1 00:00:08,800 --> 00:00:14,640 This week's trip Cast is sponsored by Texas Association of School Business Officials. School 2 00:00:14,640 --> 00:00:20,320 finance and Operations professionals make public schools thrive. Begin your journey in this rewarding 3 00:00:20,359 --> 00:00:28,679 profession at TASBO dot org and Texas Farm Bureau. Find affordable health coverage through 4 00:00:28,760 --> 00:00:32,719 Texas Farm Bureau's Health Plants. For more information or to get a quote, 5 00:00:33,000 --> 00:00:39,679 go to TFB health plans dot com or call eight seven seven five hundred zero 6 00:00:39,759 --> 00:00:56,479 one four zero ahead. Hello, and welcome to the Texas Tribune trip Cast. 7 00:00:56,600 --> 00:00:59,920 My name is Matthew Watkins, Managing editor for News and Politics for the 8 00:01:00,159 --> 00:01:03,879 Tribune. It is July fourteenth, and we finally have a property tax deal. 9 00:01:04,280 --> 00:01:10,719 After months and months and months of fighting and two special legislative sessions, 10 00:01:11,079 --> 00:01:15,799 Lawmakers on Thursday send an eighteen billion dollar property tax cut to Governor Greg Abbott's 11 00:01:15,799 --> 00:01:19,920 desk, where we assume it will be signed in short order. That brought 12 00:01:19,920 --> 00:01:23,560 an end, as we said, to a second special session of the legislature. 13 00:01:23,879 --> 00:01:26,959 We're going to talk about that today and what's coming next. And joining 14 00:01:27,079 --> 00:01:33,159 us to discuss that our Texas Tribune reporter Karen Brooks Harper, who has covered 15 00:01:33,159 --> 00:01:37,359 this issue for us. Hey, Karen Hi, and from the Texan News 16 00:01:37,359 --> 00:01:41,959 outlet politics reporter Brad Johnson. Hey, Brad, Hey, thanks for having 17 00:01:41,959 --> 00:01:45,680 me. Yeah, thanks for joining us. So, Karen, I want 18 00:01:45,680 --> 00:01:49,519 to start with you. There have been lots of negotiations, lots of proposals 19 00:01:49,640 --> 00:01:55,200 kicked around. What is in this final package that is being sent to the 20 00:01:55,280 --> 00:01:57,120 governor? What are we what kind of savings are we going to be seeing 21 00:01:57,200 --> 00:02:02,480 here? Well, if you're um, if you're a homeowner who lives in 22 00:02:02,519 --> 00:02:07,840 your home, that that property will see an average and I'm gonna that's doing 23 00:02:07,879 --> 00:02:13,960 a lot of work here. That word apen um savings of in the neighborhood 24 00:02:14,000 --> 00:02:17,639 of forty one forty two percent. If you're senior citizen, a text on 25 00:02:17,719 --> 00:02:21,919 with a disability, you get a little bit more than that, maybe forty 26 00:02:22,000 --> 00:02:24,080 four forty five percent. That is not across the board. That's not a 27 00:02:24,080 --> 00:02:28,400 percent that's in the law. That's the that's what it shakes out to based 28 00:02:28,400 --> 00:02:31,240 on average. It's gonna vary, but that's the that's the marquee member for 29 00:02:31,879 --> 00:02:36,159 you know, the average of the five point seven million homeowners. So then 30 00:02:36,199 --> 00:02:40,560 there's also an across the board school property tax decreased by by a ten point 31 00:02:40,599 --> 00:02:45,439 seven cents um, which is kind of the tax rate. You know, 32 00:02:45,479 --> 00:02:49,120 we don't need to get into the esoteric details, but so that's gonna that's 33 00:02:49,159 --> 00:02:54,919 gonna drop. Um those taxes an average of about brad is like twenty four 34 00:02:54,960 --> 00:02:59,199 to twenty eight percent on average for all the property owners will see that kind 35 00:02:59,199 --> 00:03:02,039 of reduction. I think that's one of the numbers I saw that's nah around 36 00:03:02,080 --> 00:03:08,000 there um and then and then there is the uh so that's going to be 37 00:03:08,280 --> 00:03:12,960 that's a that's the biggest price tag. And this thing, it's going to 38 00:03:13,039 --> 00:03:15,039 be seven and a half billion in new money, five point three billion in 39 00:03:15,120 --> 00:03:20,000 previous two thousand and nineteen money. So that's like a twelve point six billion 40 00:03:20,000 --> 00:03:23,159 dollars price tag on that particular on the homeowners exemption which goes from forty to 41 00:03:23,520 --> 00:03:28,520 forty thousand and one hundred thousand home set exemption savings I was talking about a 42 00:03:28,520 --> 00:03:30,719 minute ago. That's a five point three billion dollars price tag. So the 43 00:03:30,759 --> 00:03:37,520 rest of the eighteen billion dollars that's an est of it um package is going 44 00:03:37,560 --> 00:03:43,800 to things like franchise tax reductions, like savings people don't have to file the 45 00:03:43,879 --> 00:03:46,360 taxes if they don't pay the taxes anymore kind of a thing. And then 46 00:03:46,400 --> 00:03:51,759 there's also some reductions there. And then there's this novel new program that's going 47 00:03:52,199 --> 00:03:55,319 into the tax code that we haven't seen before in Texas, which is a 48 00:03:55,360 --> 00:04:01,840 temporary They're very careful to say that at twenty percent appraisal cap or in a 49 00:04:01,879 --> 00:04:09,400 cap on, you know, value values increases basically form non home seted properties, 50 00:04:09,400 --> 00:04:13,520 so that is business properties, rental homes, beach houses, you know, 51 00:04:14,000 --> 00:04:16,600 multifamily units, grocery stores, you know, oil and gas, which 52 00:04:16,680 --> 00:04:23,160 is actually significant minerals in general, as long as they're valued at five million 53 00:04:23,240 --> 00:04:29,199 or below this year, that can change by a percentage depending on the controller. 54 00:04:29,839 --> 00:04:32,199 And that's a three year program that will be sunseted, if that's the 55 00:04:32,319 --> 00:04:36,560 right word in both statue, and I believe they ended up changing the constitutional 56 00:04:36,560 --> 00:04:40,600 amendment to that too so that they could might do legislive ends are ends latter. 