As if Texans don’t have enough to worry about with the current pandemic and labor market woes, some cities are threatening to make things worse with massive tax increases.
On July 14, the Pflugerville City Council passed a resolution directing the Travis County Tax Assessor-Collector “to calculate the voter-approval tax rate of the City of Pflugerville using the special taxing unit cap rate of 8%,” instead of the new 3.5% limit mandated by Senate Bill 2. Like a handful of other cities, Pflugerville erroneously believes that it can impose huge tax hikes without voter input because of a disaster loophole. But this misinterprets the statute as well as the spirit of the law.
Other top state officials have concluded the same. Just recently, Gov. Greg Abbott said: “I don’t construe the law the same way the [Texas] Municipal League has…I disagree with that, I think the Texas Attorney General disagrees with that legal interpretation.”
Even setting aside the issue of statutory interpretation, it’s irresponsible for any city to threaten taxpayers with a massive tax increase right now. Almost 3 million Texans have filed for unemployment since mid-March and the state’s unemployment is a sky-high 13 percent. The last thing that unemployed and underemployed people need to worry about today is their tax bill going through the roof (again).
That’s especially true when the tax increase itself is not mission-critical. The city of Pflugerville itself admits as much, saying in its FY 2021 Proposed Budget that: “The economic impact of the pandemic to the City has been manageable thus far.”
It’s time for Pflugerville and other Texas cities to change course.