Lt. Gov. Dan Patrick held a press conference on May 6 to discuss property tax legislation.

This report is intended to give you an overview and highlight the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer.

Lieutenant Governor Dan Patrick

  • Not here to start or continue a fight with the Gov or Speaker, here to fight for 5.7m homeowners who would get less under Gov & house plan than Senate plan
  • Plan is the Senate plan, passed 31-0 in Regular, passed 30-0 last week, Sen. Bettencourt helped design it with the rest of the Senate
  • Ending all property taxes is a fantasy, don’t blame Governor; he’s either getting very bad info rom staff, or very bad info from outside
  • Speaker has been quiet, disappointed he is not here; similar to quorum break last session
  • When you sine die you have to get permission from the other body, we have not given permission; would like them to come back, there are some flaws in the smuggling bill
  • Senate continues to work & the House continues to stay home
  • Reviewing where we are, there is a difference between House & Senate plan and we’re not far apart, both have about $17.6b in property tax relief, this is set aside in budget
  • Difference is simple, House wants to take 100% of that and give it to everyone, businesses, those out of state, etc.; if you give it to everyone then homeowner tax cut is diluted
  • Senate plan is to give 70% to everyone, 30% specifically for homeowners
  • Texas House passed a homestead exemption towards the end of session, 147-0; what happened in the last 10-12 days? Why is the House now saying it’s not on the call? It doesn’t have to be on the call, Gov can’t prescribe how we write a bill
  • House rules state that a bill not within the call is passed and signed, it will become law
  • Governor could say he would not veto a bill with a homestead exemption in it; he hasn’t said he’s against the exemption, just that he’s for compression
  • Under Gov & House plan the average cut is about $740 and it isn’t permanent, Senate plan is between $500-$700/year more
  • Senate tax plan gives all homeowners another $500-$700 every year for the rest of the time they live in their home; savings total roughly $90b-$100b that Gov & House are refusing to give homeowners
  • They haven’t responded; everyone says we’re here to reduce property taxes
  • Dallas Morning News article stated Patrick’s proposal benefits taxpayers more, Houston Chronicle article says Lt. Gov. plan more directly benefits homeowners while Abbott plan benefits businesses more
  • Senate plan is a $100k exemption for all, compression benefits the highest priced properties more than others; Senate plan is the fairest to every homeowner & it is significant savings for homeowners
  • Was $15k, when I became Lt. Gov. we raised it to $40k, now want to raise it to $100k
  • Another Houston Chronicle editorial says Senate plan is the best for homeowners
  • Dallas Business Journal states Dan Patrick plan is better, not anti-business; businesses are getting 70% of the $17.6b
  • Text going out now to Senators saying Gov. Abbott wants to slash taxes 26% and eventually eliminate them; Senate plan slashes school property taxes 41%, homestead exemption gives bigger cut
  • Not blaming Governor, wasn’t involved in property tax fight during the session and getting bad info
  • LBB info adding up all local gov tax collections in 2024 will be $73.8b, $76.2b in 2025; every other tax state collected equals $72.4b; eliminating property taxes means that every dollar of budget would be spent, no funding for education, health care, or law enforcement
  • If you eliminate all property taxes you have no money left to do anything, this is a joke perpetrated by others, Gov. Abbott would not endorse this plan of spending every dollar on property taxes
  • Other way to do it is increase sales tax from 6 cents to 20 cents, this is not going anywhere in the legislature and people won’t approve it
  • This is a plan from someone who got 8% of the vote running against Gov. Abbott
  • This fight is over, people have spoken, facts are clear; Senate plan gives homesteaders $500-$700, Gov. Abbott plan gives then $740; difference is carving out 30% to give to homeowners
  • Cannot imagine Gov would veto a bill that is 70% compression and 30% for homestead exemption
  • For those in the House who voted for the homestead exemption, question is why they don’t support it now
  • #1 priority in the House was HB 5 which gives exemptions to businesses
  • If 2 of Speaker, Gov, Lt. Gov. are against one, the one usually loses, but not if the 2 support bad policy
  • 70% compression, 30% homestead exemption is negotiation that Senate is not backing down from
  • Senate bill does more for homeowners than Gov. and House plan; have been lowering property taxes since 2019, compression and local gov cap have brought taxes down, on the right path
  • Asking House to come back to work, Senate will be working
  • If Gov. agrees or disagrees, then invite Gov. Abbott to a Lincoln-Douglas style debate for eliminating property taxes long term and this bill specifically; will prove that the Senate plan is superior, will prove that we cannot eliminate property taxes, but will also prove we can work together
  • Up until this event we haven’t disagreed publicly, but last Tuesday when he tweeted the House plan was better, I had to respond, because it is not for homeowners, eliminating property taxes doesn’t make sense
  • Not arguing with Gov., but will not back down on this & open for debate

