Earlier this year, the 83rd Texas Legislature passed joint resolutions to place the amendments on the ballot. The proposed changes cover a range of issues including taxation and management of the state’s water resources.
...Early voting begins Monday, and the general election is Nov. 5.
Also on the ballot in Lampasas County will be a tax freeze proposal for homeowners 65 and older.
And county voters who live within Copperas Cove city limits will elect city officials and vote on a proposed city bond.
Text of the constitutional amendments is listed below, along with arguments for and against each measure, as compiled by the Texas Legislative Council and the House Research Organization.
These amendments will become part of the Texas Constitution if a majority of voters approve the propositions.
“The constitutional amendment authorizing the legislature to provide for an exemption from ad valorem taxation of all or part of the market value of the residence homestead of the surviving spouse of a member of the armed services of the United States who is killed in action.”
Summary: This proposed amendment would allow the surviving spouse of a member of the armed forces who was killed in action to be exempt from paying local property taxes based on all or part of the total appraised value of the homestead.
A surviving spouse would be eligible if he or she has not remarried since the death of the service member. The surviving spouse could transfer the exemption to a new homestead, but it would be limited to the dollar amount of the prior homestead exemption.
Arguments for: A tax exemption already exists for spouses of totally disabled service members, and spouses of those killed in action deserve the same benefit. The tax exemption would provide financial relief for surviving families who have suffered the loss of their loved ones.
Arguments against: The proposed amendment excludes others who deserve similar tax exemptions. Also, as more property owners receive property tax exemptions, local governments may have to raise taxes on other property owners. In addition, local governments would lose revenue, especially in cities where military families make up a large part of the population.
“The constitutional amendment eliminating an obsolete requirement for a State Medical Education Board and a State Medical Education Fund, neither of which is operational.”
Summary: H.J.R. 79 repeals a now-obsolete constitutional provision added in 1952. The medical board was not created until 1973, and was deemed ineffective in serving its purpose of attracting physicians to medically under-served communities. The board has not received state appropriations or issued new loans for more than 25 years.
Arguments for: The proposed amendment would shrink state government and simplify the Texas Constitution by eliminating an unused government office.
Arguments against: Because the Medical Education Board and its education fund are obsolete, a constitutional amendment to remove references to them is unnecessary.
“The constitutional amendment to authorize a political subdivision of this state to extend the number of days that aircraft parts that are exempt from ad valorem taxation due to their location in this state for a temporary period may be located in this state for purposes of qualifying for the tax exemption.”
Summary: The Texas Constitution allows local taxing authorities to exempt from ad valorem taxation certain property that is in Texas temporarily. This is referred to as “freeport exemption” and has a 175-day limit on how long the property may be held in inventory to retain tax-exempt status.
Eligible property includes aircraft and aircraft parts used for maintenance and repair by certified air carriers. It is not unusual for airplane parts to sit in a warehouse for 600 days, however.
The proposed amendment would authorize governing bodies to extend the freeport exemption up to 730 days after acquisition. If passed, the amendment would apply only to tax years that begin on or after Jan. 1, 2014.
Arguments for: Because aircraft parts generally are stored for longer periods of time than the 175-day limit, Texas parts suppliers are disqualified from the tax exemption, which puts them at a disadvantage compared to suppliers in other states where goods destined for out-of-state shipment are exempt from property taxes. This hurts the Texas aviation industry.
The proposed freeport extension would help make Texas more competitive in the aerospace industry. Granting an extension would remain at the option of each local government entity.
Arguments against: Questions remain about the cost of the amendment to local and state government bodies because of the difficulty in determining the value of parts that would be exempt. Also, singling out one group for tax exemption is unfair to other groups that have to pay full taxes. Instead of granting extensions to the freeport exemption, the legislature should consider eliminating the antiquated inventory tax.
“The constitutional amendment authorizing the legislature to provide for an exemption from ad valorem taxation of part of the market value of the residence homestead of a partially disabled veteran or the surviving spouse of a partially disabled veteran if the residence homestead was donated to the disabled veteran by a charitable organization.”
Summary: Passage would authorize a new exemption from property taxation of a percentage of the market value of a partially disabled veteran’s homestead equal to the percentage of the veteran’s disability if the home were donated at no cost to the veteran by a charitable organization.
Arguments for: Charitable organizations honor disabled veterans by donating homes, but the home may become a burden if the recipient cannot pay the resulting tax payments, especially if the veteran is unable to work. The cost of the exemption is small, because few homes are donated cost-free to disabled veterans.
Arguments against: If the purpose is to help disabled veterans keep their homes while they are unable to pay taxes, the exemption should expire when the veteran can afford to pay taxes and should not be permanent.
“The constitutional amendment to authorize the making of a reverse mortgage loan for the purchase of homestead property and to amend lender disclosures and other requirements in connection with a reverse mortgage loan.”
Summary: A reverse mortgage is a loan made on the basis of equity in the borrower’s homestead. Repayment of reverse mortgages does not begin until the homeowner dies, sells, or moves out of the residence. At that time, the home often is sold, and the proceeds are used to pay off the loan.
Texas is the only state in which seniors cannot get reverse mortgages for home purchases. Currently, seniors have to purchase a home with a conventional mortgage and then take out a reverse mortgage on equity in the new home. This two-step process can be cumbersome and costly.
Proposition 5 would allow Texas seniors ages 62 and older to use a reverse mortgage to acquire a new residence. It also would require mortgage lenders to expand counseling to borrowers to include disclosure of specific behaviors that can lead to foreclosure on a property.
