Gov. Greg Abbott proposes devoting $15 billion to property tax cuts in budget plan
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Gov. Greg Abbott wants lawmakers to spend $15 billion to lower Texans’ property taxes and at least $750 million on school safety measures such as security and expanding mental health services, while continuing to fully fund his border safety operation, according to his 2024-25 budget proposal distributed Thursday.
“To build the Texas of tomorrow, we must continue the State’s unrelenting efforts to build infrastructure, grow the energy sector, improve job training and public education, and ensure healthcare access — all while keeping Texans safe and preserving the freedoms we enjoy today for future generations,” the Republican governor wrote in the 25-page document, first reported by the Quorum Report.
The proposal lays out, for the first time, how Abbott wants lawmakers to deliver property tax cuts — an idea agreed upon by Republicans in both chambers even as details vary among plans.
Abbott proposes maintaining existing cuts to school property taxes made under a massive school finance package passed in 2019 and using state dollars to further reduce taxes under that law. The state doesn’t actually raise property taxes — that money is collected by cities, counties, school districts and other local entities — but by funneling more state money into schools, it’s able to lower the amount that schools collect. The cuts would apply both to homes and businesses.
He also asks lawmakers to consider expanding broadband access, supporting alternatives to abortion, creating family leave for state employees, investing in flood mitigation and other large infrastructure projects, paying down some of the state’s unfunded pension liabilities for state employees, and giving raises for teachers both active and retired.
Abbott also includes a new proposal to enhance death benefits for Texas National Guard members who have been stationed along the border as part of his multibillion-dollar security mission Operation Lone Star.
The document also calls for expanding postpartum Medicaid benefits to 12 months, addressing staffing and funding shortages in nursing homes, and buying harm-reduction drugs for law enforcement officers to carry to battle the fentanyl crisis. He proposes funding reform at the embattled Texas Department of Family and Protective Services, and supporting child abuse investigators and kinship care programs for children removed from their parents’ homes.
As with Abbott’s budget proposals in previous sessions, the document is short on specifics. It doesn’t lay out funding totals statewide or for each state agency, and it doesn’t give details for how to balance the cost of the ideas he’s proposing with other spending requirements or limits on state spending. Most of the specific budgeting work will fall to House and Senate lawmakers, though Abbott wields veto power over the final product and has the ability to shoot down specific line items.
The governor’s budget outline is required by the Texas Constitution to be delivered to lawmakers before his biennial State of the State address.
Each initially proposed $130.1 billion in general-revenue spending for the 2024-25 biennium, leaving at least $50 billion of available money unallocated in the early drafts.
That includes a historic $32.7 billion budget surplus attributed to record-breaking tax collections in the last 18 months.
“Our mighty Texas economy has produced another record — we now have the largest budget surplus in the history of our state,” Abbott wrote in the proposal. “But make no mistake, that money does not belong to the government. It belongs to the taxpayers.”
Lawmakers are required to pass a balanced budget before the end of the session. The new budget is typically approved near the end of May.
Abbott’s proposals for the next biennium largely mirror priorities he described Thursday evening during his State of the State address, delivered at Noveon Magnetics in San Marcos.
In his Thursday speech, he named seven emergency items that lawmakers can vote on immediately: cutting property taxes, ending COVID-19 restrictions “forever,” expanding school choice, making schools safer, ending “revolving-door” bail policies, securing the state’s border with Mexico and cracking down on fentanyl.
The budget document was distributed Thursday and addressed to House Speaker Dade Phelan, Lt. Gov. Dan Patrick and members of the 88th Legislature. The document had not been posted on Abbott’s website as of Friday morning.
Reducing property taxes
The $15 billion Abbott wants to spend on property tax cuts is in line with the amount already laid out in spending proposals in the House and Senate, and his previous statements about spending at least half the surplus on those cuts.
“We must — and we will — do more to provide meaningful tax relief to homeowners and businesses across the state,” Abbott said in the document. “Thankfully, a robustly growing economy and the extraordinary revenue surplus in the state’s budget has afforded us the opportunity to do so.”
Absent from Abbott’s budget proposal is any mention of an increase in the state’s homestead exemption on school district taxes, or the dollar amount of a home’s value that can’t be taxed. Raising the exemption is a top priority for Patrick, who has called for using $3 billion to raise the exemption from $40,000 to $70,000. But doing so would benefit only homeowners, critics have noted — which means more of the burden of paying property taxes would fall on renters and businesses.
But Abbott and Patrick appear aligned on the idea of cutting property taxes businesses pay on “personal property” like furniture and equipment — with Abbott expressing support for “targeted relief” for businesses by increasing the exemption for personal property.
Abbott also called for freezing county property taxes for seniors and making sure they automatically receive an additional $10,000 homestead exemption already set aside for seniors.
Notably, Abbott said budget writers in the House and Senate should look for federal funds made available under bills like the Infrastructure Investment and Jobs Act and Inflation Reduction Act — signature achievements of President Joe Biden — and “determine which programs are worthwhile to pursue.”
School vouchers and other policy pushes
Among the more widely debated policy ideas in Abbott’s proposal is that of diverting public school dollars to charter schools, private schools and home-schooling programs — a battle the Legislature has been fighting for decades and one that divides Republicans in rural and urban districts.
“Parents deserve the opportunity to choose the educational setting that is best for their child whether it is a traditional public school, public charter school, private school, or home-schooling,” Abbott wrote in his budget proposal.
The proposal suggests the creation of Education Savings Accounts to “provide parents with the option to use funding that would otherwise be allocated to their child’s public school on a variety of educational expenses such as private school tuition, online learning programs, instructional materials, and educational therapies.”
But critics of vouchers and similar programs, including rural Republicans and most Democrats, say they drain vital funding from a school system that is — unlike charter and private schools — accessible to all students and that should be fully funded.
“After almost a decade under Governor Abbott’s leadership, he answers the anger and frustration that parents and teachers feel in cash-strapped schools with a gimmick that further undermines the public education that the vast majority of Texas school children and their families rely upon,” state Rep. Gina Hinojosa, D-Austin, said in a statement.
Among Abbott’s budget priorities is putting at least $600 million toward what he called “school safety measures” that include technology upgrades; “hardening,” or increasing security, of school buildings and campuses to protect against mass shootings; and “expanded mental health resources.”
He also calls for $147 million to continue funding a statewide telehealth program to connect children with mental health resources through schools, a program run through the state’s universities by the Texas Child Mental Health Care Consortium.
Abbott also wants $6.6 million spent on active-shooter training for law enforcement officers, a priority he listed among his school initiatives.
The proposal makes no mention of substantially increasing funding to struggling public schools or tying funding to enrollment rather than attendance, both ideas pushed by public education advocates.
Public safety and border security
In the proposal, Abbott also praises his Operation Lone Star border initiative for detaining migrants and seizing the synthetic opioid fentanyl. Funding for the operation, which has involved the deployment of members of the Texas National Guard and Texas Department of Public Safety and has cost $4.3 billion in state funds so far, should continue, Abbott said. He wrote that Texas will continue to push the federal government to reimburse what he says are $6.7 billion in costs to the state to secure its border with Mexico.
In his proposal, Abbott asks for a new program to enhance death benefits for the Texas National Guard. In April, Bishop Evans died on Operation Lone Star while attempting to rescue migrants from the water. His family was not eligible for state death benefits, touching off an effort by lawmakers to change that policy.
“While much has been accomplished by the brave men and women at the border, there is still a great amount of work to be done to protect Texans, as the federal government shows no willingness to quell this humanitarian crisis,” the document says.
James Barragán contributed to this report.
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