Tax Increase Page

The City of Simonton Doubles the Property Tax Rate from just under 22 cents per hundred valuation to just over 44 cents per hundred valuation.

If you would like to keep the city from raising your property tax 102% – DOUBLE what you paid last year, you can sign the petition in THIS LINK.

To know more detail about how the new tax rate was adopted, you can watch the video, read the article below, or skip to the bottom for the deep dive into the petition process.

by Daniel McJunkin

To learn about potential petition opportunities, skip to the bottom of this article. Links provided.

At the September 8, 2022 Special City Council meeting, the Council approved a doubling of local property taxes by raising the property tax from .219189/$100 valuation to .443954/$100 valuation. 

As a result of the tax increase, an example home with a taxable value of  $350,000 would be taxed at $1553.84 as opposed to $767 if the City Council had kept the rate the same as the prior year. Interestingly, had the City used the “no new revenue” rate of .174604, taxes would have decreased on the same $350,000 home to $611.11.

The reasons given by the city for the need to increase property taxes in such a progressive manner was that the city needed a reset of their tax model in order to pay for road building and repair costs that have gone up, that TxDOT was going to require the City to potentially pay up to half of the $6.4 million dollar cost ($3.2 million) as the city’s contribution in funding the intersection realignment at the intersection of FM 1093 and FM 1489,  to pay for a $200,000 study to pay for a study prior to adopting zoning, to prepare for anticipated development  and costs, and to keep the city from being “rolled over” as development approached.

It should be noted that, according to reports from local government sources outside of City Hall, it is common for TxDOT to request a 10% “match” (not a 50% match as indicated by the Mayor). If this information is correct, the city’s match amount would be in the order of $620,000 – far less – and far more affordable than the $3.2 million dollar figure discussed in the City Council meeting.

The tax disclosure form provided by the City actually anticipated a “No new revenue” rate of $.174604/$100 valuation, which would have significantly lowered the tax rate from the previous tax year of .219189/$100 valuation. However, the city took advantage of a provision of the tax code that allows for the City, which is a “small taxing unit”, to use a newly-coined rate known as the “de minimis” Tax rate. 

The de minimis rate is the sum of a taxing unit’s no-new-revenue M&O rate; the rate that, when applied to a taxing unit’s current total value, will impose an amount of taxes equal to $500,000; and a taxing unit’s current debt rate. In the case of Simonton the de minimis rate would have then capped their “new” tax rate at .642343/$100 valuation, a rate that is virtually triple the prior years’ rate.

At the meeting, members of the City Council acknowledged that they had been advised by their attorney that they should set the tax rate at the maximum – an amount that would have virtually tripled local property taxes. However, council members went on to tell those in attendance that they split the difference by adopting the 44.3954/$100 valuation.

Area residents packed the cramped city council chambers in order to watch the proceedings. Of the multiple residents that spoke during the “Public Comments” period, none of them said that they were in favor of the tax increase and most asked for the tax increase to be spread out over time so that they could adjust their budgets in order to afford the new rate.

In the closing minutes of the meeting, after hearing from those that presented their public comments, the Mayor asked for a motion to adopt  the tax rate of .443954/$100 valuation. She received a motion and a second. One council member who was clearly uncomfortable with the proposed rate unsuccessfully attempted to convince the city council to lower the tax increase to .35 cents per $100 valuation. Significant discussion then ensued regarding the parliamentary protocol for considering the change to the original motion as well as the posting and publishing timelines if a new rate was going to be proposed. In the end, the City Council appeared to have already decided to stick to the original motion and voted in favor of the tax increase by a margin of 4 in favor and 1 opposed.

A Petition Drive Appears to be Possible

The following comes from Denton County, but it does a great job of explaining what taxpayers options are related to the subject of excessive taxation.

“De minimis Tax Rate
New for the 2020 tax year is a third calculation for taxing units with a population of 30,000 or less and is not a school district, water district or special taxing unit. This is a tax rate that is equal to the total of the no-new revenue M&O rate, plus a rate when applied to the taxing unit’s current total value, will create a levy  of $500,000, plus the current debt rate. This tax rate is not utilized by all taxing units.

There are several scenarios that govern the maximum rate a taxing unit may adopt. Generally, if a taxing unit adopts a tax rate that exceeds the voter approval rate but is less than the De minimis rate, the voters in the taxing unit may circulate a petition calling for an election to limit the size of the tax increase.*  If a taxing unit adopts a tax rate that exceeds the voter approval rate and the “De minimis rate, an automatic election must be held.” 
*emphasis added

Do you want to petition for and Election to reduce the tax rate?
Tax payers that are interested in protesting might be consider filling out the form below. It is provided by the Texas Comptroller’s office. Be sure to fill it out completely and correctly so that it is not rejected.

50-862. Petition for Election to Reduce Tax Rate of a Taxing Unit Other than a School District