On Jan. 31, Gov. Greg Abbott, Lt. Gov. Dan Patrick and Speaker of the House Dennis Bonnen introduced legislation intended to curb property tax growth by restricting the ability of local governments to increase their revenue without voter approval.

The proposal calls for a public vote if any local taxing entity—such as a school district, community college district, city or county—increases its revenue by more than 2.5 percent year-over-year. Those caps are often called “rollback rates” because if exceeded, they trigger an election in which voters can limit, or roll back, the tax increase.

Many local government entities said the proposed changes would cripple their ability to adequately provide services. On Feb. 4, the Austin Community College board of trustees added the community college district to the list of institutions to oppose the proposed law changes.

The board voted unanimously to oppose any legislation that impinges upon its “ability and authority to sufficiently fund its programs and serve its students.”

In September, the board approved its annual budget, increasing the community college district’s tax rate to fund the remaining debt issued after ACC district voters passed a taxpayer-funded bond in 2014, in turn raising ACC’s tax bill for the median homeowner from $318.81 to $352.51.

If the board had passed that budget under the rules laid out in the proposed legislation, a rollback election would automatically be triggered.

Neil Vickers, ACC’s executive vice president of finance and administration, said the district would have taken a $9 million hit in revenue if it were to meet the 2.5 percent cap in the previous budget cycle.

Vickers said if the legislation were to pass, ACC staff would have discussions about how to proceed, but if the entire revenue gap were to fall on tuition payments, students would see a significant increase.

“[The proposal] saves the average taxpayer in Austin about $15 a year, but it would impact our average student about $12 per hour to offset the savings to the taxpayer,” Vickers said.

Students living within the community college taxing district pay $67 per credit hour.

  • The rollback rate discussion was not the only item the board considered related to the Legislature. After initially deciding in its Dec. 3 meeting to support a change to the education code that would allow ACC to do away with run-off elections, the board backed off that position and did not include the item among its legislative priorities.

  • In its next budget cycle, the board may look to strengthen a tool that can help seniors and the disabled with property tax relief. The homestead exemption for seniors 65 and older and the disabled is $160,000. However, the board can only increase that exemption by $10,000 each year and it is not keeping up with rising property values. Board members asked Vickers to come back with an analysis of options to lift the cap or institute a tax freeze. If the board decides to make changes, Vickers said it must notify the local tax appraisal districts by June 30.