 

Questions

  • What mechanism could the House procedurally come back after sine die? If they don’t is the plan to run out the clock until the Gov. calls another special?
    • Lt. Gov. Patrick – Some in the House believe they come back, they haven’t officially adjourned sine die because we haven’t allowed them to
    • If they really want to come back, they’ll figure out a way; if they can’t the Speaker can ask for another special
    • Need to get it done because there is a time limit, constitutional amendment needs to be on the ballot
  • Wouldn’t it have been better to get the deal and then call you back?
    • You can’t get a deal if someone leaves
    • Too much riding on the $17.6b, all the Senate wants is to give homeowners a bigger exemption, but on the last day the Speaker said he was out of there & was sending everyone home
    • Asked Gov. to get him on the phone & he did the same thing on the grid the day before; told Gov. Abbott he would come back
    • When Speaker Phelan walked out on property taxes, gave him one more offer and he turned it down
    • Left two meetings in a huff and difficult to negotiate when they walk out
  • Are you going to stay the full 30 days?
    • We are at the point where we’ve done all the work the Gov asked us to do, will hang around until Thursday, come back Monday, and see where we are
  • Sen. Angela Paxton recusing?
    • Talking about property taxes, can’t say anything about the trial
  • Have you had any contact in the last week with Gov. Abbott?
    • Just staff
    • Media has figured out that the plan is terrible, House members have figured it out, Senators already knew
    • Agree with compression, just saying you can’t have it all
  • Factoring a 10% appraisal, you can have situations where bills are higher; is there a combination of caps and other factors?
    • Speaker has already jettisoned appraisal idea, didn’t fight for it
    • Businesses said they didn’t want caps
    • And he has finally figured out what we did in 2019 is working
  • When you say eliminating M&O is fantasy, do you mean in next 2 years?
    • You can never get there, one of the facets of the plan is to put 90% of all surplus into M&O
    • Can’t fund government on sales tax, economies turning down means revenues go down
    • Would need to do the $17.6b plan again next session, but that is not guaranteed
    • When you do compression, need to keep doing that every year; if you don’t do it one year, property taxes go through the roof
  • Or presumably another school finance plan?
    • Even in the future, we don’t even collect enough other revenue to cover the property taxes, you’re always behind
    • If you make incremental changes over time you can dramatically decrease property taxes or hold them level
  • You mentioned time is of the essence, do you also feel time is of the essence to free the $5b in the budget so ISDs can do their budgets and deal with school choice in September
    • That’s a whole other issue, part of why it’s important to get this done now
    • Would like to see many other bills on the call, like Ten Commandments, putting prayer time back in schools, bail reform, judicial recall, etc.
    • Sent the House 14 election bills, 12 of the died
    • And have a trial to deal with
    • This was not the time for the House to leave
    • Don’t know why the House didn’t pass homestead exemption, they passed it unanimously a week ago
  • Do you know what the state of HB 30 is?
    • That is a whole long story
  • Will you sign it?
    • That will take care of itself
  • When will it go to the Governor?
    • While I was negotiating that last day with Gov. & Speaker, didn’t know there was a deal between House & Senate that if we passed HB 30 they would pass a Senate bill, don’t recall what bill
    • I wasn’t on the podium & they killed our bill
    • So they made deal, we passed their bill, and they killed ours
    • Stuck bill on the podium and it has been there for last 5 days
  • You are going to sign it eventually?
    • Let’s just say it’s been done