57 00:04:40,680 --> 00:04:43,720 So um, those are the four big pieces, and then there's a 58 00:04:43,879 --> 00:04:46,240 there's a component that I haven't actually looked too far into. Brad's probably a 59 00:04:46,240 --> 00:04:51,439 little more up on this than I am. About UM elected their appointed term 60 00:04:53,000 --> 00:04:56,439 appraisal boards that are supposed to. They're designed in a way that they'll be 61 00:04:56,879 --> 00:05:00,879 more accountable to the public. But again, I'm sorry to say I haven't 62 00:05:00,920 --> 00:05:02,160 done as much researched onto that one as I can. I was looking at 63 00:05:02,199 --> 00:05:04,639 the dollars on this one. But that's a selling point of this one. 64 00:05:04,680 --> 00:05:10,639 Also, what there isn't in there is protections for like renters, that guarantees 65 00:05:10,639 --> 00:05:12,639 for that kind of thing. But I imagine you'll get into that. I 66 00:05:12,680 --> 00:05:17,439 don't think I missed anything. I think yeah, all right, so Brett, 67 00:05:17,439 --> 00:05:20,879 I want to go to you and ask a little bit about the politics 68 00:05:20,879 --> 00:05:24,720 of this. We'll get a little bit more into the substance and the impact 69 00:05:24,759 --> 00:05:28,399 of this law here in a bit. But of course, the reason that 70 00:05:28,480 --> 00:05:33,399 it took so long to get a property tax cut was because despite the fact 71 00:05:33,519 --> 00:05:36,600 that the Big three, the leaders of the House, on the Senate and 72 00:05:36,680 --> 00:05:42,839 Government or Abbot, all really wanted this, they disagreed strongly on how to 73 00:05:42,879 --> 00:05:46,240 do this. You had Dan Patrick really pushing for homestead exemption. You had 74 00:05:46,399 --> 00:05:53,600 feeling the House Speaker for at least a considerable amount of time, wanting to 75 00:05:53,639 --> 00:05:58,439 do essentially just across the board tax cuts, cuts to the rates Abbott was 76 00:05:58,560 --> 00:06:01,519 at one time on board with that. They ended up going with, you 77 00:06:01,560 --> 00:06:06,680 know, something that included a major home said exemption increase. What should we 78 00:06:06,839 --> 00:06:11,680 take away? I mean, is it possible to kind of declare winners and 79 00:06:11,759 --> 00:06:15,279 losers in that political fight? Do we feel like Patrick got most of what 80 00:06:15,319 --> 00:06:19,439 he wanted? How do you kind of react to the kind of interpersonal dynamics 81 00:06:19,439 --> 00:06:25,319 of this. Well, you know, after hundreds of days of this dispute, 82 00:06:25,360 --> 00:06:28,319 going all the way back to the middle of the regular session, you 83 00:06:28,360 --> 00:06:33,079 know, we kind of ended up about back where we started with. Obviously, 84 00:06:33,199 --> 00:06:38,480 compression, which is the main portion of all of this. The homestead 85 00:06:38,480 --> 00:06:41,720 exemption, although it turned out to be higher than what the Senate originally asked 86 00:06:41,759 --> 00:06:46,120 for. They just wanted a seventy thousand dollar homestead exemption plus another bump for 87 00:06:46,639 --> 00:06:53,199 elderly and disabled. They got one hundred thousand dollars across the board. And 88 00:06:53,240 --> 00:06:56,199 then the House wanted an appraisal cap. They got an appraisal cap. Now 89 00:06:56,240 --> 00:07:00,439 it's, as Karen mentioned, it's a trial run and it's much smaller than 90 00:07:00,879 --> 00:07:05,480 what the House originally wanted. But in the end, the compromise came out 91 00:07:05,519 --> 00:07:10,879 with all three of those aspects, and so how do we sift out who's 92 00:07:10,879 --> 00:07:14,560 the winner who's the loser. I think they all got aspects of what they 93 00:07:14,560 --> 00:07:19,800 wanted, and I think by and large they got what they wanted more than 94 00:07:19,839 --> 00:07:25,319 anything else. Maybe Patrick slightly different on this, but Governor especially fits this 95 00:07:25,560 --> 00:07:29,279 is they got something, and you know, it is a lot of money. 96 00:07:30,040 --> 00:07:32,680 Eighteen billion dollars is the number they're sighting. As Karen said, you 97 00:07:32,720 --> 00:07:36,879 know, five point three of that is for you know, the twenty nineteen 98 00:07:36,920 --> 00:07:43,040 compression that was passed, So they're kind of double counting there when they say 99 00:07:43,079 --> 00:07:47,120 the eighteen billion dollars number, But it is eighteen billion dollars in new money, 100 00:07:47,439 --> 00:07:50,800 So that is that is accurate, even though it's an old law that 101 00:07:51,120 --> 00:07:56,240 a portion of that's going towards. But you know, ultimately, after this 102 00:07:56,399 --> 00:08:01,279 long drug out fight, at some points people thought that they might not get 103 00:08:01,319 --> 00:08:07,079 anything. You know, the Speaker and the Lieutenant Governor were were very much 104 00:08:07,120 --> 00:08:09,560 at odds, and then all of a sudden they did kind of a reset 105 00:08:09,720 --> 00:08:16,639 and whatever it was, maybe they'd had enough of this stalemate. All the 106 00:08:16,720 --> 00:08:22,800 legislators are are exhausted. M the Lieutenant Governor and Speaker said that um. 107 00:08:22,800 --> 00:08:28,319 Ultimately, this war of attrition just left everybody ready to compromise more um. 108 00:08:28,360 --> 00:08:33,080 I think, and Lieutenant Governor is probably a pretty big winner in this because 109 00:08:33,240 --> 00:08:39,360 he got one hundred thousand homestead exemption when the House and the Governor were united 110 00:08:39,360 --> 00:08:43,759 in just compression during the first first session and then most of the rest of 111 00:08:43,759 --> 00:08:50,080 the second specion session. But the Speaker drew a hard line on some sort 112 00:08:50,080 --> 00:08:54,279 of form of appraisal cap and he got that. So I think everybody's leaving 113 00:08:54,279 --> 00:08:56,960 with something that they that they like. Yeah, Karen, I mean the 114 00:08:58,360 --> 00:09:03,960 appraisal cap issue here a little bit like I wonder how big of an impact 115 00:09:03,960 --> 00:09:07,360 it will actually have. I mean, as already mentioned, it's temporary, 116 00:09:07,480 --> 00:09:11,279 right, it will expire eventually. A twenty percent cap on appraisal increases, 117 00:09:11,720 --> 00:09:16,720 you know, not unheard of, but it's you know, that's a pretty 118 00:09:16,759 --> 00:09:20,480 big increase. Those of us who live in Austin might be familiar with twenty 119 00:09:20,480 --> 00:09:24,440 percent increases in recent years, but it's not something you're going to see every 120 00:09:24,519 --> 00:09:30,360 year. And the fact that it's on properties valued at five million or lower 121 00:09:30,799 --> 00:09:35,679 that aren't considered homesteads because of course, homesteads already have that ten percent growth 122 00:09:35,679 --> 00:09:43,559 cap. I mean that feels like not the most kind of in terms of 123 00:09:43,600 --> 00:09:46,840 the impact on like what kind of taxes are going to be collected, not 124 00:09:46,960 --> 00:09:50,519 the most significant part of this law. Am I missing something there? Well, 125 00:09:50,720 --> 00:09:54,159 it's just sticking their toes in the water. And there's a couple of 126 00:09:54,159 --> 00:10:00,679 reasons for that. Because there's, first of all, there's very broad criticism 127 00:10:00,759 --> 00:10:05,600 outside the House Chamber of an appraisal cap across the board. I don't know 128 00:10:05,600 --> 00:10:11,159 how much it would cost businesses or do not like that necessarily for some reason, 129 00:10:11,240 --> 00:10:13,120 you know, I mean, I mean there's you know what. I'm 130 00:10:13,159 --> 00:10:16,360 not even gonna go into all the things. It's just we take two logs 131 00:10:16,399 --> 00:10:18,279 to talk about the things. I mean, people were worried that it wouldn't 132 00:10:18,279 --> 00:10:24,240 mess with the market. And then but politically, there's a huge ground swell 133 00:10:24,399 --> 00:10:28,440 for people wanting to wanting appraisal caps on businesses, even in homes, right, 134 00:10:28,480 --> 00:10:33,320 even if they don't know, um really what it would do. So 135 00:10:33,000 --> 00:10:37,600 um politically it seems like they needed something to bring back to those particular grassroots. 136 00:10:37,639 --> 00:10:41,919 But also they can kind of keep a rain on the cost because it 137 00:10:41,960 --> 00:10:50,519 won't be it won't be as broad as as you know. The original proposal 138 00:10:50,679 --> 00:10:52,879 was to just do the appraisal cops all the way for everybody, you know, 139 00:10:52,000 --> 00:10:58,440 for other So you know, there's a large number of businesses and commercial 140 00:10:58,639 --> 00:11:03,759 properties that are under five million dollars um. You know, and you're talking 141 00:11:03,799 --> 00:11:07,840 probably most Texans you know, rental properties or second homes, and you know, 142 00:11:07,120 --> 00:11:13,480 Um, the fact that it brings in minerals is interesting because Brad, 143 00:11:13,320 --> 00:11:16,039 you know, I think to bring you in on it, because you've been 144 00:11:16,120 --> 00:11:20,799 right there for the whole time too. Um, they're they're kind of there. 145 00:11:20,159 --> 00:11:24,519 They're per parcel, not per entire business interest. For so one business 146 00:11:24,559 --> 00:11:28,200 can have five stores and each store can be less than five million, and 147 00:11:28,240 --> 00:11:33,399 they each get that praisal cap. That's actually could have some impacts, especially 148 00:11:33,440 --> 00:11:39,320 if you're talking about minerals companies, right. I think that deserves a lot 149 00:11:39,360 --> 00:11:43,399 more study. And I think I believe I heard them say that it would 150 00:11:43,440 --> 00:11:50,279 be about a three hundred million dollars a year um program. Perhaps, but 151 00:11:50,399 --> 00:11:52,559 that might they might have been speaking about something else, but it wasn't a 152 00:11:52,639 --> 00:11:58,480 very high number. And they they feel like they can see what it does 153 00:11:58,519 --> 00:12:01,799 for the next few years before they can that are maybe broadening it. The 154 00:12:01,840 --> 00:12:07,480 other thing is that there's you know, the controller can shift it to a 155 00:12:07,519 --> 00:12:13,799 certain degree that number based on you know, consumer price index, so like 156 00:12:13,879 --> 00:12:16,879 the inflation, right, so it doesn't have to stick at five million. 157 00:12:16,879 --> 00:12:22,000 It could wind up higher than that before the three years is out. So 158 00:12:22,840 --> 00:12:26,240 you know, it's it's it's as close to the appraisal cap as they were 159 00:12:26,279 --> 00:12:28,879 going to get. But it is an appraisal cap. And and the fact 160 00:12:28,919 --> 00:12:33,279 that they're calling it a circuit breaker just tells you that they really don't want 161 00:12:33,279 --> 00:12:37,480 it being an appraisal cap. And the rhetoric out there, you're calling it 162 00:12:37,519 --> 00:12:41,679 the circuit breaker because it's temporary and because it's kind of aimed at lower values. 