Property Insurance Relief Homestead Exemption Non-school Property Tax

Summary — HJR 209: Property Insurance Relief Homestead Exemption (Joint Resolution)

Status: Added to State Affairs Committee agenda (11/25/2025)

Introduced: March 14, 2025

Sponsor: Rep. Busatta

Type: Joint resolution proposing constitutional amendments (Article VII §6; new Article VIII §7)

Next major step: Voter referendum at the 2026 general election (requires 60% approval); if approved, effective January 1, 2027 (first applies to the 2027 tax roll)

Main purpose

HJR 209 would place a constitutional amendment on the 2026 ballot to (1) expand a homestead property tax exemption for insured homeowners for non‑school property taxes, and (2) restrict local governments from reducing law‑enforcement funding below a defined base year level.

Key provisions

• Homestead exemption change (Article VII, §6):
  • Creates an alternative "second" homestead exemption for homestead properties that carry comprehensive homeowners insurance.
  • Replaces the current additional $25,000 second exemption (which applies to assessed value between $50,000 and $75,000) with a larger exemption of $200,000.
  • The $200,000 exemption would apply to assessed value between $25,000 and $250,000 (amounts adjusted annually for inflation).
  • The exemption would apply to all ad valorem taxes except school district taxes (i.e., counties, municipalities, and special districts).
• Law‑enforcement funding safeguard (new Article VIII, §7):
  • Prohibits local governments from reducing funding for law‑enforcement services below the amount provided in either Fiscal Year 2025–26 or FY 2026–27, whichever is higher.

Who would be affected

• Primary beneficiaries: homestead property owners with comprehensive homeowners insurance (for non‑school property tax savings).
• Fiscal impact on: counties, municipalities, and special districts that levy non‑school property taxes (reduced property‑taxable base and local revenues).
• School district property tax revenues: explicitly not affected by the exemption change.

Fiscal impact and timing

• Legislative staff and the Revenue Estimating Conference (REC) estimate large negative impacts on local non‑school property tax revenue if voters approve the amendment.
  • REC (assuming current millage rates): estimated negative cash impact of $6.6 billion and a negative recurring impact of $8.6 billion beginning in FY 2027–28.
• The precise fiscal effect depends on voter approval, millage adjustments, and implementation details.
• If voters approve in 2026, the amendment becomes effective Jan 1, 2027 and first affects the 2027 tax roll.

Procedural notes

• As a joint resolution proposing a constitutional amendment, HJR 209 required a three‑fifths vote of each legislative chamber for final passage in the Legislature.
• To become effective, the proposed amendment must be approved by at least 60% of voters in the 2026 general election.
• The joint resolution is not subject to the Governor’s veto.

Legislative actions (selected)

• Favorably reported as CS by the Select Committee on Property Taxes (24 Y — 10 N) on 11/20/2025.
• Referred to State Affairs and Ways & Means committees; added to State Affairs agenda 11/25/2025.

For readers seeking deeper detail: the text modifies Article VII, Section 6 (homestead exemptions) and adds a new Article VIII, Section 7 (law‑enforcement funding floor). The revenue estimates cited assume current millage rates and would vary with local tax policy changes.