Key sticking point of tax cut deal cleared by House panel

The House Ways & Means Committee approved a property tax cut bill Thursday that appeared to resolve a disagreement between the House and Senate on a compromise tax relief package.

Leaders in both chambers had already agreed to ask Texas voters to approve a $10,000 increase in the homestead exemption. They had differed on when to hold the election, and whether the tax relief should be instituted for both years of the biennium or just the second year.

The Senate approved a bill that would set the election on Sept. 12 and institute the exemption increase for both years of the biennium. The House favored moving the election to November, when counties already have an election planned, and instituting the tax relief beginning in the second year of the biennium, a move that would cut the cost of the tax relief by about $650 million.

House Ways and Means Chairman Dennis Bonnen, R-Angleton, confirmed Thursday that his committee had approved moving the election to November, but still implementing the homestead exemption increase for both years.

County officials around the state had complained to lawmakers about the cost of holding a September special election, with some labeling it an “unfunded mandate.” However, they had warned that it would be very difficult to update this year's property tax bills in time if the election was pushed back to November.

According to the new version of Senate Bill 1 and Senate Joint Resolution 1 approved by the committee, county tax assessors will send out a “provisional” property tax bill before the November election that shows what a homeowner will owe in property taxes if the constitutional amendment passes and if it doesn't.