February 8 , 2019

Inside this edition of Capitol Roundup:
Reminder: Register for Legislative Day in Austin on Feb. 25-26

Abbott continues to advance school finance and property tax reform as top issues for Legislature to tackle

Property tax bill faces first hurdle in a Senate committee where local leaders lined up to oppose the measure

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AGC Texas Chapters

Quote of the Week

"I'm inspired by the camaraderie and the collaboration that has already infused this session. It seems unprecedented. But I've got to tell you, I'm feeling it myself, I'm feeling moved and I want to set the example."

- Gov. Greg Abbott
Gov. Abbott  made the comment this week in his State of the State address in Austin. The governor has been in lockstep with leaders in the House and Senate on issues like property taxes and school finance, and on Thursday Abbott - a UT alumnus - mentioned he would support the return of an annual rivalry football game between the University of Texas and Texas A&M University.
Register today for our 2019 Legislative Day in Austin!

Join us at the Capitol for Legislative Day on Feb. 25-26!  All chapter members are welcome to take advantage of this unique opportunity to meet with legislators and other AGC members from across the state. Register here.

Monday, Feb. 25 - Evening reception at The Austin Club starting at 5:30 p.m. for registration and cocktail hour. 
Tuesday, Feb. 26 - Legislative Day in the Capitol Extension Auditorium (Room E1:004). 
School finance, property tax reform top Abbott's list of emergency items

In his State of the State address this week, Gov. Greg Abbott advanced the same issues that he and Republican leaders have been promoting since the beginning of the legislative session - property tax reform and school finance. 

Abbott's emergency-item designation allows lawmakers to take action on the legislation sooner than other measures, which typically cannot be passed within the first 60 days of session. T he governor also declared school safety, disaster relief, and mental health as emergency items. 

The governor's stake in the two bread-and-butter issues came as no surprise as he, Lt. Gov. Dan Patrick, and House Speaker Dennis Bonnen have placed these areas of reform at the top of the legislative agenda this spring. The issues will be familiar to most lawmakers in Austin too, as legislators have been wrestling with them for the last several sessions. 

Gov. Greg Abbott gave his State of the State address Tuesday, as Lt. Gov. Dan Patrick looks on
"We can no longer sit idly by while property owners are reduced to tenants of their own property with taxing authorities playing the role of landlord," Abbott said of a measure that would limit the amount of revenue growth generated from local property taxes. 

And on providing more funding for schools, the governor said, " Texas must recruit and retain the best and brightest teachers to educate our students. This session, we must pay our teachers more.  We must provide incentives to put effective teachers in the schools and classrooms where they are needed the most."  

While leaders have been beating the drum on both issues since the Legislature convened last month, property tax reform has taken a front seat early in the session. Last week, Abbott,  Patrick  and  Bonnen , joined by leaders on the issue in the statehouse, put forth  identical property tax reform bills that they said would help ease the burden of booming property taxes across the state. The Senate bill - SB 2 - was heard in committee Wednesday where interested parties debated its merit for 13 hours before pushing a vote on the bill to next week. The House bill has been filed and awaits committee consideration. 

Click here to watch the full State of the State address. Click here for a transcript of the speech. 
Local officials line up to oppose property tax reform measure

Officials from cities and counties across the state appeared in Austin this week to oppose a measure touted by the state's top elected leaders that would limit the amount of money local officials can generate from property tax revenue. 

The governor, lieutenant governor, and speaker of the Texas House have united on the issue and thrown their full support behind the pair of reform bills in the Legislature. However, Wednesday's hearing in a Senate committee painted a different picture, as  local officials from across the state lined up to express their opposition to Senate Bill 2, which would mandate a 2.5 percent revenue cap for school districts and local governments. 

Local leaders urged members of the five-member Senate panel on property taxes to consider that their cities and counties are growing at a pace faster than 2.5 percent, expressing concern about their ability to pay for public safety and other services under such a cap. Under SB 2, which is identical to House Bill 2, in order to exceed the cap, the elected officials will have to seek voter approval. Currently, that tax cap is set at 8 percent for local governments.

Despite the opposition testimony extending well into Wednesday evening, committee members appeared to mostly support the measure, with some arguing the local officials should be more deferential to their constituents when it comes to raising more funding from property taxes. 

"Sometimes local elected officials don't know what voters want, and that's why we should take it to them," said Sen. Kelly Hancock (R-North Richland Hills).

In an exchange with  Dallas Chief Financial Officer Elizabeth Reich, Hancock said the budget implications - a $32 million hit to Dallas' nearly $1.4 billion budget - would be " relatively small and something that can be dealt with." Yet, Reich was concerned that a shortfall could cost the city's police and fire budgets, which she said currently grows about 4 percent annually. 

On the other side, however, several homeowners lined up to testify in support of the bill. Some said their property tax bills had doubled over periods of six to 10 years.  Other homeowners expressed concern that the bill would not go into effect until 2020, stoking fears that local government officials could take in more revenue than usual this year as they wait for the new cap to be instituted. 

The committee hearing debate on the bill was created by Lt. Gov. Dan Patrick this session for the sole purpose of taking on property taxes, and the 2.5 percent rollback measure has emerged as Republican leadership's preferred vehicle for reform.  The committee is led by Sen. Paul Bettencourt (R-Houston), who has lead the Senate's property tax efforts in previous sessions. 

For now, the bill is pending in committee and is scheduled for another public hearing on Feb. 11 in Austin. Click here to access the bill's text and follow its progress. 
February 2019
FRI 15th - OCAs submission deadline
TUE 26th - Legislative Day
April 2019
FRI 26th - TBB Board meeting
May 2019
MON 27th - Last Day of 86th Legislature
June 2019
WED 5th - SAT 8th - Convention @ Jackson Hole, WY
August 2019
THU 22nd - OCA awards @ Georgetown, TX
FRI 23rd - Board meeting
November 2019
FRI 15th - Board meeting