SAN ANTONIO – This is a developing story and will be updated online and on air.
Homeowners in San Antonio should see the city portion of their property tax bills stay the same — or even go down — this year after council increased the value of its homestead exemptions.
In a unanimous vote of the 10 members present Thursday morning, San Antonio City Council approved raising the homestead exemption from the minimum 0.01 percent, or $5,000, up to 10 percent of a home’s value.
They also increased the exemption for disabled homeowners from $12,500 to $85,000 and the exemption for seniors from $65,000 to $85,000.
The exemptions reduce the taxable value of a person’s primary home, which, in turn, reduces the homeowner’s tax bill.
The city also plans to lower its tax rate later this year, which would affect all properties in the city.
City staff said the property tax relief efforts should offset the effect of skyrocketing home values this year, since the taxable values of houses with registered homestead exemptions can only go up by 10 percent annually.
While the tax break comes amid a time of rapid inflation and rising housing costs, it was also a step the city was arguably forced to take by law.
State law caps how much additional property tax revenue cities may take in compared to the previous year. The property tax revenue the city takes in for maintenance and operations can only grow by 3.5 percent, excluding new construction.
If the city adopts a tax rate that would put it above that cap, it would trigger an automatic election on that tax rate, under the state law.
Since city staff currently estimates a 14.1 percent increase in taxable value this year – the tax rolls are not yet finalized – the city had to find a way to cut how much property tax revenue it would tax.
The various increased homestead exemptions would take a chunk out of the city’s property tax revenue above the state-imposed cap, and an estimated 1.3 percent reduction in the tax rate is expected to take care of the rest.
Bexar County commissioners provided their own tax break for homeowners on Jun. 7, raising the county’s homestead exemption to the maximum 20 percent less than three months after they put the bare minimum $5,000 exemption in the books.
District 7 Councilwoman Ana Sandoval, who recently gave birth to a daughter, was not present for the meeting.