By Riki Markowitz
Every two years we talk about the importance of keeping an eye on the current legislative session. This year, however, will be an interesting one to watch following the recent midterm elections. Senators in the 86th legislative session, according to those who follow Texas politics, are shifting their focus back to “bread and butter issues.” With a new speaker in the House and gains in progressive representatives in both chambers, lawmakers are eager to get back to working on property tax reform, school finance reform, and emergency management planning and relief. Notably, these are all issues that the Texas Association of REALTORS (TAR), the Austin Board of REALTORS (ABoR), and the Texas Association of Builders (TAB) say are some of their most pressing legislative priorities as well.
TAR, the state-level advocacy group for real estate professionals, announced that 89 percent of REALTOR-supported candidates won their races this past Election Day. Then, on the first day of pre-filing in Texas, more than 400 bills had been submitted to the calendar clerk by lunchtime. So keeping tabs on every legislator or every bill that affects real estate consumers is not the best use of anyone’s time. Instead, sign up for notifications from your local REALTOR advocacy association so you can keep up with the lawmakers who are working to make Texas a great place for doing business, especially for real estate professionals.
In the meantime, here are some of the issues that your advocacy organizations are watching:
Property Tax Reform
In 2017, at the end of the 85th legislative session, Gov. Greg Abbott called a special session for the purpose of passing property tax reform. But the session abruptly closed out even though there were still 27 hours available for arguments and negotiations. According to The Texas Tribune, it was a disappointing end for Abbott’s No. 1 issue. Property tax reform is on the agenda again this year and chances of passing a bill that favors real estate consumers are better.
The issue received heightened visibility when Senate committees were charged with studying property tax reform during the interim. Texas REALTORS want to see discussions continue from where they left off in 2017 – “enhanced taxpayer notifications and the elimination of a petition requirement on the rollback tax rate, which will improve public education about appraisals and the process to set tax rates,” says Jaime Lee, TAR’s governmental affairs communications manager.
One reason a property tax reform bill keeps dying on the floor is because no one can agree on how to make up for reducing taxes. When you lower taxes in one area, those funds need to be collected from somewhere else. That could mean implementing a new tax, raising taxes or diverting money from another area. No one wants to take responsibility for any of these options.
A positive way to look at the Senate’s inability to pass a property tax bill in the past is that it’s not uncommon for an issue to circulate through two or more legislative sessions before a bill hits the governor’s desk. Of course, it’s preferable to get property tax reform done now and not in the 2020s.
School Finance Reform
School finance goes hand-in-hand with property tax laws and will be affected by any new property tax bills. But it’s also an issue that real estate consumers have a specific interest in. One of the first conversations that homebuyers have with their real estate agent is school district funding.
Texas has the sixth highest property taxes in the country and the state clearly relies on those funds. Property owners, however, loathe this tax. Especially in counties like Travis and Williamson where property values have been on an upward trajectory with no end in sight. So regardless of whether homeowners are seeing their incomes increasing, their cost of living continues to rise. For some it’s a financial burden; for others it’s downright devastating. Added to that, the state is sending fewer and fewer dollars to public schools even though student enrollment goes up every year. Local taxpayers are billed the difference, but that money can also be diverted to other districts – or to something entirely different.
Hurricane Harvey – and emergency management, in general – is one issue that everyone agrees will take up a lot of time on the House floor this session. In 2017, Lt. Gov. Dan Patrick released to Senate committees a list of nearly three dozen interim charges related to Hurricane Harvey ahead of the 86th legislative session. Past House Speaker Joe Straus asked the public education committee, house appropriations and natural resources committees to look at the costs and suggest ways to react to future storms. These solutions will impact school district operations, allocation of federal funds and development and maintenance of flood prevention infrastructure. “We expect a lot of legislation and protections,” says Lee. “The mechanisms needed to protect Texans are moving forward.”
How you can help
There are a few things that agents and brokers can do to help advance the industry’s legislative agenda. First, join your local real estate associations and sign up for email notifications from ABoR, TAR and Williamson Country Association of REALTORS. Getting email updates will keep you in the loop on important legislative issues.
Another way to help is by getting to know local and state legislators. Fortunately, there’s a really easy way to do this. Just show up to REALTOR rally days, organized by real estate advocacy organizations.
March 20 is Rally Day at the Texas State Capitol, a free, biannual event organized by Texas Association of Builders. Starting at 10 a.m., you have the chance to meet legislators and top policy staff members. There will be a keynote speaker, legislator meet-and-greets and a reception. The same day is the 2019 HBA Lunch at Scholz Garten. Go to HBAAustin.com/event/tab-rally-day/ for more information.
REALTOR Day at the Texas Capitol, organized by the Texas Association of REALTORS, is on March 26. There will be an open house and lunch at the Texas REALTORS building on San Jacinto Boulevard. Go to https://www.texasrealestate.com/members/events for more information.
By showing up to meet legislators, you can become a better advocate for your industry and clients and help to advance important agenda items. RL