What you should know about Proposition 4

Voters will have the opportunity to vote on Texas Proposition 4.

This proposition will change the Property Tax affecting the State Education Funding Amendment on the ballot in Texas as a legislatively referred constitutional amendment on November 7, 2023.

According to Ballotpedia: A “yes” vote supports amending the state constitution to: - increase the homestead tax exemption from $40,000 to $100,000; - authorize the state legislature to limit the annual appraisal increase on non-homestead real property; - exclude appropriations made to increase state education funding from the state appropriations limit; and - authorize the state legislature to provide for four-year terms for members of the governing body of an appraisal entity in counties with a population of 75,000 or more.

A “no” vote opposes this constitutional amendment to increase the homestead property tax exemption; authorize the state legislature to limit the annual appraisal of non-homestead real property; and exclude increased state education funding from the appropriations limit.

When voters go to the polls a vote yes for “Proposition 4 would increase the homestead tax exemption by raising it from $40,000 to $100,000. This proposed change would take effect for the tax year commencing on January 1, 2023.

The amendment authorizes the state legislature to limit the annual appraisal increase for non-homestead real properties.

This limitation would be contingent upon the lesser of the property’s recent market value as evaluated by the appraisal entity or 120% (or a potentially higher percentage) of the previous tax year’s appraised value.

The amendment enables the state legislature to introduce laws outlining supplementary eligibility prerequisites for this appraised value limitation, which would be effective either upon the law’s enactment or from January 1 following the initial year of property ownership, depending on the later date. This subsection of the amendment would expire on December 31, 2026.”

This is not the first time a homestead exemption pass in Texas. Since 1997 there has been one before.

“In May 2022, Texas voters approved an an amendment to increase the homestead exemption from $25,000 to $40,000. In 2015, Texas voters approved Proposition 1, which increased the homestead exemption from $15,000 to $25,000. Prior to that, Texas voters had last increased the exemption in 1997 with the passage of Proposition 1, which increased the homestead exemption from $5,000 to $15,000. They were all approved with at least 84% of the vote.”

It should be noted that “the amendment requires that the state legislature must incorporate a reduction in the limitation on property taxes for elderly or disabled homeowners with homesteads.

This reduction would equate to $15,000 multiplied by the 2022 tax rate designated for general elementary and secondary public-school objectives.

Commencing from the 2023 tax year, if there are changes in the general school district residence homestead exemption for various categories of residents, the legislature must implement reductions in the limitation amount for those homesteads subject to the prior year’s limitation.

“The reduction should be proportional to the changed exemption and the applicable tax rate for public school purposes. Proposition 4 would authorize the state legislature to enact laws concerning the governing board of an appraisal entity in counties with populations exceeding 75,000. The amendment would exclude state tax revenue appropriations for ad valorem tax payments from the constitutional appropriations limit.”

According to the same information on Ballotpedia the proposition came about “after the state legislature did not pass a property tax amendment during the 2023 regular legislative session. Gov. Greg Abbott (R) called for a special session on May 29 to address property taxes.

Nine amendments were proposed but none were passed. Gov. Abbot called for a second special legislative session on June 27 where Proposition 4 was introduced as House Joint Resolution 2 on July 10, 2023.

It passed in the House by a vote of 132-5 with 13 absent on July 13. HJR 2 passed in the Senate on the same day by a vote of 31-0.

After the vote, Gov. Greg Abbott (R) said, “The Texas House and Senate fulfilled our promise with an agreement that delivers a comprehensive, long-lasting solution to increasingly burdensome property tax bills. I thank my partners in the Texas Legislature for coming together to honor the best interests of hardworking Texans who want to own their property—not rent it from the government.”

The Texas State Teachers Association opposes the information saying “Proposition 4 because it is anti-education, is unnecessary and, if adopted, will remove a constitutional source of future dedicated funding for public schools. The ballot caption is misleading. Here it is: ‘The constitutional amendment prohibiting the imposition of an individual income tax, including a tax on an individual’s share of partnership and unincorporated association income.’” “In truth, the state constitution already has a provision, the so-called “Bullock amendment” adopted in 1993, to prohibit the Legislature from imposing a personal income tax without voter approval. That provision already protects taxpayers, and it also includes a requirement of major importance to public schools. If Texas voters ever were to become convinced that an income tax were necessary, the Bullock amendment provides that at least two-thirds of net revenue collected from the tax would be dedicated to reducing school property tax rates and the remainder to education funding. If Proposition 4 passes, it will wipe out the dedication to education and property tax relief.”

At the Lunch and Learn on Wednesday Judge Travis Ransom, who did not take a side one way or the other because of his position as judge, talked about the impact that Proposition 4 would have on the County.

He encouraged that everyone would take a look at all of the propositions including this one to decide what was best for Texas and Cass County.

Ransom was also at the meeting to give information and answer questions on the County Assistant District coming up for a vote in November. Zack Baldwin with Americans for Prosperity who was also part of the program encouraged the area to vote for the proposition.