Thursday, June 13, 1996

Home Owners Paying Bigger Share of School Taxes

By PEGGY FIKAC
Associated Press

AUSTIN - Homeowners are paying a growing share of school property taxes, according to a state report that comes out as a gubernatorial committee prepares to hear the public's thoughts on property tax relief.

There is "homeowner unrest about increased appraisals. It's widespread," Insurance Commissioner Elton Bomer, who heads the Citizens' Commission on Property Tax Relief, said Wednesday.

The first hearing by the panel, which was appointed by Gov. George W. Bush, is Friday in El Paso.
Public school property taxes in Texas rose more than 3 percent, to $9.3 billion, in fiscal year 1995, said the report from Comptroller John Sharp.

Residential property taxes made up 43.52 percent of the total, or $4 billion. Single-family homes accounted for most of that at $3.6 billion, or 38.72 percent of all school property taxes.

That's up from fiscal year 1994, when residential properties made up 42.29 percent of school taxes, or $3.8 billion; and single-family homes, 37.75 percent, or $3.4 billion.

Business property taxes make up a bigger portion of total school property taxes. In 1995, they added up to $4.5 billion, or 47.95 percent.

But that's down slightly from 1994, when business property taxes made up 48.95 percent of the total, or $4.4 billion.

Acreage, lots and personal property, such as vehicles, are counted separately.
Homeowners' share of school property taxes has been on the rise for years.

In fiscal year 1992, business property taxes made up 52.47 percent of the school tax total, while residential property taxes made up 37.72 percent.

Overall, this is the smallest percentage increase in school property taxes since fiscal year 1992, said Debbie Wheeler of the comptroller's property tax division.

The increase was 8.1 percent between 1991 and 1992; nearly 6.2 percent between 1992 and 1993; and 4 percent between 1993 and 1994. Ms. Wheeler said school districts' reasons for setting taxes at a particular rate would vary around the state.

As for the increase in the share of taxes paid by residential property owners, Ms. Wheeler said that's mostly due to increased values.

Single-family home values have gone up nearly 7 percent in Texas as more people move into the state, and low interest rates and high rents prompt interest in home ownership.

Bomer said he has received several letters from homeowners and that he expects to hear from them at public hearings.

He noted news reports about angry homeowners - such as those in Williamson County, north of Austin - who have received their latest appraisals and are upset with higher tax bills.

Bomer said he also expects to hear from businesses. They not only pay property taxes but are the focus of several of the alternative taxes that have been suggested to provide property tax relief.

A special task force that earlier studied property taxes has suggested three possible options to replace them: creating a business activity tax; imposing a gross receipts tax on all business and investment income; and making changes in the current 6.25 percent state sales tax, such as expanding it to items not now taxed.

Cities and counties also levy property taxes, but Bush has directed the special committee to focus on ways to replace the school property tax.