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HB 97

Relating to reducing school district maintenance and operations ad valorem taxes through the use of certain surplus state revenue.

89th Legislature, 2nd Called Session (2025) Introduced by Helen Kerwin and 1 co-sponsor

HB 97 redirects Texas state budget surpluses to reduce school district property tax rates, shifting education funding from local to state revenue sources during surplus years.

Referred to Ways & Means
#comptrollerofpublicaccounts(v2608) #educationagency #texas(v9941) #education #commissionerof(v9954) #education--primary&secondary--finance(i0250) #foundationschoolprogram(s0541) #statefinances--management&control(i0748) #taxation--property-appraisals&appraisaldistricts(i0792) #taxation--schooldistrict(i0785)
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Bill Summary · HB 97

Legislative bill overview

HB 97 proposes to reduce school district maintenance and operations (M&O) ad valorem taxes by directing surplus state revenue toward offsetting these local property taxes. The bill would use state budget surplus funds to provide tax relief at the local level, reducing the property tax burden on school district taxpayers.

Why is this important

Property taxes fund a significant portion of Texas school district budgets, and reducing M&O tax rates directly affects homeowners' annual tax bills and business operating costs. This mechanism would shift some school funding burden from local property taxation to state general revenue, which has broader implications for school funding equity and state budget priorities during surplus periods.

Potential points of contention

  • School funding stability: Using one-time surplus revenue for ongoing tax reduction could create budget gaps in future years when surpluses don't materialize, potentially destabilizing school district finances
  • Revenue allocation priorities: Debate over whether surplus state revenue should fund tax relief, education programs, infrastructure, or other state needs competes with school district preferences
  • Funding equity: The mechanism may disproportionately benefit property-wealthy districts or homeowners in high-value areas, potentially widening disparities between resource-rich and under-resourced school districts

Compiled from official sources — confirm details with the bill’s official record.

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