Over the past couple of years, San Antonio property values took a dramatic upswing. In turn, the Stone Oak lifestyle ended up costing a little bit more for homeowners in the form of increased property taxes. The Governor and the Texas legislature both approved SB2 in their latest session. That means that property tax reform is officially on its way in Texas.
Property Tax Reform Approved in Texas
Why Did We Need the Reform?
Previously, the City of San Antonio could increase property taxes as much as 8% each year. When property values jump as much as they have in the recent past, that puts a significant burden on a Stone Oak homeowner. Officials didn't even need voter approval for the increase either. With the governor making a property tax cap one of his top priorities, several suggestions were bandied about in the legislature. Some suggested a 4-5% cap. Others proposed a one-cent sales tax increase. Finally, they came to a consensus with a 2.5% cap on school tax and a 3.5% cap on local government taxes.
What Happens Under the New Property Tax Bill?
Beginning next year, the 2.5% school and 3.5% local government caps go into affect. If local districts decide that they need to increase taxes more than that, it triggers an automatic vote for taxpayers to decide. In the past, the government increase property taxes up to 8% without voter approval. Even then, voter approval wasn't needed.
Typically, local governments allocate property taxes as follows:
- School District = 40-60%
- City & County = 10-25%
- Colleges/Special Jurisdictions = remaining percentage
Now, local government must cap increases at 3.5%, with no more than 2.5% going to the school district. So, the City received $100,000,000 in tax revenue for the current year, they can't collect more than $103,500,000 the following year. That sets the next baseline at $103,500,000 for the year after that.
If you have any questions about the new Texas property tax bill SB20, please contact the Bexar County Tax Assessor's office.
LUX Move Up* by Christine Aldrete Banks, CRS, SRS, RSPS