Property taxes skyrocketing for Mansfield, Texas home owner
This story has been edited to correct the amount of the Hallfords' tax increase.
Robbin and Andy Hallford's annual tax bill has gone up nearly $1,200 since they bought their home in Mansfield five years ago.
"We're starting to get priced out of this house," Robbin Hallford, a high school science teacher, said.
Their four-bedroom home with a swimming pool in the Arbors of Creekwood neighborhood was valued at $295,106 in 2017, up from $226,000 in 2013. And, the value is expected to be even higher when Tarrant County tax rolls are certified later this year.
Although it's nice to own property that increases in value, the Hallfords are worried about how much of their monthly income goes toward property taxes. Like many Texans, they would like to know why many area property tax bills have spiked 40 percent or more since 2010 while the area's population growth is closer to 15 percent.
The Hallfords are left with other questions, too. Where is all that money being spent? Will their tax bill rise again next year, and each year afterward?
Hallford says she still considers her house a "dream home," and she is glad to live in a neighborhood she and her husband admired for years before moving in. And it helps that their grown son and his fiancee recently moved in, and help with bills.
But she said their decision to move into the neighborhood has left them "a victim of our own good judgment. The values have gone up so much, which is great, but I can’t afford to move anywhere else.”
Who to blame
Who should be blamed for Texas' upwardly-spiraling property taxes depends upon whom you ask.
Texas is one of nine states with no state income tax, and relies heavily on sales taxes, property taxes and fees to pay for government services.
Republican Texas Gov. Greg Abbott has turned the spotlight on local governments, arguing in a 33-page proposal that cities, school districts and other local governments need to hold the line on payroll and other expenditures. His proposal, which likely will be considered during the next legislative session beginning in January, would prohibit local governments from raising property taxes more than 2.5 percent per year — unless two-thirds of voters in that jurisdiction approve a higher amount.
Abbott argued that, since 1997, property tax collections have nearly doubled, and that a new state law is needed to control local spending.
"Because the property tax is prolific at spinning off revenue to schools, counties and special purpose districts, it is a singular cause for the growth of local government in Texas and the massive increase in the number of public sector workers," Abbott wrote in page six of his report.
But Tarrant County Judge Glen Whitley, also a Republican, said Abbott's proposal "would be crippling" to local government entities in Dallas-Fort Worth.
Whitley says it's a case of misplaced blame to fault local governments for rising costs. He said much of the burden comes from unfunded mandates from state government.
For example, Whitley said, Texas counties pay more than $216 million annually for indigent defenders in state court cases (for people charged with crimes who can't afford a lawyer), without being reimbursed by the state. Counties pay more than $106 million to house state prisoners in local jails, again without reimbursement, Whitley said.
Also, Whitley said, because more than half of property taxes go to schools, some Texans might incorrectly assume their money is spent to improve education in their district. Instead, because of the state's "Robin Hood" school funding law, when a school receives a larger share of property tax revenue, its share of state funding is cut.
In the Grapevine-Colleyville school district, for example, chief financial officer DaiAnne Mooney said she expects property valuations to generate an additional $10.6 million this year compared to the year before, but the district likely will keep only $600,000 of that. The remaining $10 million will go to the state for Robin Hood.
“It’s not as if the taxpayers are writing bigger checks that the district gets to keep that money,” she said. “We’ve seen property values increasing over the last five years. Our enrollment numbers are stable. We don’t have the growth in students to offset it.”
Rainy day fund
Statewide, property tax funding paid by land owners for schools has increased $14.34 billion since 2015, while the state's school funding contribution has increased only $2.17 billion during that time, Whitley said.
That situation has allowed Texas to fatten its rainy day fund to $11 billion, Whitley says, while forcing local governments to pay a higher share of costs once shouldered by the state.
"They seem too focused on trying to take control of local government, instead of taking care of the issues they ought to be taking care of," Whitley said. "They have built themselves a rainy day fund at the foot of local taxpayers, and they sit down there and point the finger at us and accuse us of liberal spending."
