Despite his obsession with criticizing California, Texas Gov. Greg Abbott’s most recent property tax proposal sure sounds a lot like the Golden State’s Proposition 13 – the infamous 1978 constitutional amendment that capped property taxes and disrupted the state’s housing market, making homeownership unattainable for millions of California families today.
Property tax affordability is a real problem in Texas for low- and middle-income families. By almost every measure – per capita property tax, property tax as percentage of personal income, and others – Texas ranks among the highest in the nation. But the state has fallen short time and time again in addressing this for Texans who need it most, and instead focuses on expensive, broad tax cuts that benefit wealthy homeowners and do nothing for the nearly 38 percent of Texans who rent. The governor’s latest proposal would be another huge step in that wrong direction.
This California-inspired property tax proposal would make many changes to Texas property taxes. The centerpiece would reduce how much property tax assessments can increase in a year from 10 to 3 percent while expanding that cap to all properties, including businesses. Even more egregiously, Gov. Abbott is also pushing to allow voters to eliminate school property taxes for homeowners. These cuts will primarily benefit wealthy homeowners and businesses with little help for less-wealthy homeowners or renters.
As in California, Gov. Abbott’s proposal would require two-thirds approval from voters on all property tax increases. In California, this policy has given massive tax cuts to long-term owners at the expense of new buyers, who have to contend with higher home values. Doing this in Texas would make the state much more expensive for young families with children.
Unlike in California, Gov. Abbott’s plan would limit local spending growth to a formula based on population and inflation or 3.5 percent a year, whichever is lower. This would limit the ability for localities to manage crises and would serve fast-growing localities poorly. That provision is similar to Massachusetts’ Prop 2 ½, which has, counterintuitively, incentivized slow-growth or shrinking municipalities to raise taxes every year to make sure that they don’t end up stuck in a situation where they need a bigger increase and the law prevents them from imposing it.
Abbott’s plan would also allow voters to submit petitions to roll back property tax rates through referendums. This enables anti-tax voters and special interest groups to force citizens to vote on rollbacks for municipalities or school tax elimination. These provisions encourage eliminating funding for essential local government services. Many voters understand how crucial schools, roads, trash collection, and safe water are, and even in Florida, where anti-tax sentiments are strong, voters have approved local property tax increases over 200 times since 2010 – mostly to pay teachers and increase school funding. And as the failed 2025 property tax referendum in Austin shows, voters don’t need new laws to reject increases – they already have that ability.
One of the quietest and most harmful parts of the proposal would reduce the frequency of appraisals from every year to every five years. This would raise everyone’s taxes more substantially every five years instead of more gradually over time – which in turn makes people angrier about property taxes, enabling further cuts and restrictions. It doesn’t match shifts in the property market and forces people with properties that gain value slowly to subsidize owners whose properties are gaining value quickly. Best practices for assessors encourage regular reassessment to minimize these disparities and avoid distortions.
These policies would inevitably create an unfair housing market, encouraging long-term owners to hold onto properties and making it hard for new families to buy a home. The proposal would do little to protect low-income renters from rent increases. And as we’ve seen in California, it would give a huge windfall to business properties (which turn over less often) at the expense of new homeowners.
Gov. Abbott’s proposal is the most extreme and would harm the state the most. But expensive and untargeted property tax cuts seem to be a priority of many state lawmakers.
For example, Texas Lt. Gov. Dan Patrick recently released his own property tax proposal which would increase the state’s homestead exemption from the first $140,000 to $180,000 of home value, with seniors and Texans with disabilities receiving an additional $60,000 exemption. The threshold for the senior exemption and senior freeze on school property taxes would be lowered from 65 to 55 years of age. While his proposal is not as radical as Gov. Abbott’s, it would still be extremely expensive while targeting little-to-no relief to low-income homeowners and renters.
In recent years, Texas has passed changes similar to Lt. Gov. Patrick’s proposal, using state dollars to backfill the lost revenue for school districts. This was easy for the state to do while it ran large surpluses, but state revenue collections are slowing, meaning any property tax cut would likely eventually be paid for with cuts to public services or increases in sales taxes.
Fortunately, there is an alternative proposal to these damaging property tax proposals: circuit breakers. Property tax circuit breakers, which as of 2023 are offered in 29 states and D.C., can be used to “break” the circuit when a property tax bill exceeds a certain percentage of a household’s annual income. Typically to qualify, a home’s assessed value and the household’s annual income must be under a certain threshold. When a qualifying household receives a property tax bill that exceeds a percentage of their income, the excess tax payment is credited back to them, often up to a cap. Many circuit breaker programs are extended to renters as well, and even states like New Hampshire that do not levy a state income tax still administer an income-based property tax circuit breaker.
Gov. Greg Abbott and Texas lawmakers brand their state as pro-family, but his proposal would prioritize wealthy, tenured homeowners over young and growing families who are working to afford their first home – just as Prop 13 did in California. This proposal would disrupt the state’s housing market and jeopardize local revenues while doing very little to help workers and families struggling to pay their property tax bills.
