KXAN36, NBC published Nov 6, 2019: Texas voters make it harder for state to implement personal income tax. Wes Rapaport explores what other sources of revenue state leaders could turn to if Texas needs more money.
The Dallas Morning News
written by Maria Mendez
November 5, 2019
AUSTIN — Texans, who already don’t pay a statewide income tax, voted Tuesday to make it even more difficult for state leaders to ever impose the tax on them in the future.
The constitutional ban passed overwhelmingly, with Gov. Greg Abbott issuing a statement in praise of the vote.
“Today’s passage of Prop 4 is a victory for taxpayers across the Lone Star State," Abbott said in a statement. "I am grateful to Rep. Jeff Leach for his bold leadership on this issue, and for the overwhelming majority of Texans who voted to ensure that our great state will always be free of a state income tax. This ban on such a disastrous tax will keep our economy prosperous, protect taxpayers, and ensure that Texas remains the best state to live, work, and raise a family.”
Voters also approved eight of nine other constitutional amendments, ranging from a measure that will increase school funding allocations to another that will allow law enforcement dogs and horses to be adopted by their handlers.
The approved constitutional amendments will go into effect once the unofficial results are confirmed by the secretary of state.
Prohibiting a state income tax
Texas is one of seven states without an income tax. The state and its local governments derive most of their revenue to fund services like health care and education from sales taxes and property taxes. Republican leaders in Texas have historically touted the lack of an income tax as a conservative bona fide and part of a key attraction for businesses.
Leach, R-Plano, authored the legislation for Proposition 4 to ensure the state income tax stays off the table in Texas.
With its passage, two-thirds of the Texas House and Senate will be required to vote to repeal the amendment and call a statewide election to establish an income tax.
Leach has said his proposition makes a state income tax “virtually impossible,” keeping Texas friendly for businesses and residents.
“The enactment of Proposition 4 is a monumental victory for the Texans of today and for future Texans of tomorrow,” Leach said. “Tonight we heard loud and clear from Texans that they know how to spend, save and steward their money far better than any politician in Austin. Because of their voices and their votes, every Texan can rest easy knowing that our Constitution now ensures their hard-earned paychecks are protected from a future state income tax.”
The proposition replaces the “Bob Bullock” amendment, which allowed the Legislature to impose a personal income tax only if voters approved it in a statewide referendum and if the new revenue funded school property tax cuts and education programs. That previous amendment had been in place since 1993, when voters approved the proposition pushed by then-Lt. Gov. Bob Bullock, a Democrat.
But the Center for Public Policy Priorities and the Texas State Teachers Association have said the proposition eliminates a potential source of revenue for public education funding and property tax relief, which were priorities during the last legislative session.
“Texas is growing rapidly, and we need ways to meet our growing educational, health care and transportation needs,” said Ann Beeson, CEO of the Center for Public Policy Priorities. “Proposition 4 was completely unnecessary, but more lawmakers wanted to score political points by putting this in front of voters rather than make serious decisions about funding our future."
The proposition also faced pushback in the Legislature, where it was narrowly approved. Before the measure was placed on the ballot, it required two-thirds passage from the House and the Senate this summer.
Dallas Sens. Royce West and Nathan Johnson tried to preserve language that the income tax ban would apply to “natural persons” and not “individuals.” They cautioned that using “individual” could exempt corporations. Their effort failed, but the Legislature did amend the tax code to define an “individual” as a “natural person."
The rest of the ballot
Among the other nine propositions, only Proposition 1 failed Tuesday night. The measure would have allowed voters to elect municipal judges to serve in multiple cities at the same time. The 95% of municipal judges in Texas who are appointed by city councils are already allowed to serve in more than one office.
Here are the rest of the propositions that passed:
- Proposition 2 would allow the Texas Water Development Board to issue additional bonds, which would not be allowed to exceed $200 million, to fund water supply and sewer service projects in areas where the median household income falls below 75% of the state median income level.
- Proposition 3 would temporarily exempt property owners in a governor-declared disaster area from a portion of the taxes for the property’s appraised value.
- Proposition 5 ensures that all revenue from state sales taxes imposed on sporting goods goes to the Texas Parks and Wildlife Department and the Texas Historical Commission to maintain the state’s parks and historical sites.
- Proposition 6 would allow the Legislature to increase from $3 billion to $6 billion the amount of taxpayer-backed bonds the state issues for the Cancer Prevention and Research Institute of Texas. The agency, established in 2007, would otherwise lose its ability to award grants that promote cancer prevention and research by 2022.
