE.5 512-463-0108
Members: Sen. Brandon Creighton E1.606 512-463-0104
Sen. Kelly Hancock 4E.2 512-463-0109
Sen. Juan Hinojosa 3E.6 512-463-0120

Speaker Dennis Bonnen: 2W.13 : 512-463-1000   Lt. Governor Dan Patrick2E.13512-463-0001

Here is the link to the SB2 bill in TLO: here is the Word version & here is a more compact text version. It’s a lengthy bill and you may not get a chance to read it in it’s entirety. Here are the bullet points involved:

 


Training Materials: TX Lege Online and Advocacy

January 23, 2019

Here are various training materials, most of which is the exceptional work of Barbara Harless (many thanks to Barbara for making them available). If you want to learn about Texas Legislative Online (TLO) or legislative advocacy in general, here are some videos, along with a powerpoint & handouts.

BARBARA HARLESS

MICHAEL OPENSHAW

RACHEL MALONE


Texas Senate Committee Assignments are Out

January 19, 2019

Here they are and it’s full of good news!

The new Property Tax committee is full of the most conservative members of the Senate, with Hinojosa being the lone Democrat:
Senate Property Tax Committee
Paul Bettencourt, Chair CAP 3E.16 (512)463-0107  EMAIL
Angela Paxton, Vice Chair CAP GE.5 (512)463-0108  EMAIL
Brandon Creighton EXT E1.606 (512)463-0104  EMAIL
Kelly Hancock CAP 4E.2 (512)463-0109  EMAIL
Juan “Chuy” Hinojosa CAP 3E.6 (512)463-0120
  EMAIL

Sen. Jan Nelson was, as expected, was named Chair of Finance. Within 3 hours, she’s already scheduled 18 meetings of that committee; nearly every day starting Jan. 22nd. She is VERY serious that education finance reform won’t fail for lack of effort! We plan to try to testify the first week there to address the need to make room in budgeting, as they try to redo education funding, for some property tax relief (especially In Robin Hood which will literally crush a handful of ‘wealthy’ districts before next session meets).  This committee will ALSO need to be reminded how much property owners are hurting.

The one bit of controversy? Sen Kel Seliger was mad Agriculture Chair and taken off as Higher Education Chair and replaced with Sen Brandon Creighton, a far more conservative member. Seliger feel dissed & disrespected. Lt. Gov. Dan Patrick shrugged it off, pointing out that Agriculture is a big part of Seliger’s panhandle/ west Texas district. ,


The Texas Senate Proposed Budget is Out

January 17, 2019

Here’s a link to the nearly 1,000 pages of SB1;

track the progress & later amendments here.

Sen. Jane Nelson is the author & will assuredly be the Chair of the committee to handle it.    It has A $5,000/teacher raise built in (average 9.4%) yet spends $3 billion less than house proposal  WIll update this with other factors as they are clarified by far greater financial wizards than are here. Naturally, we’re MOST interested in any property tax relief that is factored in, if any. We haven’t heard of anything specific.

Sen. Jan Nelson has the Teacher raise as a SEPARATE bill- SB 3- linked here.

The Legislative Budget Board proposed Budget Summary is here.  Being Straus was a major driver of this, I take it’s content as this with a LARGE grain of salt.

Here is a good comparison of the House & Senate budgets to the Texas Public Policy Foundation’s ‘Conservative Budget’. The good news is that the amounts are not HUGELY off (though- when talking in billions- they are ALL huge.). The question truly is- how much property tax relief will we get- and in what form.  It is NOT defined as off yet in EITHER budget. .