Gov. Abbott calls legislators back for a second special session to tackle property tax relief

Texas Gov. Greg Abbott (R) called for a second Special Session Tuesday, once again ordering state lawmakers back to Austin to work together to bring property tax relief to millions of Texans.

The governor's first special session included two agenda items, property tax relief and harsher penalties for smugglers, neither of which passed both chambers or made it to the governor's desk.

The House and Senate each passed property tax relief bills in the first special, but were deadlocked all month after the House gaveled out of the session on May 29, leaving their plan in the hands of the Senate and never returning to hear the other chamber's proposal. The Senate, meanwhile, continued working to pass its own bills but took no action on the House's bill.

As the first 30-day special session quietly came to a close Tuesday, the governor immediately called for a second to begin at 3 p.m.

"I am bringing the Texas Legislature back for Special Session #2 to provide lasting property tax cuts for Texans," Abbott said in a statement Tuesday. "The Special Session #1 agenda was limited to the only solution that both chambers agreed on — school property tax rate cuts. After yet another month without the House and Senate sending a bill to my desk to cut property taxes, I am once again putting the agreed upon school district property tax rate cuts on the special session agenda."

Abbott is again asking lawmakers to focus on only two agenda items, but this time both of those items are related to property tax -- the governor wants lawmakers to create a pathway to eliminating the school district M&O taxes (not all property taxes) and to use compression to reduce the school district property tax rate.

The governor's latest proclamation made no mention of providing additional relief through the expansion of the homestead exemption, a sticking point for the Senate.

Abbott said the House and Senate both agreed during the regular session to cut school district property tax rates, while the House wanted to add appraisal caps and the Senate advocated for increased homestead exemptions.

Lt. Gov. Dan Patrick, who leads the Texas Senate, said the plan put forth by House Speaker Dade Phelan in the first special session takes money out of the pockets of the average homeowner and gives it to big businesses and the wealthiest Texans.

Patrick said in June that the Senate's plan to lower property taxes uses both compression of the school M&O tax, where the state pays school districts the difference between the compressed rate and the old rate, and also includes increasing the homestead exemption to $100,000. The House plan does not include any additional homestead exemption and spreads the $17.6 billion of allocated relief across both residential and commercial property owners.

In a statement following Abbott'ss call for a new special session, Patrick said the Senate would continue to support cutting the tax rate through compression.

“Regarding the call to pass legislation to eliminate school property taxes all together, to do so would require increasing the sales tax dramatically, which clearly has no support from the legislature or the people. The only other pathway is using current sales tax dollars, which can never be achieved. The Governor mentions that cutting the tax rate is a lasting tax cut. It is not. As soon as sales tax flattens or declines in any year, property tax rates would skyrocket. The only tax cut that is lasting is a homestead exemption, which is locked into the Texas Constitution."

Patrick said earlier this month he wouldn't advance a property tax bill that didn't include an increase in the homestead exemption and that even though it wasn't on the first special's agenda, he thought the governor would still sign it if it ended up on his desk.

Meanwhile, Abbott reiterated previous statements to call session after session to deal with property tax relief until it gets passed by both chambers.

"Unless and until the House and Senate agree on a different proposal to provide property tax cuts, I will continue to call for lasting property tax cuts through rate reductions and working toward eliminating the school property tax in Texas," Abbott said in a statement Tuesday.