A push by Texas lawmakers to curb city and county property tax bills died quietly Thursday morning after legislators clocked out of a 30-day legislative sprint without reaching a deal — leaving homeowners, county officials, and city leaders in limbo on one of the state’s hottest political issues.
Gov. Greg Abbott had called the special session in hopes of pushing through another round of property tax relief. But despite weeks of negotiations, competing proposals, and backroom talks, lawmakers left Austin without passing a bill — a reminder of how deeply divided Republicans remain over how far to go in restraining local governments.
The failure capped a contentious standoff between the House and Senate that ultimately ended in deadlock.
The Governor’s Push
Abbott, who has made property tax relief a signature priority, told lawmakers to use the 30-day special session to tackle local government spending. His pitch was straightforward: while the Legislature had already approved massive cuts to school district property taxes earlier this year, homeowners and businesses were still being squeezed by city and county tax bills.
The governor framed local governments as the obstacle standing between Texans and true property tax relief. “We must ensure that when the state cuts school property taxes, local governments don’t turn around and erase those savings,” Abbott said earlier in the summer.
His allies, especially fiscal conservatives in the Senate, saw the session as a chance to finish what they started in 2019, when lawmakers first imposed a 3.5% cap on how much more property tax revenue cities and counties could collect each year without seeking voter approval.
Senate Bill 10: The Centerpiece of the Debate
The key battleground was Senate Bill 10, authored by Sen. Paul Bettencourt, a Houston Republican known in the Capitol as the state’s leading “tax man.”
Under current law, cities and counties cannot raise more than 3.5% in additional property tax revenue from existing properties without first asking voters to sign off. SB 10 proposed lowering that cap further to 2.5% — but only for larger jurisdictions with at least 75,000 residents. Smaller counties and towns would still follow the current 3.5% threshold.
Supporters said this approach made sense. Elections are costly, they argued, and in small towns the expense of holding one might eat up the very revenue increase under debate. Limiting the new rule to bigger jurisdictions, they said, would focus the law where it mattered most — in Texas’ growing cities and suburbs where tax bills have risen fastest.
But opponents in the House, particularly members of the hard-right faction, bristled at the idea.
House Republicans Rebel
The House stripped down the Senate’s proposal and rewrote it dramatically. Representatives lowered the cap to just 1%, a far tighter leash on local governments than either Abbott or Bettencourt had initially floated. They also removed the population carve-out, meaning the stricter rule would apply to every city and county, from Houston and Dallas down to small rural towns.
On top of that, they exempted spending on public safety — a politically charged category that makes up the largest portion of many city and county budgets. Their argument: no one wants to tie the hands of local police and fire departments.
The changes were sweeping. And when Senate and House negotiators tried to hammer out a compromise, the differences proved too wide.
The Breakdown
By Tuesday night, the measure was effectively doomed. The final House vote — 60–71 against the negotiated bill — showcased bipartisan opposition. Many Republicans joined Democrats to kill it, albeit for different reasons.
Rep. Mitch Little, a Republican from Lewisville, said the compromise did too little. “This is not the solution to our problems,” he declared. “This is not the answer to our prayers.”
Rep. Steve Toth, a hardliner from Conroe, went further: “Bull. Bull crap. It’s not even a start,” he thundered on the House floor.
Meanwhile, Democrats like Rep. Vince Perez of El Paso argued the plan disproportionately benefited urban, Democratic-leaning cities, leaving rural and suburban Republican areas with little relief. “It is the Democratic cities that will see the largest benefit in this bill, not the Republican ones,” Perez said.
In the end, the coalition of skeptics — Republicans who thought the bill was too weak, Democrats who thought it was unfair — proved fatal.
Senate Frustration
Sen. Bettencourt was quick to blame the House. In a statement after the vote, he called the rejection “unanticipated and disappointing” and accused House members of blocking relief for “tens of millions of Texas taxpayers.”
The Senate, he argued, could not agree to the House’s sweeping changes, especially the unlimited exemption for public safety spending. From his perspective, that would have opened the door to endless property tax hikes under the guise of funding police and fire.
What’s at Stake for Homeowners
For most Texans, the breakdown may feel like inside baseball. But the outcome matters because property taxes are the largest source of funding for local governments — and often the biggest complaint from homeowners.
A typical property tax bill in Texas has three main parts:
School district taxes (the largest portion, already targeted by this year’s earlier legislative cuts).
City taxes.
County taxes.
School tax bills are expected to shrink thanks to $51 billion the state has dedicated over the next two years. But without limits on city and county revenue growth, lawmakers fear those savings could be swallowed by increases at the local level.
That’s the political backdrop that drove Abbott to call the special session. Yet now, those concerns remain unresolved.
Cities and Counties Push Back
Local officials have long warned against tighter caps, arguing they threaten their ability to fund basic services — especially as inflation drives up costs for fuel, construction, salaries, and health insurance.
Mayors and county judges often argue that the state keeps ordering them to do more with less. For example, expanding law enforcement presence on the border, responding to natural disasters, or funding emergency medical services. “We can’t pave roads, pay deputies, or staff EMS on a 1% growth limit,” one rural county judge testified during hearings.
Public safety costs alone often grow faster than the state’s caps allow. That’s why the House tried to carve them out, but the Senate viewed that as a loophole too big to close.
Political Fallout
The collapse raises questions about how much political appetite remains for another showdown. Abbott has not said whether he will call lawmakers back for yet another special session, though his office has not ruled it out.
Republican leaders may have to settle for the record-setting $51 billion in school tax relief already passed this year. While that money ensures substantial savings for homeowners, it doesn’t fully answer the governor’s broader goal of permanently constraining local governments.
Some conservatives, however, say they won’t let the issue drop. Rep. Tony Tinderholt of Arlington and Rep. Nate Schatzline of Fort Worth — both vocal in the debate — were seen huddling with Bettencourt after the bill’s defeat. That suggests more maneuvering may be ahead.
A Familiar Pattern
If the fight feels familiar, it’s because it is. Texas lawmakers have struggled for decades to untangle the knot of property taxes, local control, and school funding. Each session brings new promises of relief, and each session ends with many Texans still frustrated by their bills.
The 2019 law capping local revenue growth at 3.5% was hailed as a breakthrough, but critics say cities and counties have adapted around it. Lawmakers hoped SB 10 would take another bite out of the problem. Instead, the fight exposed the deep rift between those who want incremental change and those demanding sweeping reform.
That divide has grown sharper as Texas politics itself has shifted further right.
What Texans Can Expect Now
For the near future, homeowners will still see savings from the Legislature’s earlier moves this year. School property tax rates are being bought down by the state using surplus revenue, and a new $100,000 homestead exemption will soon shield more of a home’s value from taxation.
But city and county portions of tax bills are unlikely to shrink. In some fast-growing communities, they may continue to rise — fueling more political pressure at the local and state level.
That means the property tax fight in Texas is far from over. Whether lawmakers return to Austin this year, next year, or after the 2026 elections, the question of how much control the state should exert over local government spending will remain one of the Capitol’s most enduring and divisive battles.
Bottom Line
The special session ended with no new law, no compromise, and no immediate path forward. For Abbott, Bettencourt, and fiscal conservatives, the failure is a setback. For cities and counties, it’s a reprieve — at least for now.
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