America's Property Tax Advisor

Houston - Mixed Bag of Tax Hikes and Cuts


Big changes are proposed with property tax rates in Houston’s major tax jurisdictions – Harris County, the City of Houston, and the Houston Independent School District. The changes are brought about by new state legislation that applies to cities and counties of more than 30,000 residents.


Currently, when local taxing entities propose raising property tax revenues more than 8% above the previous year, voters can petition for a rollback election in which they can approval or reject the proposed tax increase.


Starting next year, revenue increases are limited to 3.5% unless voters approve a larger tax hike.


Harris County


Harris County Commissioners expressed concerned that the cap, which goes into effect next year, will hamper the county’s ability to adequately fund flood control, health care, and infrastructure. So, they proposed a one-time tax hike to create a reserve fund. If approved in October, it will be the first county property tax increase in 23 years.


The Commissioners Court proposed a property tax rate of $0.65260, which would bring in nearly 8% more in tax revenue. The proposed rate is well above the effective “no-new revenue” rate of $0.61170. Since commissioners proposed a tax rate higher than the effective rate, the county must hold public hearings on the matter.




The Houston City Council voted to cut its property tax rate for the fourth time in five years. In 2016, the city tax rate dropped to $0.58 cents on each $100 of taxable value. In 2017, the rate dropped again. In 2018, the rate rose slightly. This year, the rate will decrease to $0.56.


Houston’s city tax rates are based on a cap approved in 2004 that limits annual property tax revenue to the combined rates of population growth and inflation, or 4.5%, whichever is lower. This year the tax rate will be cut by 3.4%.


Mayor Sylvester Turner said he supported the tax cut in order to comply with the revenue cap, though he opposed cutting revenue at a time when firefighters are demanding pay raises and the city needs more police officers.




The Texas Legislature provided additional state funds and reformed how public schools are financed allowing districts to cut their property tax rates in exchange for more support from the state.


HISD is expected to receive more revenue under the change next year due to increased state funding and a reduction in its recapture payment. Under the “Robin Hood” school finance system, tax dollars from districts with high property values, like HISD are shared with other districts in the state with less property tax wealth.


Many school district tax rates will decline in 2019. HISD trustees are expected to lower the school property tax rate by 5.8%.




The proposed tax rate changes for the three taxing units in Houston should result in a rate reduction of about 7.5 cents or roughly 3% less than the 2018 tax rate total.