November 10, 2015
In Austin ISD, the average homeowner is paying about $1,000 in property taxes this year to help the state cover its constitutional responsibility to support public schools across the state. But reducing that property tax burden would require the state to fix its broken tax system.
Instead, those in control of the Senate will create the illusion of significantly reducing property taxes by focusing on city and county property taxes. And they try to deflect from their reliance on local property taxes by the same old statement that there’s not enough money, even as they actively cut other sources of revenue like the margins tax. They dig the hole and then point the finger at others even while they’re still holding the shovel. There’s not enough money because they’re in denial about the need to create more state revenue to reduce their reliance on property taxes.
Under the school finance formula, the state’s obligation to school districts goes down as property values go up and property taxes increase. That, in turn, frees up state tax dollars. All told, the state’s current two-year budget banks on local school property tax revenue increasing by $6.6 billion through a combination of property value growth and recapture.
Of that total amount, $4 billion will go to schools for new students and a small bump in per-student funding. Another $1.2 billion covers the cost of increasing the homestead exemption. And the remaining $1.4 billion of your property taxes? That was used to pad the state’s bottom line.