Lawmaker Proposes Using a Portion of Texas’ $27 Billion Surplus for Property-Tax Relief

Texas Lt. Governor Dan Patrick speaks at a press conference on the border wall at the state Capitol in Austin, Texas, on June 16, 2021. (Mei Zhong/The Epoch Times)

The state of Texas is sitting on a hefty $27 billion surplus.

Lt. Gov. Dan Patrick on Wednesday laid out a list of priorities he would like lawmakers to consider in the next budget. Patrick, a Republican who resides over the state Senate, emphasized that it would be up to the members, but he believes the top priority should be cutting property taxes.

“We need a robust property tax cut for everyone in the state, and we have a chance,” he told reporters on Wednesday during a press conference. “That should be a focal point of this.”

Patrick said he would like to see the state’s homestead exemption increase from $40,000 to at least $60,000, possibly $65,000. In May, Texas voters elected to raise the homestead exemption from $25,000 to $40,000.

The Texas Constitution limits how much money can be added to any two-year budget cycle. The amount is determined by the Texas Legislative Budget Board, based on the rate of the state’s economic growth. On Wednesday, they adopted a 12.3 percent estimated economic growth rate for the 2024-25 budget, which means lawmakers will be able to add about $12.5 billion of the surplus to the next budget.

“So, we have to be smart about not only about what we reserve, and I call it our checking account—all this money—but also smart about our rainy day fund,” Patrick explained.

“ … We have a lot of money, but we can’t spend everything like normal, so we have to stay in the constitution limits because we do have restrictions on what we can spend and actually restrictions on what we can save, so it’s a great chance to do a lot of great things,” he continued.

Proposed Relief for Homeowners

Gov. Greg Abbott said he also wants to cut property taxes for homeowners.

“Texas is sitting on a record budget surplus of $27 billion… Because this is your money, I want to return at least half of that money to you with the largest property tax cut ever in the history of Texas, “ he wrote on Twitter in August.

But giving property owners half of the $27 billion would bust the spending cap, Patrick explained.

“For me, personally, busting the spending cap, I think, sets a very dangerous precedent,” he told reporters. “Once you’ve done it, it’s easy to do it again.” Adding that he’s “not in favor of busting the spending cap.”

His proposal to increase the homestead exemption would be “something we can maintain,” and it would be “significant savings people can see.” The cost of the proposed homestead exemption increase is estimated to cost the state about $2 to $2.5 billion.

Among his list of top priorities, Patrick also proposed expanding the personal property tax exemption for small businesses, firming up the grid with natural gas generation, creating a rural law enforcement fund to assist underfunded counties, and mandating a minimum 10-year sentence for any crime committed with a gun.

Lawmakers have an ”extraordinary opportunity unlike we’ve never had before in the state of Texas and to create a vision.”