Propositions could increase exemption

Two state propositions on the May 7 ballot could mean a break for taxpayers in the Port Aransas Independent School District without any backlash for the district, according to sources.

Proposition 1, also known as Senate Joint Resolution (S.J.R.) 2 would, if approved, authorize the legislature to reduce the amount of a limitation on the total amount of ad valorem taxes that may be imposed for general public school purposes on the residence homestead of a person who is elderly or disabled.

The League of Women Voters, a non-partisan grassroots organization, presented the following explanation for what Proposition 1 means: “The Texas Constitution puts a ceiling on school property taxes paid by homeowners who are disabled or at least 65 years old. This means that for disabled and elderly homeowners, certain property tax rates cannot be higher than what they were the year they first qualified for this exemption. Since school property taxes make up most of a homeowner’s tax bill, their property tax bills are essentially frozen unless improvements are made to their residence or they move. In 2019, the Texas State Legislature passed a law which provided a property tax reduction to many homeowners. However, this reduction did not apply to disabled or elderly homeowners because under the Texas Constitution, their tax rate is frozen. Proposition 1 would amend the Constitution to allow disabled and elderly homeowners to receive the benefits from the 2019 property tax reduction that other homeowners received. This amendment would result in freezing their tax rate at a lower rate. This will allow all homeowners to benefit from the lower tax rates passed in 2019. The law related to this proposed amendment requires that the state reimburse school districts for revenues lost due to this proposition.”

Proposition 2 (S.J.R. No. 2) would increase the amount of the residence homestead exemption from ad valorem taxation for public school purposes.

What this means, according to the LWV, is that, “Currently, homeowners are able to reduce the market value of their primary residence by $25,000 when calculating their annual school property taxes. The proposed amendment would increase the amount of that reduction to $40,000. This could lower homeowners’ annual property tax bills. The law related to this proposed amendment requires that the state reimburse school districts for revenues lost due to this proposition.”

How would this affect Port Aransas ISD, a Chapter 41 district that sends more than 75 percent of every tax dollar it collects to the state for redistribution to poor school districts in compliance with a state law known as Robin Hood?

“The word is, it should not hurt the bottom line,” said PAISD Superintendent Sharon McKinney.

“The state is supposed to make up the difference, but it’s not a huge amount for us,” she said.

“Right now, the state provides a $25,000 homestead exemption. If the propositions pass, that exemption will increase to $40,000. We (PAISD) take another 20 percent exemption off, so people should homestead their properties,” McKinney said.

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