163 00:12:41,679 --> 00:12:46,320 At least that's what Bedcourt was telling me. But you know, Huffman 164 00:12:46,360 --> 00:12:50,159 and the other Senate Finance members and the other budget writers have acknowledged publicly and 165 00:12:50,279 --> 00:12:52,600 very plainly that it's not income based, it's not targeted towards you know, 166 00:12:52,639 --> 00:12:56,879 your ability to pay. It's not your true like political circuit breaker. I 167 00:12:56,919 --> 00:13:01,200 know, nobody can see my air quotes when I'm using air. Yeah, 168 00:13:01,279 --> 00:13:07,879 you know, this fight, as we tried to kind of think through the 169 00:13:07,000 --> 00:13:13,919 idea of homestead exemptions pushed by Dan Patrick or you know, broad compression, 170 00:13:13,840 --> 00:13:18,600 which you know, the idea of compression is essentially lowering the property tax rate 171 00:13:18,679 --> 00:13:22,480 equally across everyone who pays property taxes. As we tried to kind of evaluate 172 00:13:22,519 --> 00:13:28,159 this during these debates, one of the things that we really tried to think 173 00:13:28,200 --> 00:13:33,519 about is so who benefits from what plan? Right and Dan Patrick's plan essentially, 174 00:13:33,559 --> 00:13:37,320 what it was aiming to do as he was discussing this was to folk 175 00:13:37,480 --> 00:13:43,200 direct more of the savings towards homeowners than it being, you know, the 176 00:13:43,240 --> 00:13:52,240 same percentage across the board. What there's a statistic in your story Karen from 177 00:13:52,240 --> 00:13:58,000 the Texas Taxpayers and Research Association talking about how the expectation that they have from 178 00:13:58,000 --> 00:14:03,200 this is that it will in some ways shift some of the school tax burden 179 00:14:03,600 --> 00:14:09,440 toward businesses from the homemown owners. The numbers that she cited is that businesses 180 00:14:09,679 --> 00:14:13,279 currently pay around fifty two percent of school taxes. That will go up to 181 00:14:13,360 --> 00:14:18,200 fifty five percent of school taxes. Homeowners Meanwhile, their share, according to 182 00:14:18,320 --> 00:14:24,399 this estimate, will drop from forty eight percent to forty five percent forty four 183 00:14:24,440 --> 00:14:28,840 point eight percent. Essentially, you know, Brad, I think everyone's getting 184 00:14:28,919 --> 00:14:33,960 savings here. Is there any risk of a pushback from businesses, of a 185 00:14:33,000 --> 00:14:39,480 backlash from businesses? Is there frustration from businesses to be seeing that, you 186 00:14:39,519 --> 00:14:46,480 know, somewhat subtle shift. Well, Karen mentioned the business is not wanting 187 00:14:48,240 --> 00:14:54,399 the appraisal cap, and back during the regular session that was the case. 188 00:14:54,720 --> 00:15:01,000 But there was this interesting dynamic where big businesses didn't like the appraisal cap, 189 00:15:01,240 --> 00:15:05,120 but it was the very small ones that would benefit the most from this kind 190 00:15:05,159 --> 00:15:09,639 of thing because they're, you know, their margins are a lot tighter and 191 00:15:09,000 --> 00:15:13,039 they, um, you know, a five percent appraisal cap, which is 192 00:15:13,080 --> 00:15:18,360 at the time what the plan was a proposal was, would would really help 193 00:15:18,399 --> 00:15:22,320 them. Um. Then it got kind of into this as this argument about 194 00:15:22,840 --> 00:15:28,120 effect on the market, and you know, there are the The Senate pointed 195 00:15:28,159 --> 00:15:33,600 to California as an example of issues that can come from that, But the 196 00:15:33,639 --> 00:15:37,159 House pointed to Florida. Florida has an appraisal cap too. We don't see 197 00:15:37,159 --> 00:15:39,720 issues they're like we do in California. So both sides have their arguments. 198 00:15:41,440 --> 00:15:46,360 Um, as far as shifting the burden, um, you know, compression 199 00:15:46,360 --> 00:15:50,600 applies to everybody equally, But that's only uh, you know, in in 200 00:15:50,639 --> 00:15:54,720 the calculation, um, you know, in terms of how much money comes 201 00:15:54,720 --> 00:15:58,799 out of people's pockets. You know, when you raise the home set exemption, 202 00:15:58,840 --> 00:16:03,480 that means fewer there's less money coming out of homeowners into the school finance 203 00:16:03,519 --> 00:16:07,080 system, and so that's going to go somewhere else. There was a lot 204 00:16:07,120 --> 00:16:11,279 of talk about, well, how do we how do we get not only 205 00:16:11,320 --> 00:16:17,759 the state but these school districts to spend less money and that's not really something 206 00:16:17,799 --> 00:16:21,720 that's ever ever fully addressed. You know, it's talked about here and there. 207 00:16:22,399 --> 00:16:27,639 But then you add to the fact that inflation has been really bad the 208 00:16:27,679 --> 00:16:36,080 last last couple of years and the that's affecting school district budgets, the costs 209 00:16:36,080 --> 00:16:41,240 they're incurring not only for just day to day operations but also building Um, 210 00:16:41,399 --> 00:16:45,120 you know, it costs a lot more to build a new school or build 211 00:16:45,159 --> 00:16:48,960 a you know, an athletic stadium, things like that. So it's just 212 00:16:49,080 --> 00:16:56,080 kind of like a shell game shifting around where the biggest pot of money is 213 00:16:56,080 --> 00:16:59,679 coming from. But overall, you know, it's not really going to change 214 00:16:59,720 --> 00:17:06,720 things that much because this is not this reform is not you know, a 215 00:17:06,799 --> 00:17:11,720 move away from the property tax system. It is is at root increasing the 216 00:17:11,759 --> 00:17:18,559 state's share of payments into the school finance system for the next biennium. That 217 00:17:18,880 --> 00:17:22,599 there's a whole other discussion to have. Is this sustainable? You know, 218 00:17:22,079 --> 00:17:26,559 if we don't have another massive surplus next session, can they continue to do 219 00:17:26,640 --> 00:17:30,799 this? Um, that's a question that well, we won't have answered until 220 00:17:30,839 --> 00:17:36,920 next session. But for now, it's it's going to reduce property tax payments 221 00:17:37,720 --> 00:17:42,720 in the short run. I do I am interested in the conflation of the 222 00:17:42,839 --> 00:17:48,920 school funding next time around for this, like the sustainability and this push for 223 00:17:49,079 --> 00:17:56,559 vouchers, which would ultimately could ultimately lower the enrollment numbers in schools, you 224 00:17:56,599 --> 00:18:00,680 know, in