Dallas City Wire

The Dallas Independent School District (ISD) property tax is surpassing the recommended growth rate, at a time when property taxes have become a controversial issue in Texas, drawing bipartisan support for relief.

A report issued by the Texas Public Policy Foundation (TPPF) in February of 2022 demonstrates property tax increases for Texas' largest school districts when compared to the tax's preferred growth rate, which is a combination of inflation plus population growth. The property tax in almost all ISDs exceeded the ideal rate of growth. Katy and Conroe ISDs were the only ones to show a decrease.

"If left unchallenged, these value increases have the potential to really take a bite out of taxpayers over the long-haul,” TPPF’s Policy Director James Quintero said in a newsletter addressing property tax appraisals and how to show opposition to them. “Taxpayers should be prepared to defend their wallets this year—first by protesting their property tax appraisals and then by pressuring their local elected officials to adopt lower tax rates.”

Quintero also discussed how this impacts local governments. 

"It’s not a stretch to say that property taxes are out of control in the Lone Star State," Quintero said. "As a result, local governments are getting rich while families are forced to make hard decisions."

Dallas ISD's property tax increased by 40% from $1.3 billion to $1.8 billion from 2016 to 2020, according to a TPPF report. The combined population and inflation for the city went up by 4.8% during that time, totaling a difference of 35.1%.

According to TPPF's "Just the Facts, Property Taxes in Texas’ Most Populous Cities, Counties, and School Districts" second edition, by Quintero and Anthony Jones published in February of 2022, property taxes are different in a variety of ways. The report describes property taxes are “the largest tax assessed in Texas," according to the Comptroller. In 2019, nearly half of all tax dollars collected in Texas came from property taxes. According to the report, there were 4,256 different property taxing units in Texas in the fiscal year of 2019, some of which overlap. 

"The laws and systems surrounding Texas’ property tax are very complex, oftentimes requiring a taxpayer to seek help through consultants, accountants, advocates and attorneys," the report said. 

Consequently, Texas was ranked as the state with the 10th highest property taxes with a median payment of $4,065 per year, according to The Balance. Other studies have Texas ranked higher with The Tax Foundation placing the state sixth in 2021 based on the tax burden for 2019. 

The report also said that in 2019, the 86th Texas Legislature passed House Bill 3 (2019), which made significant alterations to the school finance system. One major difference is that school districts are now mandated to carry out efficiency audits “before a district seeks voter approval for increasing tax rates."

According to state law, an efficiency audit is “an investigation of the operations of a school district to examine fiscal management, efficiency and utilization of resources.”