Round Rock and Georgetown could see tighter limits on property tax growth under a bill the Texas Senate approved Aug. 6. Senate Bill 9 targets cities and counties with populations above 75,000, lowering the cap on certain tax rate increases and requiring voter approval for higher amounts.
How the bill works
Authored by Sen. Paul Bettencourt, R-Houston, SB 9 would drop the annual cap on maintenance and operations property tax revenue growth from 3.5% to 2.5%. Any rate set above that threshold would have to be approved by voters.
The proposal would not apply to revenue from new construction, nor to local governments below the 75,000-population mark.
Gov. Greg Abbott has made property tax relief a priority for the current special legislative session, pointing to tax hikes such as Harris County’s 2024 increase and a proposed 24% rate jump in Austin as examples of the problem.
Supporters say it controls costs
Bettencourt argued that local property taxes have been rising faster than school district taxes in many areas, sometimes surpassing them. Business groups such as the Texas Association of Business back the measure, saying it could encourage growth by reducing tax burdens.
Jennifer Rabb of the Texas Taxpayers and Research Association told lawmakers the bill would make tax rate changes more transparent by sending them to the ballot more often.
Critics warn of lost flexibility
Opponents say the measure could limit cities’ ability to fund key services. Hays County Judge Ruben Becerra called the one-size-fits-all approach too restrictive, and Adam Haynes of the Texas Conference of Urban Counties said local governments need more leeway in high-cost years.
Advocates for public services, including Shannon Halbrook of Every Texan, noted that cities such as Round Rock and Georgetown rely on property tax revenue to meet community needs.
In Richardson, officials said a similar revenue cap could cost them about $750,000 in the upcoming fiscal year, representing a significant share of their budget.
Next steps
The bill heads to the Texas House, but action is stalled by a lack of quorum. In November, voters statewide will also consider three constitutional amendments designed to provide additional property tax relief, including increased homestead exemptions for school district taxes.