public education, right, that's would be that I don't know 225 00:18:00,720 --> 00:18:03,000 how big an effect that would be, honestly, I don't even I don't 226 00:18:03,039 --> 00:18:07,480 know. But presumably if school if students are to exit in public schools and 227 00:18:07,519 --> 00:18:11,039 go to private schools or parochial schools and devoutch their program that they're debating at 228 00:18:11,079 --> 00:18:15,880 the same time as they're debating more school funding later this year, right, 229 00:18:17,079 --> 00:18:21,400 then that could wind up in less money that they can just or try can 230 00:18:21,440 --> 00:18:25,720 try to justify sending less money to schools in two years, whether I mean 231 00:18:25,799 --> 00:18:29,759 there's going to be a there's a just a cacophony of voices they're screaming right 232 00:18:29,759 --> 00:18:32,599 now, you know, listening to this, I'm sure going but it's not 233 00:18:32,720 --> 00:18:36,119 enough right now. And that's not a new that's not a new point of 234 00:18:36,200 --> 00:18:37,200 view, obviously, it's something we've been hearing for a long time, as 235 00:18:37,200 --> 00:18:41,319 at the schools are under funded. But um, but I'm interested to see, 236 00:18:41,359 --> 00:18:45,599 like you are, what happens in twenty twenty five? Is it twenty 237 00:18:45,680 --> 00:18:48,599 five? Are we there twenty five? Yet? I don't feels like what 238 00:18:48,799 --> 00:18:53,559 year is it? Yeah, twenty to twenty five when they come back with 239 00:18:53,799 --> 00:18:59,200 you know, either surplus or not, and you know, there's they're eighteen 240 00:18:59,240 --> 00:19:03,559 billion dollars the hook, um or not? You know, I don't know, 241 00:19:03,640 --> 00:19:07,440 let's stay. I mean it's it's uh, it's and then they have 242 00:19:07,559 --> 00:19:10,799 this this appraisal program that they would need to like figure out what to do 243 00:19:10,799 --> 00:19:15,440 with it. So, uh, it's it's interesting, That's all I had. 244 00:19:15,680 --> 00:19:18,920 Yeah, on the on the school choice aspect, you know, the 245 00:19:18,920 --> 00:19:26,480 Senate tried to at the beginning, tried to solve that concern in reimbursing school 246 00:19:26,480 --> 00:19:30,119 districts, you know, plus some you know, giving them ten thousand dollars 247 00:19:30,759 --> 00:19:34,960 per student of theirs that left under this program. Obviously it didn't go anywhere, 248 00:19:36,319 --> 00:19:38,720 but that was an effort to try and um, you know, hold 249 00:19:38,759 --> 00:19:44,400 these schools harmless, as they like to say on all this school finance stuff. 250 00:19:44,440 --> 00:19:49,240 But um, it's that would have to you know, that that would 251 00:19:49,240 --> 00:19:56,279 who have implications for the state's share of funding in this and yeah how much? 252 00:19:56,240 --> 00:20:00,359 Yeah, yeah, because that's just that makes the programs so much even 253 00:20:00,359 --> 00:20:03,799 that much more expensive, right, and plus they could take that away at 254 00:20:03,799 --> 00:20:07,559 any point, put that in place now, and then it's like, well 255 00:20:07,559 --> 00:20:10,680 it's not working so far, right, you guys are doing by let's just 256 00:20:10,759 --> 00:20:15,160 you know, oh yeah, yeah, Well, Karen, you mentioned the 257 00:20:15,200 --> 00:20:19,839 idea of you know, certain people making the argument that schools are already not 258 00:20:19,960 --> 00:20:25,480 sufficiently funded. This was of course, something that Democrats were interested in talking 259 00:20:25,519 --> 00:20:30,440 about and wanted to push for in this package. They ended up not getting 260 00:20:30,440 --> 00:20:37,400 it, of course, and they ended up almost unanimously voting for the package 261 00:20:37,799 --> 00:20:41,359 despite having some leverage in this right. Because one of the things that needs 262 00:20:41,400 --> 00:20:47,359 to happen is a constitutional amendment to approve this entire package, which requires a 263 00:20:47,359 --> 00:20:51,119 two thirds vote in the House, and you can't have a two thirds vote 264 00:20:51,160 --> 00:20:56,519 in the House without the support of a number of Democrats. Why do you 265 00:20:56,599 --> 00:21:00,759 think they ended up going along with this plan? Fight those calls and those 266 00:21:00,759 --> 00:21:07,839 pushes. This was a matter of a lot of speculation yesterday on the floor 267 00:21:07,880 --> 00:21:10,160 over the course of them, sure, Brad or remember of the course of 268 00:21:10,200 --> 00:21:15,079 eight hours of sitting there wondering what was going to happen, flying long stretches 269 00:21:15,119 --> 00:21:19,680 of points of order we were waiting to pass. But um, but you 270 00:21:19,720 --> 00:21:23,400 know, at some point when we were seeing the fifty one votes for all 271 00:21:23,400 --> 00:21:29,680 the Democratic amendments, we were thinking they were going to derail the HJR. 272 00:21:29,839 --> 00:21:33,319 And then we realized that ultimately, you know, and as we saw, 273 00:21:33,559 --> 00:21:37,119 you know, there were a lot of people in the offices that were thinking 274 00:21:37,160 --> 00:21:41,720 that the Democrats were going to derail the HR at least on first reading. 