Paul Bettencourt is one of those rare government employees who is willing to say that in doing his job, he is actually not working in the best interests of the public he is supposed to serve. 

During the last several weeks one of the most important issues facing the Texas Legislature has been the issue of property taxation.  Because Texas has no state income tax, property taxes play a greater role in government finance than they might.  However, this does not alter the fact that a great many people in the Lone Star State are quite upset at having to pay, in come cases, as much as 4% per year of assessed valuation on their homes.  The impact of this tax rate might be best understood by the fact that in some instances the amount of taxes paid each year exceeds the amount paid on the home mortgage.  Or, in figures presented in the Wall Street Journal, and cited on a legislative advocacy web site sponsored by the Texas Assn. of Realtors.  The site compares three homes valued at the same amount, located in Florida, Indiana and Houston, Texas.  The Texas home was by far the largest, but was also assessed a much higher amount of property tax.  It is an obstacle to “the American Dream of home ownership” that should not exist in a state, which prides itself on being the home of rugged individuals who can take care of themselves.   

Texas property taxes are, administratively speaking, a nightmare.  The state is divided up into a myriad of different districts covering cities, schools, utility districts, emergency service districts, hospitals, and a wide variety of other causes.  The districts overlap, so that it is virtually impossible to determine what the tax rate on a home will be without examining the county title records for the property in question.  Several months ago while examining this issue I attempted to locate a map or chart showing tax rates across the state.  An excellent illustration may be found in the in Window on State Government web site, which shows, inter alia, that Harris County, where Houston is located, contained well over 300 different tax districts in 2002.  The number has probably gone up since then.  Bexar County, home of San Antonio has nowhere near as many, nor does Dallas County.  Fort Bend County, to the southwest of Houston, which is a rapidly growing area seems to be following Harris County’s example by creating numerous tax districts of its own, although not as many so far. The situation becomes even more complicated for citizens of some areas with possibly unique geographic characteristics.  Take, for example, the town of Katy, west of Houston.  Katy covers parts of three counties, leading to widely divergent tax rates, depending on the part of town in which you might live.  Worse yet, in order to file a homeowner's exemption form the resident must do so in two counties, because if their home is located in Harris County, the exemption filed in that county does apply to Waller county where the Katy Independent School District is headquartered.  Ditto for Fort Bend County.   The real issue however is not revamping the districting system, but rather, the school funding.  The lion's share of property taxes paid anywhere in Texas always go to the local school districts.  Matters were brought to a head during 2005 when the State Supreme Court declared the school funding program unconstitutional, forcing the state legislature to act.  In 2005 the regular legislative session plus two special sessions plus three special sessions in 2004 failed to produce a solution to the problem.  Of course, the citizens were unhappy with the lack of progress, but they were even more unhappy with existing the tax rates.  Enter the unlikely duo of local radio personality Dan Patrick and Harris County Tax Assessor Paul Bettencourt.  
Dan Patrick, is probably a household name to many evangelical Christians as the author of The Second Most Important Book You Will Ever Read.  He became major voice in Harris County politics when Paul Bettencourt began appearing on his radio program several years ago to address the issue of property taxes. Bettencourt, whose job it is to assess and collect the Harris County property tax is one of those rare government employees who is willing to say that in doing his job, he is actually not working in the best interests of the public he is supposed to serve.  He became an activist supporting the lowering of property taxes state wide, and helped to organize a voter convoy to Austin to convince the state legislature to take action.  The activists were delayed, eventually prevented from presenting their case, and nothing happened.  This led Patrick toward his decision to run for State Senate.   In the March 2006 State Primary, he was a landslide winner, as were several other candidates who took an anti-tax position. 

They are not alone.  Two current candidates for the Katy Texas School Board have adopted similar positions.  Both have questioned why the schools are so expensive to operate, but have shown progressively decreased academic rankings during the last ten years.  One candidate questioned why the district spends $7 million more per school than other nearby districts and suggested that they shouldn't be trying to win awards for architects.  Another suggested that the school district needed to balance its budget and stop issuing "fluff bonds", noting that the district population had increased 88 percent since 1995, but its debt has increased by 500% over the same period.  

Meanwhile, during  the April-May 2006 Special Session, the Texas Legislature has sent a bill to Governor Perry purportedly to lower property taxes, and replace them, in part with a business tax.  This is essentially the bill supported by the Texas Assn. of Realtors.  Tax Collector Bettencourt doesn't agree with them.  His web site provides a brief but concise analysis, indicating that the bill would decrease property taxes on the average by $15, but in some areas actually increase them.  In his role as tax collector, he sees it proper to fully inform taxpayers of what is going on with their money in the State Capital.  So far it appears to have had little impact on the legislature, and it may be that new officials must be elected to achieve action.    

This brings us back to Dan Patrick who has issued a pact with the State of Texas to lower the annual appraisal cap to 3% on residential property, reduce government spending, put tax cuts ahead of government pensions, and also to secure the borders.  It is likely that if he were to get his way there would be a reduction in the amount the amount that schools and other districts can collect, given that the amount of spending has been racing ahead of needs, and the State has generated a approximately $8 billion surplus.  Some Democratic legislators are unhappy even with the proposal that the Realtors Assn. has supported.  Their criticism is linked to the idea that future needs must be funded by higher taxes today, and that there should be no decrease in school taxes to compensate for the increased business tax.  In short, they want to raise taxes despite public pressure to do the opposite.   All this seems to do is indicate that they can't accept the idea of keeping government expenses down. 

Mr. Patrick has another critique of the problem.  Without a cap on appraisals, and/or a reduction in rates, the relief granted in 2006 would evaporate in as little as two years.  In 1978 California Voters used their initiative process to enact Proposition 13, officially titled the "People's Initiative to Limit Property Taxation." Its passage resulted in a cap on property tax rates in the state, and reduced them by an average of 57%.  During the months leading up to the election fear mongers touted dire effects if so much as one penny in revenue was lost.  Vital services would have to be cut.  Police and fire protection would be non-existent.  They were, of course, wrong.  Texas doesn't have a ballot initiative process.  There can't be an outright voter revolt as in California.  Instead, Texans must elect officials to do the job for them.  Perhaps with the election of Dan Patrick and others like him, they will get the job done, and help usher in an era of government downsizing, instead of the continual growth that has characterized so much of government for so long. 

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Note:  With apologies to Piers Anthony, I must admit that the title of this piece was inspired, in part, by what I consider the finest literary pun ever penned.  "Crewel Lye – A Caustic Yarn" is the title of one of his Xanth novels, which I must have read some twenty years ago and which still has me grinning whenever I think of it.