Where the money goes locally
At the local level, school districts, cities and other local governments soon will receive estimates from the Tarrant Appraisal District projecting how much money can be expected during the next fiscal year, which starts in the fall. The July estimate is usually considered an accurate predictor of how much revenue local governments can expect after final tax rolls are certified each September.
Budget directors from those entities will use those estimates to determine a tax rate for property owners beginning in the fall — and, in many cases, property values are escalating so quickly in the Dallas-Fort Worth area that even in areas where governments drop the tax rate most home owners will pay a substantially higher bill.
In Fort Worth, for example, the population has increased 17.9 percent since 2010. The population in 2017 was 874,168, compared to 741,206 in 2010.
But during that same time, the city's net taxable value has increased more dramatically — 43.4 percent. The city's net taxable value was $57.1 billion in 2017, compared to $39.8 billion seven years earlier, according to the Tarrant Appraisal District. The net taxable value is used by cities, school districts and other local governments to set property tax rates.
Based on that net taxable value, Fort Worth's property tax revenue increased 30 percent from 2010-18. The city is expected to receive $465.5 million in property tax revenue by the end of the current fiscal year, compared to $356.8 million in 2010 — including property taxes for general fund and debt service.
Where does all that money go?
▪ The city's fire budget went up 38.1 percent, to $145.2 million, up from $105.1 million.
▪ The police budget rose 34.7 percent, to $239.8 million, up from $178 million.
▪ Transportation is up 13.1 percent, to $58.2 million, from $51.5 million.
▪ Economic development rose 208.6 percent, to $21.6 million from $7 million.
In Mansfield, on the southern end of Tarrant County, the lack of property tax relief was a top subject during the City Council election in May. The fast-growing city has maintained its tax rate at 71 cents without a homestead exemption since 2008. But even as the rate stays the same, property owners have seen their tax bills increase as much as 40 percent in just a few years.
For most home owners, money for property taxes is set aside each month as part of their mortgage payments.
Mansfield Councilman Casey Lewis is a Realtor, so he hears stories firsthand of people who struggle amid rising property values. He made reining in property taxes a cornerstone of his campaign this year as he defeated a long-time incumbent.
“It is a priority to find property tax relief for Mansfield residents whatever way that we can,” Lewis said. “It’s probable that it’s not going to happen in 2019. As much as I would love to see it happen I don't know if I can make it work this year.”
Lewis has directed city staff to look at three scenarios: A 10 percent homestead exemption, a 10 percent homestead exemption with a $30,000 cap and a 20 percent homestead exemption. Such exemptions would lower the taxable value of many residents' homes, which would lower their tax bills.
Mayor David Cook said he opposes putting a cap on revenue increases because Mansfield needs to build infrastructure to keep up with growth in the city. He said the city needs to hire more firefighters and police officers, and build a fifth fire station.
“You’re penalizing cities that are still growing,” Cook said. “That’s the problem with doing a one-size-fits-all.”
But other local officials support the concept of capping property tax revenues.
Among them is Colleyville Mayor Richard Newton, who said, while it’s still early in the budget season, the plan is to adopt the effective tax rate for the coming budget year. The effective tax rate raises the same amount of revenue as the previous year.
Because Colleyville’s property valuations will increase by about 9 percent, the city is able to trim the tax rate and still operate on the same budget.
But even so, the city will have to reduce expenditures to offset the cost of annual employee salary increases, increased health care costs and other routine expenses.
“To do that, we literally have to reduce expenditures somewhere near $1 million," Newton said.
Unlike many of its neighbors, Colleyville doesn’t have a homestead exemption, which allows homeowners to shave a percentage of their home’s value before calculating their tax bill. Instead, Colleyville has lowered its tax rate more than 2 cents in two years.
Cheaper in Oklahoma
In Mansfield, Hallford's parents, who are retired and living in Oklahoma (in the Tulsa area), wanted to move closer to their grandchildren, but have decided to stay in Oklahoma out of concern for Texas' rising property taxes.
Hallford said her tax bill is double what her parents pay, even though her parents live on a lake in a home that is 600 square feet larger than hers.
"That’s had a big impact on our family," she said.
This report includes information from the Star-Telegram archives.