275 00:21:41,839 --> 00:21:44,200 I mean, yeah, I'm first reading or a second reading. Sorry, 276 00:21:44,880 --> 00:21:47,880 They would have had a chance again it today to get those hundred if they 277 00:21:47,880 --> 00:21:52,759 hadn't reached it yesterday. But um, I mean, ultimately, it's it's 278 00:21:52,839 --> 00:21:59,359 not easy to explain to your constituents that you have that you voted against or 279 00:21:59,519 --> 00:22:03,519 killed property tax relief bill that would have saved them forty percent on their property 280 00:22:03,559 --> 00:22:08,519 taxes. And while the Democrats did have leverage, you know, I think 281 00:22:08,519 --> 00:22:14,880 that ultimately the notion of killing the property tax bill and being even remotely made 282 00:22:14,960 --> 00:22:18,400 responsible for that right now, it was the Republicans that were endangering that. 283 00:22:18,559 --> 00:22:23,880 You know, if the Democrats killed it because the Republicans refused to play ball 284 00:22:23,960 --> 00:22:27,440 on teacher pay raise, they could easily say, you know it just it 285 00:22:27,440 --> 00:22:33,480 didn't sound like a solid enough political strategy to enough for the Democrats. And 286 00:22:33,680 --> 00:22:38,880 ultimately the texts I got right after the HJR vote of like one hundred and 287 00:22:38,920 --> 00:22:45,079 thirty two or something right to the five it was, you know, oh, 288 00:22:45,119 --> 00:22:48,119 a bunch of Democrats flipped, you know, they were going to hold 289 00:22:48,119 --> 00:22:52,920 the line against the HDR and they flipped like sixty percent of their constituents or 290 00:22:52,920 --> 00:22:56,839 renters for example, So they wanted to be able to make the case for 291 00:22:56,880 --> 00:23:03,359 their renters, and their amendments weren't germane. They were easily killed on technicalities, 292 00:23:03,519 --> 00:23:07,759 you know, at least by the justification of the parliamentarian and everybody knew 293 00:23:07,759 --> 00:23:10,839 that, So I think the compromise at the end of the day was, 294 00:23:10,920 --> 00:23:12,920 let us make our case, let us see if we can't force some votes 295 00:23:12,960 --> 00:23:18,839 on this, let me take my votes back to you know, back to 296 00:23:18,920 --> 00:23:22,920 my people, and we won't de rail your constitutional amendment because ultimately a no 297 00:23:22,079 --> 00:23:26,200 vote on that's going to look worse for most people. That's my long winded 298 00:23:26,400 --> 00:23:29,400 you know, that's kind of where we landed at the end of the day. 299 00:23:29,440 --> 00:23:33,119 But I don't know, Brad, what do you think. Yeah, 300 00:23:33,119 --> 00:23:37,039 I think it was kind of laying the groundwork for what we're going to see 301 00:23:37,039 --> 00:23:41,480 in this school choice special. Whenever that happens sounds like October. I mean, 302 00:23:41,519 --> 00:23:45,599 that's when Democrats are really going to push for the you know, the 303 00:23:47,119 --> 00:23:52,240 school funding aspects of this teacher pay what have you. We saw one amendment 304 00:23:52,319 --> 00:23:56,079 from represent John Bryant trying to give or maybe this trademartiness Fisher trying to give 305 00:23:57,200 --> 00:24:03,440 teachers specifically one hundred and fifty thousand dollars homestead exemption. And um, I'm 306 00:24:03,440 --> 00:24:07,480 not sure if that was killed on a Germanist point of order, if it 307 00:24:07,519 --> 00:24:12,240 was just voted down, but um, I think it is very difficult for 308 00:24:12,279 --> 00:24:18,039 anyone. We saw this with Republicans too. Republicans, especially on the right 309 00:24:18,039 --> 00:24:21,519 side of the GOP Caucus, we're trying to amend the bill as well. 310 00:24:22,680 --> 00:24:26,519 They wanted to make it bigger, and so they're not necessarily you know, 311 00:24:26,519 --> 00:24:32,079 like the Freedom Caucus and those even further right of the Freedom Caucus. Some 312 00:24:32,279 --> 00:24:37,720 Tinder Holton and a couple others, they're not they're not in love with this 313 00:24:37,759 --> 00:24:41,720 plan either. They think it doesn't do enough, doesn't put enough money towards 314 00:24:41,839 --> 00:24:45,920 this um. But in the end, almost all of them voted for the 315 00:24:45,960 --> 00:24:52,200 bill because it is very difficult to vote against a property tax cut, especially 316 00:24:52,240 --> 00:24:56,559 one you know, it's not it's not pennies on the dollar like it's it's 317 00:24:56,599 --> 00:25:00,599 significant, there are issues with it, there are questions to be asked, 318 00:25:00,880 --> 00:25:03,319 and there certainly could have been more money thrown at it, but it was 319 00:25:03,359 --> 00:25:10,559 not nothing, and so just politically, it's it would be a very difficult 320 00:25:10,720 --> 00:25:15,440 vote to justify back in their districts. It's an interesting observation too. I've 321 00:25:15,519 --> 00:25:18,319 kind of forgotten about it, and all the talk about the renters and the 322 00:25:18,359 --> 00:25:22,680 teachers and everything about the handful of Republicans who tried to amend it as well. 323 00:25:22,880 --> 00:25:26,880 You know, there definitely was a moment when they stopped killing each other's 324 00:25:26,880 --> 00:25:29,799 amendments some points of order and just let them have the floor for a while 325 00:25:29,799 --> 00:25:33,319 and make their arguments and have their votes. I remember which which Brian amendment 326 00:25:33,400 --> 00:25:40,839 that started on or who's but but you know it, keeping the hundred votes 327 00:25:41,240 --> 00:25:44,240 was at the end of the day, they did a good job of it. 328 00:25:44,279 --> 00:25:48,000 Obviously they way surpassed that. But it wasn't just a Democrats they had 329 00:25:48,000 --> 00:25:49,759 to keep their eye on for that. You know, you're right they were 330 00:25:49,839 --> 00:25:53,720 risking. But you know, I think it was an easy sell honestly once 331 00:25:53,759 --> 00:25:57,640 they had you know, cutting people's homeowner you know taxes and a half or 332 00:25:57,680 --> 00:26:02,279 close to it, and you know property taxes across the board. And I 333 00:26:02,359 --> 00:26:04,079 think you just can't bring a no vote on that back to your district unless 334 00:26:04,079 --> 00:26:07,599 you have a very specific style of district, like you know, maybe something 335 00:26:07,720 --> 00:26:11,519 do. The only other thing I think, sorry, sorry, kay Off. 336 00:26:11,559 --> 00:26:15,119 The other thing I think should be noted is that in its whole discussion 337 00:26:15,119 --> 00:26:19,799 we hear savings. You