Do revenue caps provide tax relief?

Imposing a narrow statewide cap on city budgets will not provide homeowners and businesses with meaningful tax relief because it doesn’t address the real cause of high property taxes – the state’s failure to address school financing in a meaningful way. Property owners know that the highest portion of their property taxes goes to funding schools and only a small percentage actually goes to the City. In Sugar Land in 2016, school district taxes accounted for up to 65 percent of your tax bill while city taxes represented only about 15 percent. Restricting city property taxes may sound good, but it won’t lower your tax bill in a significant way.

In fact, had the City relied on the legislature to provide “tax relief” in 2016 through a 4 percent revenue cap rather than the City Council approved 2 percent increase to the Homestead Exemption, Sugar Land residents would have ended up paying $12 MORE on their tax bill in 2016.

Additionally, the City would have lost its flexibility to respond to economic conditions, and with that, its ability to keep taxes low. Sugar Land is different from every other city in Texas. State restrictions on cities have to be broad and flexible enough to take into account the vast differences between cities across the state.

Show All Answers

1. Do revenue caps provide tax relief?
2. Is it true that total City property tax collections are growing much faster than median household incomes?
3. Who should be making decisions on property tax relief, the City or the State?
4. What is the impact of revenue caps?
5. How much has Sugar Land’s tax rate increased over the years?
6. Do revenue caps impact highway construction?
7. How do revenue caps impact economic development?
8. Why doesn’t the legislature change school financing to provide tax relief?