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The apparent ‘Catch 22’ in the TX property tax rollback debate

On Behalf of | Mar 24, 2019 | Election Law |

Last month, we tried to shed some light on Texas Senate Bill 2 and the efforts underway in the state legislature to reform property taxing power by local municipalities. That post did not take a side on the wisdom of the bill. It only sought to highlight how, regardless of the outcome, local government entities will likely need to be more committed to finding creative means to achieve goals.

Companion measure currently before the Senate and House would further limit how much cities and counties can already raise property taxes. Right now, that cap is set by state law at 8 percent. The proposed new limit would be 2.5 percent. To get around the restriction, cities could put the matter to a local vote.

Could you go to jail?

The availability of putting the rollback issue before the people is a card supporters of the Senate bill have been playing to counter complaints from Local governments who say they are already scrambling to find ways to pay for services constituents demand. And while voters likely would welcome a direct election, the Texas Municipal Leagues suggests it’s not a viable solution at all.

The catch, as TML officials note, is that holding an election would require city leaders to make the case for why exceeding the cap is necessary. But, as Texas election law makes clear cities can’t use government resources to advocate for or against any ballot proposition.

The league argues that simply stating why a particular tax increase is needed in a given year would put city officials at risk of criminal prosecution, and facing significant fines, civil penalties and even jail if convicted.

One can debate whether the TML argument has merit or not. But in the absence of any accompanying legislation that grants local leaders the right to make the case for going over the rollback limit, it seems clear that finding the job of meeting needs and complying with apparently conflicting state laws will remain a legal challenge.



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