Community colleges depend upon the property tax as a source of revenue, along with tuition and fees, and state appropriations. If state appropriations are not adequate to fulfill the instructional mission of the school—and trustees are understandably reluctant to increase fees on students—the property tax can be raised or allowed to rise with assessed property values, if they are increasing. Unless property rates are capped. It’s complicated.
Please have a look at Matt Reed’s thoughtful piece on the property tax, in Inside Higher Ed. One difference that will jump out at you between Dr. Reed’s state and Texas, is that we don’t have a personal income tax down here. And convincing Texans to adopt an income tax is like convincing Aggies to root for Longhorns. Not gonna happen.
But the absence of an income tax inevitably places pressure on other sources of revenue. Property taxes in Texas are high, as many new residents from other states are discovering these days. This is the season when homeowners receive assessments, and some are outraged over the increased value in a so-called seller’s market. Take, for instance, the DFW suburbs or, for that matter, anywhere along the I-35 corridor. The real estate bubble of 2008 is apparently a distant memory, here in (as Gore Vidal put it) the United States of Amnesia.
The largest property tax bill is always for the public schools, but the Texas Legislature dials down state appropriations when ISDs collect additional revenue, placing school boards and superintendents in a tight spot. Community college districts are at the low end, but that doesn’t stop home and business owners from noticing when values rise, pushing all taxes upward.
Seniors often get a break, whether they need it or not. But that’s another topic for another time.
As Dr. Reed notes, there are advantages to owning a home, most especially the deduction of mortgage interest for federal income tax purposes. This policy benefits upper-income individuals with large mortgages. Renters don’t have this advantage, but rent certainly goes up when a landlord’s taxes rise.
The property tax was created long ago, when property was the closest approximation to wealth available at the time. Agriculture and ranching are often exempted from the tax, or at least reduced greatly. You may have noticed that those who live “out in the country” often raise a few animals—some have called such horses or cattle “lawn ornaments.”
Avoiding taxes should be in our national anthem instead of those bombs bursting in air. Our flag could be a picture of a lawyer with a brief case, talking on a cell phone. Go avoiders!