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Property taxes continue to be a point of contention for Texas residents following a new report that found almost all independent school districts (ISDs) rose faster than the preferred rate of growth this year.
A report from the Texas Public Policy Foundation (TPPF) last month found that Houston ISD's property tax grew 12.2% — $2 billion to $2.2 billion from 2016 to 2020. The combined population and inflation for the city grew by 5.3% during that time, resulting in a difference of 7%.
"If left unchallenged, these value increases have the potential to really take a bite out of taxpayers over the long haul,” TPPF’s policy director, James Quintero, said in a newsletter discussing property tax appraisals and how to protest them. “Taxpayers should be prepared to defend their wallets this year—first by protesting their property tax appraisals and then by pressuring their local elected officials to adopt lower tax rates.”
According to TPPF's "Just the Facts; Property Taxes in Texas' Most Populous Cities, Counties and School Districts", second edition, by Quintero and Anthony Jones, published in February 2022, property taxes in Texas are unique in a number of ways. Besides being the largest tax assessed in Texas, the state's property tax is surrounded by laws and systems that make it notoriously complicated. In 2019, nearly 50% of all tax dollars collected in Texas came from property taxes, and there were 4,256 separate property taxing units in Texas in the fiscal year of 2019, some of which overlap.
"It’s not a stretch to say that property taxes are out of control in the Lone Star State. As a result, local governments are getting rich while families are forced to make hard decisions," Quintero said.
Earlier this year, The Balance ranked Texas 10th in its list of the top 10 states with the highest property tax rates in the United States with a median payment of $4,065 per year, while the Tax Foundation reported that last year, Texas had the sixth-highest property tax rate measured as property taxes paid as a percentage of owner-occupied housing value in 2019.
In 2019, the 86th Texas Legislature passed House Bill 3 (2019), which now requires school districts to conduct efficiency audits before a district seeks voter approval for increasing tax rates, according to TPPF. Katy ISD and Conroe ISD were the only two school districts in the state that kept their property tax growth rate below the preferred rate of growth.