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State leaders seek deal on budget, other key issues

With less than three weeks left in the session, the governor and top legislative leaders are simultaneously negotiating compromises on five bills covering tax cuts, restraints on local property tax increases, border security, prosecutions of state ethics cases and open carry of handguns in Texas.

Officials from the offices of Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Joe Straus met Thursday afternoon with House and Senate leaders in a room behind the House chamber to juggle a complex set of issues that have bedeviled lawmakers for weeks.

“I am hopeful that we will be able to reach a resolution within 24 hours,” Abbott said late Thursday afternoon, referring specifically to the tax cuts.

The terms have not been completed, but several participants said they hope the talks could end multiple legislative standoffs before the end of the regular session on June 1.

The most important discussions involve ironing out differences between the House and Senate on more than $3 billion in tax cuts. Budget writers need a complete tax bill in order to finish their work on the two-year spending plan that is the most important bill of the session.

Negotiators have proposed ditching the House’s preferred sales tax cut in favor of property tax relief that would cost about $1 billion less than the version passed in the Senate, according to sources in both chambers. It would give homeowners an additional $10,000 in homestead exemptions, enough to save the average homeowner about $125 annually.

Abbott praised the $10,000 homestead exemption as a "way that we can reduce the property tax burden for Texans."

The deal would take the House's preferred approach to cutting the business franchise tax — a 25 percent across the board cut — rather than the Senate's approach, which would combine a smaller cut in rates and a provision freeing a large number of businesses from paying any tax at all.

Linked to that is the push for some restraints on local elected officials' ability to raise property tax rates. The state doesn't set those rates, but state officials have heard plenty from voters about property taxes.

Senate Bill 1760, from state Sen. Brandon Creighton, R-Conroe, aims to make the administration of local property taxes more transparent, directing the comptroller to publish a ranking of property tax rates statewide and requiring local entities to justify future tax increases on election notices and ballots.

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