Senate approval of SB 9
On Aug. 6, the Texas Senate approved Senate Bill 9, which would lower the cap on annual property tax growth for cities and counties with populations over 75,000. The proposed change would reduce the current limit from 3.5% to 2.5% and require voter approval for rates above that threshold.
The measure is part of Gov. Greg Abbott’s property tax relief agenda for the ongoing special legislative session, set to end Aug. 19. Abbott has criticized local governments for imposing what he calls excessive tax increases, pointing to Harris County’s 2024 hike and a proposed 24% increase in Austin as examples.
How it would work
The bill, filed by Sen. Paul Bettencourt, R-Houston, applies only to the maintenance and operations portion of a tax rate. It would not impact new construction added to tax rolls, and smaller jurisdictions under the 75,000-population threshold would be exempt.
Bettencourt said city and county property taxes are growing about 3 percent faster than those for school districts, with some areas including Austin seeing combined city and county bills exceed school taxes. He argued the change would encourage local governments to “tighten their belts” and could help attract businesses by keeping rates lower.
Support and opposition
Business groups such as the Texas Association of Business and the Texas Taxpayers and Research Association backed the measure, saying it could lead to more transparent budgeting and voter involvement. Supporters believe requiring more frequent tax elections would discourage unnecessary rate increases.
Opponents, including Hays County Judge Ruben Becerra and representatives from the Texas Conference of Urban Counties, warned against a “one size fits all” policy. They argued local governments, including the City of Austin, need flexibility to fund essential services and respond to community needs. City officials in Richardson estimated SB 9 could reduce their property tax collections by about $750,000 in fiscal year 2025-26, potentially affecting public safety and other priorities.
SB 9 now moves to the Texas House. However, the chamber has been unable to pass legislation due to a lack of quorum after more than 50 Democratic members left the state.
Separately, voters in November will decide on three constitutional amendments passed during the regular session to expand property tax exemptions, including higher homestead exemptions for all homeowners and additional relief for elderly and disabled residents.