Arguments for: By allowing senior homeowners to sell one property and purchase another in a single transaction, the proposed amendment could save homeowners thousands in closing fees. Amending lender disclosure requirements also could give prospective borrowers more information to make an informed decision. And reverse mortgages usually are easier to qualify for than traditional loans.
Arguments against: Homeowners could lose a lifetime of home equity as a result of fraud, scams, misleading advertising, aggressive sales tactics and discriminatory practices sometimes associated with reverse mortgages. Reverse mortgages are complex financial products that many consumers struggle to understand even after required counseling. Loosening restrictions by allowing reverse mortgages for home purchases could leave seniors with greater debt than equity in their homes and make them more vulnerable to financial difficulties.
“The constitutional amendment providing for the creation of the State Water Implementation Fund for Texas and the State Water Implementation Revenue Fund for Texas to assist in the financing of priority projects in the state water plan to ensure the availability of adequate water resources.”
Summary: The proposed amendment would create two special funds outside the general revenue fund. They would be administered by the Texas Water Development Board and used for the purpose of implementing the state water plan.
These special-purpose funds would be capitalized by a onetime transfer of $2 billion from the economic stabilization fund – often called the state’s Rainy Day Fund.
Arguments for: Given the current drought and the state’s growing need for water, it is appropriate to finance water infrastructure through money from the economic stabilization fund, which was created for emergencies such as drought. Such use from the fund will neither harm the state’s credit rating nor hinder Texas’ ability to respond to future emergencies.
Arguments against: Funding should come from the general revenue fund and not from the Rainy Day Fund. Drawing down this fund could hurt the state’s ability to respond to future emergencies and could result in a credit downgrade. Two constitutionally dedicated water development funds already exist, with financial assistance programs available for water infrastructure. The state should not serve the role of a commercial investment banking broker.
“The constitutional amendment authorizing a homerule municipality to provide in its charter the procedure to fill a vacancy on its governing body for which the unexpired term is 12 months or less.”
Summary: Currently, the Texas Constitution prohibits the appointment of a person to fill a vacancy on a governing body for which the unexpired term is less than a year. It requires the vacancy to be filled by the majority vote at a special election within 120 days of when the vacancy occurs, regardless of how much time is left in the official’s term.
Arguments for: State regulations put an unnecessary burden on home-rule cities by requiring them to hold special elections to fill a vacancy, costing both the municipality and taxpayers. These cities should be allowed to determine their own procedure for filling vacancies.
Arguments against: If municipalities determine their own procedure for filling vacancies, they may make appointments instead of holding elections, which takes power away from voters. It could make local government more vulnerable to corruption by allowing city officials to appoint political allies.
“The constitutional amendment repealing Section 7, Article IX, Texas Constitution, which relates to the creation of a hospital district in Hidalgo County.”
Summary: The proposal would repeal a constitutional limit on the property tax rate that a hospital district could levy in Hidalgo County. The limit – 10 cents per $100 valuation – is much lower than the rate available to other hospital districts in the state, which are authorized to levy up to 75 cents per $100 valuation.
Hidalgo County is one of the largest counties in the nation without a hospital district. The tax limitation may not provide adequate funding to create and support a functional hospital district. If the amendment passes, voters in Hidalgo County still would need to approve the formation of a hospital district.
Arguments for: The Texas Constitution currently makes the creation of a hospital district in Hidalgo County impractical by limiting the property tax rate that a district could levy there. Adopting the amendment would improve access to health care, especially for the poor. The change would maintain local control by requiring Hidalgo County voters to approve the hospital district and adoption of the related tax rate.
Arguments against: If the current regulation is repealed, Hidalgo County voters could approve a higher tax rate for a hospital district in the county, since the 10 cent per $100 valuation limit would be removed. An increase in property taxes would hurt the people that the proposition was intended to help: the poor.
“The amendment relating to expanding the types of sanctions that may be assessed against a judge or justice following a formal proceeding instituted by the State Commission on Judicial Conduct.”
Summary: The state constitution authorizes the State Commission on Judicial Conduct to issue certain types of sanctions against a judge or justice of a court, after a formal disciplinary proceeding. The proposed amendment expands the sanctions available by authorizing the commission to issue an order of public admonition, warning, reprimand, or requirement that the judge or justice obtain additional training or education.
Arguments for: Limiting the scope of disciplinary measures that can be issued in formal procedures discourages the state commission from pursuing important cases in an open setting. The proposed change would allow the commission to use a full range of sanctions, and would increase accountability for judges and justices. Possible sanctions would encourage the judiciary to maintain high standards of conduct both on and off the bench.
Arguments against: Provisions that restrict potential action by the State Commission on Judicial Conduct are appropriate because they help ensure that formal proceedings are used only in the most serious cases of alleged judicial misconduct. Stronger measures than those provided by Proposition 9 are needed to reinforce the SCJC ‘s authority to discipline judges and hold them accountable.
ALSO ON THE BALLOT
The Nov. 5 election will include a measure for Lampasas County voters on “Adoption of a ceiling or limitation on the county tax levy of a person who is sixty-five (65) years of age or older who receives a homestead exemption.”
Copperas Cove Voters
Those Lampasas County voters who reside within the Copperas Cove city limits will have an additional proposal on their ballots:
Proposition: Fire Station #4/
“The issuance of $6,000,000 general obligation bonds for acquiring, constructing and equipping a fire station/police substation and acquiring land necessary thereof, and the levy of a tax in payment thereof.”