Over the past five years, 85-year-old Cypress resident Don Hurt has seen a 37.4% increase in his property value, according to Harris Central Appraisal District documents.

Hurt said he is primarily living off his Social Security income after losing his wife a decade ago, but higher property appraisals mean more burdensome tax bills.

“The big concern now is, ‘Am I going to live longer than my money will last?’” he said.

The overview

Hurt is among thousands of Cy-Fair residents facing property tax spikes due to rising home values as more than 95% of homeowners countywide saw sizable property value increases in 2022 and 2023.

But relief is on the way as Texas lawmakers approved a plan this summer that Lt. Gov. Dan Patrick said would save the average homeowner $1,250-$1,450 on their 2023 tax bill.

What you need to know

Despite entities such as Cy-Fair ISD lowering property tax rates in recent years, property appraisal increases have resulted in higher tax bills for local homeowners.

State legislators approved a plan to address property tax increases in mid-July, closing out the second special session of the year.

“If passed by voters this fall, Texas homestead exemptions [for school district taxes] will rise to $100,000, senior homeowners will be protected from being priced out of their home, the small-business exemption for the franchise tax will double and Texas small businesses will be protected from excessive appraisal increases,” Gov. Greg Abbott said in an Aug. 9 news release after signing off on the plan.

The $18 billion package includes two bills—Senate Bills 2 and 3—and a constitutional amendment. For the tax cuts to show up on this year’s tax bill, Texans must approve the constitutional amendment, Proposition 4, in November. Homeowners would also need to apply to receive the homestead exemption.

This tax relief comes after back-to-back years of what Harris Central Appraisal District officials called “unprecedented” property value increases. The average homeowner saw 23.3% and 17.3% market value increases in 2022 and 2023, respectively, following 8.9% and 10.4% increases in 2020 and 2021, respectively.What else?

If Proposition 4 passes, the homestead exemption will be raised, and homeowners will pay reduced taxes to their local school districts.

• ISD tax rates will decrease by 10.7 cents.
• The state will distribute $12.7 billion to schools.
• For a $300,000 home, decreasing the school district tax rate by 10.7 cents would cut an average tax bill by $321.

The plan also includes a nonhomestead appraisal cap, which would limit annual value increases for certain properties if Proposition 4 passes.

• The value of property worth $5 million or less cannot increase by more than 20% year over year.
• This applies to all nonhomestead property, such as second homes and commercial property.
• Approximately 13 million properties will qualify.

As part of the new law, SB 3 also amends the state business franchise tax, which all businesses currently pay based on individual circumstances.

• Businesses that make less than $2.47 million annually will no longer have to pay the tax.
• Roughly 67,000 small and midsize businesses will be exempt from the tax.
• Collectively, qualifying business owners will save around $300,000 each year.

While lawmakers widely supported the legislation, some in opposition fought for relief for renters. State Sen. Paul Bettencourt, R-Houston, argued that landlords who receive tax relief would pass the savings on to renters, but Dick Lavine, a senior fiscal analyst for the progressive advocacy group Every Texan, said the legislation does “nothing for [renters] at all.”

Why it matters

Property values are continuing to spike due to pandemic-era economic conditions.

Stephen Mulin, who has lived in his Towne Lake home for about 11 years, said his property value has jumped from the mid-$300,000s to the low-$500,000s in the last few years. While he said he’s had success protesting his market value in recent years, he said the HCAD did not lower his appraised value—the taxable amount that determines his tax bill.

This has been a trend across homes in Cy-Fair.



What they’re saying

• “We must balance the needs of government with the limits of a taxpayer’s wallet.” –State Sen. Lois Kolkhorst, R-Brenham
• “The signing of this Texas-sized tax cut, the biggest property tax cut in history, is a massive victory for all 5.7 million Texas homeowners.” –Lt. Gov. Dan Patrick
• “Forty percent of the people of this state rent. They lease from a landlord. They often live month to month on their salaries. ... We are in a time of great abundance, yet we are specifically leaving out 40% of this state.” –State Rep. Gene Wu, D-Houston

What’s next

After the legislation was approved, three Democratic state representatives, including Ron Reynolds, D-Missouri City, of the Houston area, released a statement condemning Republicans for providing more tax relief to certain groups.

“Texas Democrats fought hard for the millions of Texans who rent, who are teachers or who send their children to public schools, but they were entirely neglected in the process by Republican leadership,” the statement says.

While school districts will receive state funds to offset lower property tax revenue, overall school funding will not change. Lawmakers are expected to return to the Capitol this fall to discuss school funding, Patrick said.