House passes Abbott-backed property tax relief, adjourns special session

AUSTIN (Nexstar) — On the first full day of the first special legislative session, the House passed the two bills Gov. Greg Abbott called on lawmakers to pass, allowing for the Speaker to adjourn indefinitely Tuesday evening after the Senate passed conflicting legislation.

In a dramatic 24 hour span, House and Senate lawmakers completed the regular session late Monday evening after hours of failed negotiations on a property tax relief deal that stalled both chambers from gaveling out for the session. Less than three hours after the 88th Legislative Session concluded, Abbott called them back to the Capitol with demands for property tax relief and border security bills.

Senators passed a property tax plan quickly that included steps to expand the state's homestead exemption, the amount of a home's value that is exempt from property taxes. The Senate then recessed until Friday.

Hours later, the House Speaker Dade Phelan said House lawmakers would not take up the Senate bill, saying it was not germane to the governor's special session call.

Speaker Phelan's move marked a climax in the impasse, sending a message to his Senate counterpart to take up the House's proposal or go back to the drawing board for a second special session. By adjourning sine die, Phelan gave the Senate two options — pass the House's versions of the bills or pass nothing, since House members cannot meet for the rest of the special session after adjourning.

A staffer for the Speaker told Nexstar that their office ran the property tax relief plan by the governor first before passing it and adjourning. Additionally, the governor sent out a statement in support of the House bill after the lower chamber adjourned.

“It provides more cuts to property tax rates than any other proposal at this time," Abbott said in a press release. "It is supported by the most respected tax think tank in the state, as well as more than 30 homeowner, consumer, and business groups across the state. I look forward to signing it when it reaches my desk.”

The House bill would use $12.3 billion of available Texas dollars to reduce property taxes, by "compression." It was the language Abbott specifically used in his call for a special session, and would in essence give more money to school districts on the agreement that districts lower property tax rates.

Senate's property tax proposal

Earlier Tuesday, the Senate passed two different property tax pieces, SB 1 and SJR 1, which would provide 10 cents of property tax compression and a $100,000 homestead exemption for homeowners under the age of 65 and $10,000 more for homeowners older than 65 if voters ultimately approve it.

“I have been committed to fighting back against the wave of ever-increasing property taxes since before I held elected office. The combination of a substantial homestead exemption and property tax compression is a very powerful way to deliver serious property tax relief," Lieutenant Governor Dan Patrick said in a press release. "I have been crystal-clear that taxpayers deserve to receive the largest property tax cut in Texas history, and SB 1 delivers on that promise sustainably and responsibly.”

The House version does not propose expanding the homestead exemption, which had been a sticking point for Patrick throughout negotiations. At an earlier event Tuesday, the president of the Senate doubled down on his belief that his plan will provide the most savings to Texas homeowners.

Patrick will have to adopt the House property tax bill without any changes or do nothing, which will likely trigger another special session in order to heed the governor's calls. Before all of this went down, Patrick indicated no intention of backing down from what he views as the best path toward tax relief.

"I will not step back from this. And I might be the last guy standing. But I'll be the last guy standing. Homeowners in this state deserve real property tax cuts — and that's a combination of compression and homestead exemptions," Patrick said at the event.

Nexstar reached out to the lieutenant governor's office for comment and will update this story if we receive a response.