THE BLOG

Taxation in Rick Perry's Texas

01/21/2014 11:54 am ET | Updated Mar 23, 2014
  • James Moore Best selling author, TV political analyst, communications and public relations expert

Everybody moving into Texas, and even people who have been living here a long time, needs to be educated about education in this state. Especially how it's paid for. Or more accurately, isn't paid for.

Basically, your property taxes on your house fund Texas schools. And just about everything else, including the local junior college and hospitals. But, as tends to be the case in Texas politics and law, there's always a nice workaround so elected types don't get hurt when your taxes go up.

The state constitution mandates that the government "shall provide" a good and equal education for all of its citizens, which, of course, it doesn't and never really has. The inequity occurs because the property taxes to fund local schools don't come from communities of equal value. That means, historically, if you grow up in Highland Park in Dallas, you are going to attend a school that has a TV studio, a big stadium, well-paid teachers, and computers. But if your daddy and momma are farm workers and you had the misfortune to be born in Pecos, things aren't looking so good.

There was an attempt at redistribution in a plan called "Robin Hood," but it's not exactly working out like envisioned. And the legislature doesn't like raising money to pay for anything. That's called taxation. It gets you unelected. Instead, they celebrate clowns like Texas Governor Rick Perry when he cuts $5 billion from education funding and forces out 10,000 teachers and makes schools charge parents for bus transportation, debate team dues, band fees, and even football gear. Isn't adding costs to football going just a bit too far in Texas? The Friday Night Lights will flicker if we do not take a stand now!!!

So, here's what happens when the weak-willed at the capitol fail at their jobs, which, it needs to be pointed out, is a dependable outcome of every legislative session. Texas has been in a lawsuit over public education since 1968 when Rodriguez v. Board of Education was filed. Hell, since 1984 alone the state has lost five major decisions in education lawsuits and has another one before the Texas Supreme Court after a judge earlier ruled that schools were funded in an "inadequate, inequitable, and unconstitutional way."

Which means using your property taxes and distributing them unfairly.

When the governor and the legislators abdicate their responsibility at the capitol (as dependable as 100 degrees on a July day in Texas), the pressure gets forced down to the local school district to come up with the money. What's that mean? It means the political heat gets faded to your local school administrators who are often forced to hold Tax Ratification Elections and ask already overtaxed homeowners to pay more for schools because the goddamned legislature didn't do its job.

One lawmaker, typically oblivious to his own hypocrisy, suggested in the last session that school districts "conduct a good exercise in democracy" by holding the elections. Republican Steve Ogden somehow missed the fact that they had already done that by voting to send him to the legislature to figure out a way to pay for schools. Districts have to conduct these TRE's to tax homeowners at a rate above $1.04 per $100 of valuation and nobody can go above $1.17 by law. At last report about 20 percent of Texas districts were holding elections or had already gotten results. And, whenever they need new buildings for quickly growing schools, boards will float bonds that local taxpayers need to retire, too, because the legislature won't... well, I'm sure you've picked up the pattern by now.

And who, in good conscience, can vote against the kids. Well, yeah, legislators but they are demonstrably lacking in human genetics.

This is an insane way to conduct business. And the pressure is on property taxes because Texas lacks both a personal or corporate income tax. But, it's so much worse than just that. Not only do we not tax corporations in a meaningful way, we absolve them, for the most part, from the taxing responsibilities carried by homeowners. Corporations relocating to Texas get their land and facilities exempted most of the time from the tax rolls because, you know, they need to get going and create jobs (which don't pay enough for people who own homes to afford their property taxes).

There are billions of dollars in untaxed corporate real estate all across Texas that would solve educational funding problems with even a very low rate of taxation.

The only real tax on corporations in this state is a 1 percent gross margins tax, minus the cost of goods, which means, even if you aren't an accountant or tax consultant, it doesn't take much of a deduction process to make that one percent disappear.

So, they generally pay no property taxes because of exemptions, the margins tax is symbolic nonsense that does nothing for the state's coffers, and there is no corporate or personal income tax, therefore, my neophyte Texan, your property taxes are going to be ridiculous. Depending on the school district, you can expect that $250,000 dream house you had envisioned to cost you around $500 a month in property taxes. Yeah, that's right. If you paid cash for those new digs, you'd still be giving Rick Perry and the legislature $500 a month just to live in your house and so they wouldn't have to suffer the political misfortune of figuring out how to honestly and fairly pay for public education in Texas.

Oh, I should mention that we don't just give corporations huge property tax exemptions and protect them from the horrors of an income tax on their earnings; we also give them large chunks of money to help them move to Texas so they won't be hurt by the costs of relocation. Isn't that nice of us? The governor will have given away $508 million from the Texas Enterprise Fund before he leaves office. But it goes to companies that really need it, like Chevron Oil, which received $12 million. Perry even gave, probably accidentally because he isn't this smart, more than a million dollars to CGI, the Canadian company that built the crappy website that nearly brought down Obamacare.

Just so you know before you get here: We are great with corporate welfare in Texas. But if you can't get a job, or are sick, or your kids are hungry, or you are sleeping in your car because things didn't work out quite the way you thought they would, we're sorry.

But this is Texas and you're on your own.

Also at: http://www.dontgrowtexas.com

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