Young County Republicans Chair Kyle Milam: The Tax Man Cometh
The first quarter of the year is the time of year when personal taxes come to the forefront as we face the deadline to file and await the pain of paying more to Uncle Sam or the glee of a refund. But aside from federal taxes, the Texas legislature is in session, and I can tell you that a priority of this session from the Governor, Lt. Governor and Speaker of the House is to bring relief to property taxes and to reform school finance.
School finance and the method of funding for school districts is antiquated. Just talk to your local administrator, and you will discover that the funding mechanism that has been in place 20 years looks like a Rube Goldberg flow chart. Funding from the state is based on average daily attendance, but how the average is calculated it is not an actual average, it’s just called an average daily attendance. Then there are the other myriads of hoops to jump through to qualify for funding for specific educational programs.
Additionally, the State has been incrementally reducing the amount of funding to the schools to an amount that is now only 38 percent of the total funding. So local property taxes have been incrementally increasing to make up the difference. Property owners are bearing most of the cost to fund education. Rural counties like Young County are hit the hardest because we do not have the property tax base like urban, metroplex counties that can provide funding for new classrooms and teacher pay well above the state minimum.
But it is the rising property taxes in the big cities that are finally driving the legislature to find a fix. Property valuations in the metroplexes have increased to the point that homeowners, especially retired ones, cannot afford to pay taxes year after year and are having to sell their home. Now that we have a Republican Governor, Lt. Governor, Speaker of the House and majorities in both the House and Senate you can expect that there is going to be a change.
Committees in both chambers, as well as the finance committee, have been working on this agenda since the last biennial session ended. Knowing who is on these committees tells me that the legislature is more than serious and I believe Governor Abbott will keep the legislature in session until a bill has passed that he will sign. What is being proposed is some combination of a reduction in property taxes, increasing the homestead exemption and expanding sales taxes while increasing the state funding from the current 38 percent. How much these change will depend on what the legislators can pass. But I for one am ready for anything that brings relief to property owners. It is not a fair system. One property brings in revenue that offsets the tax while another property is idle and you are paying rent to the government for the privilege of owning it. I am for more skin in the game, and it is time to get the onus off the backs of ownership. Yes, expanding sales tax will cause some double dipping for property owners, but it will bring more of someone else’s share into the system.
Aside from the tax angle, the legislature will be reforming the mechanism of funding school districts which may be the most important endeavor. The peril for Young County though will be how they address the small rural school districts versus the Dallas and Houston schools. The complexity of the finance system leaves us with little knowledge of what to support. The devil is always in the details, and you can bet that rural administrators are tuned in on how that is moving through committee hearings. What Young County is facing now and will continue to face is the power and needs of the largely populated counties. Much that applies to Harris County or Dallas County hamstrings our county because we do not have the tax base to cover additional expenses in unfunded mandates. That is why I continually advocate our rep and senator that their needs to be population caps where the mandate or legislation does not apply to a county with less than say 250,000 or whatever number makes sense for that bill.
From a Republican Party standpoint, please know that while we are electing Republican candidates across the state, my impetus is to advocate those we are choosing at the state level the needs of Young County for whatever will improve our lives, whether that pertains to county government or our school systems.