- Proposition 7 would double the annual public education funding awarded to the Available School Fund. The General Land Office can currently distribute $300 million to the fund per year, which gives schools funding for each student and textbooks.
- Proposition 8 would create a Flood Infrastructure Fund in the state treasury for the Texas Water Development Board to pay for drainage, flood mitigation and flood control projects.
- Proposition 9 would exempt precious metals from ad valorem taxes if they are held in a Texas depository.
- Proposition 10 was garnering the largest approval vote of the night. The amendment would ensure that retiring law enforcement animals, such as dogs and horses, can go to their handlers or qualified caretakers without having to be auctioned off.
KETK NBC published Aug 15, 2019: Republican Governor of Texas, Greg Abbott, speech on Proposition 4 to voters, "Help drive a stake through the heart of Texas ever having an income tax."
KXAN36, NBC published Oct 16, 2019: Prop 4 would make it harder for Texas to implement personal income tax. KXAN's Steffi Lee explains that it's a question voters will decide in November.
KSAT.com, ABC12, San Antonio local
written by Alex Samuels, Texas Tribune
November 6, 2019
AUSTIN – Amendments to the state constitution that would make it harder to enact a state income tax, stabilize funding for state parks and allow retired law enforcement animals to be adopted by their handlers received wide support from voters Tuesday.
Supporters of one of the most contentious issues on the ballot — Proposition 4 — proclaimed victory within hours of the polls closing, with about three fourths of voters supporting the proposal in early voting returns. The proposition authored by state Rep. Jeff Leach, R-Plano, and state Sen. Pat Fallon, R-Prosper, eliminates the possibility of Texas imposing an income tax unless the state changes its constitution again.
The proposal drew ire from left-leaning groups including the Center for Public Policy Priorities, which spent thousands to defeat it. On Election Day, the group ran digital ads in “targeted areas of the state” and sent out two mail pieces to tens of thousands of Texas households, according to a spokesman for the group.
(Republican) Governor Greg Abbott declared an early victory on the proposition in a statement Tuesday evening.
“Today’s passage of prop 4 is a victory for taxpayers across the Lone Star State,” he said. “I am grateful to Representative Jeff Leach for his bold leadership on this issue, and for the overwhelming majority of Texans who voted to ensure that our great state will always be free of a state income tax. This ban on such a disastrous tax will keep our economy prosperous, protect taxpayers, and ensure that Texas remains the best state to live, work, and raise a family.”
The only item on the ballot that looked as though it might not pass was Proposition 1, which would permit elected municipal court judges to serve multiple municipalities at the same times. With votes still being counted late Tuesday, returns indicated that it had received just over one-third of the vote.
The other propositions were poised to pass easily. Proposition 5 would stabilize funding for state parks and received overwhelming support. The proposition allows money accumulated from existing sales tax on sporting goods to be used for the Texas Parks and Wildlife Department and the Texas Historical Commission. Current law allows the Legislature to allocate that money however they see fit.
Proposition 10, which had the highest level of support, amends the state constitution to allow retired service animals, such as dogs or horses, to be adopted by their handlers or other qualified caretakers. These animals are currently classified as surplus property or salvage and can be “auctioned, donated or destroyed.”
Proposition 6, which allows for an increase of bonds allocated to the Cancer Prevention and Research Institute of Texas received nearly two-thirds support, according to unofficial results.
Voters were also overwhelmingly in favor of Proposition 8 which would set aside $800 million from the state’s rainy day fund for flood mitigation efforts. The amendment was approved by the Legislature following Hurricane Harvey’s devastation along the Texas coast. The proposition netted about three-fourths of the vote, according to unofficial results.
Another Harvey-related item, Proposition 3, also passed easily. The ballot initiative allows the Legislature to provide temporary tax breaks for people with property damaged in governor-declared disaster areas. The resolution and its legislation were approved by the Legislature unanimously earlier this year.
Turnout in constitutional amendment elections is historically low. In 2013, only 1.1 million voted. In 2011, only 690,052 Texans showed up — of the 12.8 million who were registered to vote at the time — to vote on 10 amendments.
Any changes to the Texas Constitution must be approved by a majority of Texas voters. Getting a proposed amendment on the ballot requires support from more than two-thirds of both chambers of the Legislature.
In addition to the constitutional amendments, Harris County voters had several other contentious elections on the ballot, including its mayoral race, city council elections and a state House special election.
Disclosure: Center for Public Policy Priorities has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.
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