know, the legislators themselves said it constantly, but 338 00:26:19,880 --> 00:26:26,200 that savings is a reduction from what their tax bill would be without stars reform, 339 00:26:26,440 --> 00:26:30,119 it's not a reduction from what they paid last year. And so you 340 00:26:30,160 --> 00:26:34,599 know, odds are you're still probably gonna pay more than you did the previous 341 00:26:34,680 --> 00:26:41,119 year, but it will be significantly less than without this this reform. Well, 342 00:26:41,160 --> 00:26:44,640 and that may be why they stuck the part in the bill that says 343 00:26:44,680 --> 00:26:48,240 that the taxing districts has to include a notice with the tax bills this year 344 00:26:48,319 --> 00:26:53,240 saying, due to acts by the Texas Lady Texas legislature, what your tax 345 00:26:53,279 --> 00:26:56,599 bill would have been, this is how much you're saving, and this is 346 00:26:56,599 --> 00:27:02,480 how much it will now be. It's like a flyer like it is very 347 00:27:02,559 --> 00:27:07,119 much in advertising it for how the legislators have saved you many and you know, 348 00:27:07,279 --> 00:27:08,759 I mean maybe that's what people want to see. I'm going to be 349 00:27:08,799 --> 00:27:14,839 interested to see, you know, see that too. But because people might 350 00:27:14,960 --> 00:27:18,960 say, see a number that's not forty one percent lower than their last year's 351 00:27:18,039 --> 00:27:22,359 never and say what I thought I was going to And you're right, really 352 00:27:22,440 --> 00:27:26,960 it's just it's a comparative number. So so yeah, that's I guess that's 353 00:27:26,960 --> 00:27:30,799 going to be made clear to everybody when they read their letters. All right, 354 00:27:30,880 --> 00:27:34,599 let's pause for a moment here from our sponsors, Texas twenty thirty six, 355 00:27:34,880 --> 00:27:40,880 building long term, data driven strategies to secure Texas's prosperity through our bi 356 00:27:40,960 --> 00:27:47,000 centennial and beyond. Find out more at Texas twenty thirty six dot org and 357 00:27:47,720 --> 00:27:53,599 philanthropy advocates. Texas Philanthropy knows that advancing education is investing in economic opportunity for 358 00:27:53,680 --> 00:27:59,200 students, families, and our state. Find out more at eed, tx 359 00:27:59,559 --> 00:28:03,160 dot or work. Okay, so, Brad, as you mentioned, we 360 00:28:03,200 --> 00:28:10,319 are looking at a likely at least one more special session in October related to 361 00:28:10,400 --> 00:28:17,720 school choice. That is, you know, setting aside even the impeachment convening 362 00:28:18,480 --> 00:28:27,160 of the Senate in September. The compared to property taxes, I mean sorry, 363 00:28:27,200 --> 00:28:32,319 compared to school choice property taxes seems like a pretty easy proposition. We 364 00:28:32,359 --> 00:28:36,160 are not going to get a you know, only five votes out of against 365 00:28:36,200 --> 00:28:42,279 whatever bill comes out on school choice. Take the temperature for me of the 366 00:28:42,480 --> 00:28:49,759 relationship between Dan Patrick and Dade feeling right now heading into that conversation. Are 367 00:28:49,799 --> 00:28:52,960 we in a better place than we were at the end of May, A 368 00:28:53,079 --> 00:28:57,599 worst place about the same? What do you think? Well, the way 369 00:28:57,599 --> 00:29:03,200 they've been talking the last five six days. Clearly they're in a better place 370 00:29:03,240 --> 00:29:07,880 than they were at the end of the first special session when the House you 371 00:29:07,920 --> 00:29:12,359 know, gabbled out siny die in the first day and the Senate convened every 372 00:29:12,440 --> 00:29:18,079 day and just railed against them for doing so. M you know, there 373 00:29:18,079 --> 00:29:23,240 aren't there also aren't just debates or discussions or memes being sent it back and 374 00:29:23,279 --> 00:29:29,839 forth, criticizing each other on Twitter, you know. So overall they're at 375 00:29:29,839 --> 00:29:33,440 a better place, no doubt. Is it enough to get something like school 376 00:29:33,519 --> 00:29:37,079 choice across the line? Um? Yeah, gosh, I don't know. 377 00:29:37,359 --> 00:29:44,960 Um. The property tax fight seemed. We just talked about how it was 378 00:29:45,000 --> 00:29:48,920 not very It was hard to object for any member to that. Um as 379 00:29:48,920 --> 00:29:55,240 an issue itself. The problem the problems came in the breakdown happened between the 380 00:29:55,279 --> 00:30:02,440 Speaker and the Lieutenant Governor after weeks and weeks of hitting each other on on 381 00:30:02,519 --> 00:30:04,559 certain things, the appraisal cap in the homestead exemption. But here, you 382 00:30:04,599 --> 00:30:10,480 know, this is not just a lightning rod issue between the Speaker and Lieutenant 383 00:30:10,519 --> 00:30:15,599 Governor. It's a lightning rod issue between the members, especially in the House. 384 00:30:15,000 --> 00:30:19,640 You know. Not only this is not a a few Democrats might hold 385 00:30:19,640 --> 00:30:23,160 the line and try and stop this hj R from going through. This is 386 00:30:23,400 --> 00:30:30,119 Republicans are opposed to, especially the kind of school choice reform that Lieutenant Governor 387 00:30:30,160 --> 00:30:37,000 in much of the Senate wants. So it's going to come down to how 388 00:30:37,079 --> 00:30:42,920 much the Senate is willing to give on their ideal school choice plan. Because 389 00:30:44,400 --> 00:30:49,359 we've seen over and over again those members of the Republican Party, most of 390 00:30:49,400 --> 00:30:52,799 them are you know, towards the towards the middle, closer to the middle 391 00:30:52,839 --> 00:30:56,519 of the of the caucus, but not all of them being opposed to a 392 00:30:56,559 --> 00:31:00,119 school choice plan. There they're very much Again, they voted again, there 393 00:31:00,119 --> 00:31:04,119 were two test votes