Senate Local Government Panel to Measure Homestead-Exemption Gains, Probe Appraisal District Budgets

The Texas Senate Committee on Local Government will gavel in at 1 p.m. Sept. 1 to hear invited testimony on two interim charges: what a decade of rising homestead exemptions has actually done to Texas school tax bills, and how county appraisal districts set and pay for their own budgets. The panel is taking invited witnesses only — there is no public testimony slot and the Senate runs no online comment portal — but anyone filing written testimony must supply 20 copies to the committee clerk and email a digital copy, according to a revised hearing notice that lists the charges as numbers 1 and 3.

Sen. Paul Bettencourt, R–Houston, chairs the seven-member committee — four Republicans and three Democrats — with Sen. Bryan Hughes, R–Mineola, as vice chair, according to Texas Legislature Online. Bettencourt wrote most of the legislation now up for review, which makes this less a fact-finding exercise than an audit of his own decade of work: property taxes are levied entirely by local governments in Texas, and school districts collected nearly half of the $81.4 billion in property taxes raised statewide in fiscal 2023, according to comptroller data compiled by Ballotpedia.

The first charge, Examining the Effect of Increasing the Homestead Exemption, walks members through six bills across six legislatures. Senate Bill 1 in 2015 took the school exemption from $15,000 to $25,000; Senate Bill 2 in 2019 rewrote the rate-setting rules; Senate Bill 1 of the 87th Legislature’s third called session and Senate Bill 2 of the 88th Legislature’s second called session carried it to $40,000 and then $100,000. Last session’s Senate Bill 4 and Senate Bill 23 finished the job. The committee is asked to identify the share of Texas homeowners who, as a result, no longer pay any school property tax at all — a figure the state has never published.

Both 2025 bills required constitutional amendments, and voters ratified them decisively on Nov. 4. Proposition 13, lifting the general school exemption from $100,000 to $140,000, passed 79.4 percent to 20.6 percent. Proposition 11, raising the additional exemption for homeowners 65 and older or with disabilities from $10,000 to $60,000 — a $200,000 total — passed 77.7 percent to 22.3 percent. Neither bill drew a dissenting vote in the Senate; SB 4 cleared the chamber 31-0 and the House 143-0. The relief began reaching bills this summer, and The Texas Dispatch reported in July that appraised values cooled as the larger exemptions landed — the first time since the pandemic run-up that some homeowners saw values fall.

The second charge, Ensuring Transparency in Appraisal District Funding, is the quieter of the two and possibly the more consequential. Members are directed to study the governance, budgeting authority and cost allocation practices of county appraisal districts, to examine the fiscal impact of those costs on taxing entities, and to evaluate whether additional guardrails are warranted. Under Section 6.06 of the Tax Code, a chief appraiser proposes the district budget and each participating taxing unit is billed a share based on its portion of the levies collected — an arrangement that leaves cities, counties and school districts paying a bill they do not vote on.

Appraisal district accountability has been a live subject all year. The Dispatch reported that filing opened in July for the elected appraisal district board seats created for counties of 75,000 or more, and separately that a Tarrant Appraisal District reappraisal freeze that overvalued roughly 190,000 homes is headed to the November ballot. Whether the committee treats those as isolated failures or as evidence of a structural problem will determine how far the recommendations reach.

Because this is an interim hearing, the committee will take no votes and no legislation is before it. Testimony will shape the panel’s interim report and the property tax bills filed for the 90th Legislature, which convenes in January 2027. A related Senate Finance sitting set for Sept. 2 is posted as canceled on the chamber’s upcoming-meetings calendar.

Meeting at a glance

Committee members

• Sen. Paul Bettencourt, R–Houston (SD-7) — Chair
• Sen. Bryan Hughes, R–Mineola (SD-1) — Vice Chair
• Sen. Molly Cook, D–Houston (SD-15)
• Sen. Roland Gutierrez, D–San Antonio (SD-19)
• Sen. Phil King, R–Weatherford (SD-10)
• Sen. Angela Paxton, R–McKinney (SD-8)
• Sen. Royce West, D–Dallas (SD-23)