Turner proposes lower tax rate to help stay under revenue cap
The Turner administration is proposing a nominal property tax rate cut — its fifth in six years — to stay under the voter-approved revenue cap.
The proposed rate is 56.18 cents per $100 of assessed value. That is down slightly fromthe existing rate of 56.79 cents per $100 of assessed value. The difference represents about $10 in property tax on a $200,000 home with a standard homestead exemption.
While the rate is lower, property owners still could see higher tax bills because of rising appraisals. The city says the lower rate will bring in an additional $11 million in property tax revenue from the previous year.
A public hearing and City Council vote on the rate has been
scheduled for next Wednesday.
This year, the city also must operate under another revenue cap passed last year by the Texas Legislature. That package set a cap of 3.5 percent in added revenue from year to year. Cities seeking to go above the state cap must get approval from voters.
However, that cap allows for some flexibility during disaster declarations, which applies to Houston during the COVID-19 crisis. Houston is using that flexibility to set a higher rate than it otherwise could.
District B Councilmember Amy Peck opposes the proposed rate and said the city should decrease it to the 3.5 percent level— 54.45 cents per $100 — to help residents struggling during the economic downturn brought on by the pandemic.
“People are hurting, landlords are trying to keep people in their homes, and that extra money — I think it’s just our opportunity to ease that burden during this disaster,” Peck said.
Mayor Sylvester Turner stressed that the city is proposing to lower the rate. He argued Houston operates on a tight budget already and needs revenue amid a downturn in sales tax collections due to the pandemic.
Mayor Pro Tem Dave Martin said the difference between the rate Peck favors and the city’s proposed rate is relatively small. For a homeworth $196,400, Martin said it marks the difference between paying $1,069 or $1,103 in taxes — a $34 gap. His calculation did not include the standard 20 percent homestead exemption.
“For $34, I’m in favor of doing this because my area andmy district will receive a lot more value for the $34 they spend on much needed (flood) remediation projects,” Martin said.