this session, and many of them voted against both of 394 00:31:04,119 --> 00:31:11,319 them. So the Senate is going to have to figure out ways to provide 395 00:31:11,759 --> 00:31:15,200 those members with a significant enough carrot. I don't think they're going to beat 396 00:31:15,240 --> 00:31:18,000 them into submission over this. It's not going to happen. You know. 397 00:31:18,279 --> 00:31:22,000 One of the ways we saw Abbott exert his leverage in this fight, Karen 398 00:31:22,240 --> 00:31:27,519 was related to vetoing a bunch of bills and putting into the Veto statement, 399 00:31:27,640 --> 00:31:32,880 you know, this is not as important as cutting Texans property taxes. Did 400 00:31:32,960 --> 00:31:37,400 that have any impact do you think on this conversation? Well, first of 401 00:31:37,440 --> 00:31:41,880 all, he was right. I mean they were I'm not going to bash 402 00:31:41,960 --> 00:31:45,839 anybody's legislation because it all affects somebody, right, But in the scheme of 403 00:31:45,920 --> 00:31:49,039 things, they weren't exactly blockbuster bills he did in veto the budget. There 404 00:31:49,160 --> 00:31:53,640 was no like threatening of hundreds of millions for community colleges or anything like that. 405 00:31:53,680 --> 00:31:59,759 These were some local bills, some niche bills. And again I'm going 406 00:31:59,799 --> 00:32:01,640 to probably get in trouble for that, but from somebody like I said, 407 00:32:01,720 --> 00:32:06,440 not, you know, it's all important. But if we're talking about levels, 408 00:32:07,240 --> 00:32:08,920 he was right, they weren't as important as property taxes, but they 409 00:32:08,920 --> 00:32:12,519 were already passed, so what he was trying to do obviously it was just 410 00:32:12,599 --> 00:32:15,400 kind of stick it to them a little bit. But at the end of 411 00:32:15,440 --> 00:32:17,480 the day, if you know, if you if you asked Patrick anyway, 412 00:32:17,640 --> 00:32:21,400 and obviously you know, if you see the result of it, it didn't 413 00:32:21,440 --> 00:32:24,400 seem to sway anybody. Um, I don't know that it moves the needle 414 00:32:24,519 --> 00:32:28,039 at all, And if it did, I don't think there's anybody that would 415 00:32:28,039 --> 00:32:31,079 admit that it did. Um, I you know, it kept us all 416 00:32:31,160 --> 00:32:35,920 on pins and needles and hitting refresh on our vitail list until midnight on Sunday 417 00:32:36,000 --> 00:32:39,119 night that night, right on the deadline, but which was right before my 418 00:32:39,200 --> 00:32:45,480 vacation, thanks because he never did anything to the budget and that's what we 419 00:32:45,480 --> 00:32:50,240 were watching for, you know. So um so, yeah, you know 420 00:32:50,319 --> 00:32:53,200 it was. It was an interesting dramatic wrinkle and the whole thing. But 421 00:32:53,400 --> 00:32:58,799 you know, I don't think that it was the it was the moves the 422 00:32:58,880 --> 00:33:01,880 needle all that much. If anything, it just kept up the pressure, 423 00:33:02,119 --> 00:33:07,240 you know, it just it kept up the pressure. A lot of the 424 00:33:07,240 --> 00:33:10,359 reaction I heard was, yeah, I was kind of weird. Well, 425 00:33:10,880 --> 00:33:15,079 the leverage the governor had was the threat of the vetos. As soon as 426 00:33:15,119 --> 00:33:19,039 he vetoed them, all that leverage is gone. You know, it's it's 427 00:33:19,079 --> 00:33:22,519 done and over with. So what what incentive do members have after it's already 428 00:33:22,519 --> 00:33:28,960 happened to play ball now where they wouldn't before. So it did not do 429 00:33:29,000 --> 00:33:31,200 anything. And now it leaves the question of do we have all these other 430 00:33:31,279 --> 00:33:36,400 bills in a special session with these school issues or do we have a separate 431 00:33:36,440 --> 00:33:42,720 special session later questions that are are being asked and we won't have an answer 432 00:33:42,720 --> 00:33:45,720 to until later. Yeah, all right, it was doing them all. 433 00:33:45,759 --> 00:33:50,359 That was like striking fear into people, you know, it was making people 434 00:33:50,400 --> 00:33:52,319 like me watch the budget to see if he was going to start doing that, 435 00:33:52,480 --> 00:33:55,920 you know, or yeah, people who had real, real skin in 436 00:33:55,920 --> 00:34:00,440 the game on some of these major pieces, if he was going to do 437 00:34:00,440 --> 00:34:04,519 that, because that's what those little those little guys fell for was to was 438 00:34:04,559 --> 00:34:07,400 to foreshadow a big, big death that never happened on those build on those 439 00:34:07,440 --> 00:34:09,599 vitaos. Anyway, I just want to put that point. It go ahead, 440 00:34:09,639 --> 00:34:14,239 Matthew, please, oh we have you know, there will be lots 441 00:34:14,280 --> 00:34:16,519 to watch and lots more to discuss, but Gus, but I think that 442 00:34:16,519 --> 00:34:21,880 that is about the end of it for today. Maybe Karen and Brad can 443 00:34:21,920 --> 00:34:28,320 get a nice little vacation before the next one comes up. Willing. Thank 444 00:34:28,360 --> 00:34:30,440 you to both of y'all for joining us, and thank you to Justin, 445 00:34:30,519 --> 00:34:35,360 our producer, and thank you to our sponsors, the Texas Association of School 446 00:34:35,400 --> 00:34:40,039 Business Officials, Texas Farm Bureau Texas twenty thirty six, and Philanthropy Advocates. 447 00:34:40,119 --> 00:34:52,800 We'll talk to y'all next week. The Texas Tribute Festival is a multi day 448 00:34:52,880 --> 00:34:57,960 celebration of big, bold ideas about politics, public policy, and the day's 449 00:34:58,000 --> 00:35:01,320 news, headlined by thought leaders, innovators, and change makers. The twenty 450 00:35:01,360 --> 00:35:07,719 twenty three Tribfest runs September twenty first through the twenty third in Austin. Learn 451 00:35:07,800 --> 00:35:08,920 more at tribfest dot org