City Council approved the ordinance through a 6-0 vote during its June 21 meeting, and the action comes after the council voted to approve the first reading during its June 6 meeting. Mayor Robin Elackatt was not in attendance.
“Regardless of whether that amount is one penny or whether that amount is $100,000, any tax relief for our citizens is something I believe is extremely warranted, and if we’re able to do it based on all the scenarios I know I’ve looked at—we have a healthy fund balance, our sales taxes are increasing and we’re really going to be in a good place over the next several years per the forecast—today is a good day to slow walk ourselves into this and know we’re making the right decision,” Mayor Pro Tem Jeffrey Boney said during the meeting.
The forecast Boney referenced was an economic forecast from TXP Inc., an Austin-based economic analysis and public policy consulting firm that the city hired. According to a June 21 presentation to City Council by the firm, Missouri City is expected to see continued sales tax revenue increases through 2027.
The timing of the vote comes as homestead exemptions, which remove part of a home's value from taxation, are allowed under the Texas tax code but must be adopted before July 1.
That means that using an average home value of $269,128, a 2.5% homestead exemption would reduce Missouri City’s property tax revenue by approximately $680,000 while saving the average homeowner about $40 on their property tax bill, according to city documents. That exemption would apply to nearly 17,000 homesteads.
With the approval, the ordinance increases the exemption homeowners age 65 and older from $15,000 to $25,000. That would result in an additional loss of property tax revenue of $382,833 for the city at an annual savings of $144.51 for residents age 65 and older, according to agenda documents.
The second reading of the ordinance differs from the first by increasing the exemption available to disabled residents by $10,000. The first reading had maintained what the city had been offering.
According to Council Member Floyd Emery, who motioned to amend the first reading with the added disability exemption, the negative impact on the budget with his proposal is about $795,000.
“We’ve talked a lot about our 65 and older, but let’s not lose sight of the fact that these disabled residents need a break as well,” Council Member Lynn Clouser said.
Council Member Monica Riley, who wanted to add additional exemptions for residents age 65 and older beyond Emery’s proposal and provide greater support for the senior community, motioned two separate times for a $30,000 exemption for that age group, one motion with a 0% homestead exemption and the second with a 2.5% homestead exemption. Both motions failed to pass.
“My concern is that I would like to see the senior exemption be $30,000 so that those senior residents can see the impact of saving $173 a year versus $20,000 with savings of $120 to $130,” Riley said.
As she did during City Council’s June 6 meeting, Council Member Vashaundra Edwards expressed concerns about moving too quickly on approving the tax exemptions and a desire to better engage with residents about the ordinance before approving it.
“I still feel as if we are rushing this,” Edwards said. “I understand the deadline, but if this was something that was a hot topic, it should’ve been brought to us at the beginning of the year.”
