REVENUE CAPS and APPRAISAL CAPS Effects on County Government TRUE OR FALSE? Currently there is no appraisal cap on residential homesteads? FALSE The current appraisal cap on residential homesteads is 10%. What is an Appraisal Cap? • Limitation on the amount property values can rise each year. • Currently, the taxable value of a homestead before exemptions cannot rise by more than 10% per year regardless of market value. • Recent proposals would change this cap to 3%, 5% or a local option. The Results • Appraisal Caps shift the tax burden from high growth areas of the county to areas where values stay the same or go down. • Everybody else picks up the tax burden for the few people who benefit. If your home value is not increasing, your taxes will increase to compensate. TRUE OR FALSE? Texas counties currently have a revenue cap. TRUE What is a Revenue Cap? • Limit on the amount of additional tax revenue that can be raised. • Currently counties have an 8% cap – exceeding the cap can trigger a rollback election. Expensive! (Travis County cost for a county wide election is $1million) • Recent proposals would change this cap to a population growth plus inflation factor, 3%, or 5%. Total Property Tax Levy 2004 Special Districts 11% Counties 14% Cities School 15% Districts 60% Data Source: Texas Comptroller of Public Accounts Denton County FY1995 to FY2005 Population (County) 66.5% Inflation 28.1% Juvenile Probation/Detention 495.4% Debt Service 348.2% Repairs and Maintenance 73.9% Utilities 136.6% County Jail (does not include Jail Health) 126.8% Emergency Medical Services 68.6% Juvenile Medical Expense 92.4% Employee Health Insurance 317.2% Indigent Attorney Fees 234.6% Sheriff's Dept Medical Care (Jail Health) 168.4% Fuel Costs 123.6% 0% 100% 200% 300% 400% 500% 600% Travis County FY1994 to FY2005 Population (County) 37.2% Inflation 31.8% Fuel Expenditures 180.8% Sheriff's Office Medical Care 52.4% Indigent Attorney Fees 111.1% Employee Health Insurance 429.2% Juvenile Medical 515.3% Emergency Medical Services 709.7% 0% 100% 200% 300% 400% 500% 600% 700% 800% Jasper Co. Revenues ‘06 Fines, Fees and Grants and Charges for Intergovernmental Services Reimbursements 17.5% 2.6% Investment Earnings 0.6% Miscellaneous 1.1% Property Taxes 78.1% Jasper Co. Expenditures ‘06 Community and Economic Health and Human Development Infrastructure and Services 1.05% Environmental 2.01% Services Public Safety & 21.85% Corrections 31.27% General Administration Elections 13.24% 0.77% Financial Judicial Administration 21.56% 8.25% $326,488 Impact 3% Revenue Cap => Revenue Loss => CUTS TO SERVICES Commissioners Court must make a decision regarding a cut in services to cover the budget deficit. $326,488 is equivalent to the following budgets: Emergency management Sheriff patrol Healthcare unit Senior citizens services Child foster care Public library Historical commission Mandatory vs. Discretionary (Required vs. Optional Services) Which of the following services that county government provides are mandatory? A. Employee Health Insurance/Retirement B. Emergency Medical Services C. Sheriff’s Patrol D. None of the Above Jails Mandatory Discretionary Meals Quality and Quantity of Meals Medical Treatment Level of Medical Care; Dental Staff Care Facilities Rehabilitation Programs Access to Legal Work Programs Transportation Victim/Witness Secure Equipment Telecommunications Commissary Training Judicial System Mandatory Discretionary Courts-staff, equipment, CSCD-level of rehabilitative facilities programs Indigent legal services Juvenile Probation-level of Court Administration rehabilitative programs Clerks-record keeping Constable-service of process Sheriff-service of process Sheriff-juror & bailiff duties CSCD-facilities and communication infrastructure Juvenile Probation Public Health and Safety Mandatory Discretionary Indigent Medical Level of medical services Indigent Burials Poverty level of citizens Mental Health-jail served Hospital (some Environmental/sanitation circumstances) services Sheriff-suppress crime and Emergency Medical arrest offenders Services Homeland Security-various Level of enforcement offices Level of preparedness Victim Notification Fire Marshall Public Welfare and Personnel & Benefits Mandatory Discretionary Roads (current) Roads (new) Sheriff-estray Parks Retirement (existing Library programs) Event arenas Salary (minimum wage) Nuisance abatement Personnel/payroll Family services recordkeeping Elder services Worker’s Compensation Community development Retirement (new employees) Salary (position appropriate-market) Medical benefits Conclusion • The purpose of this presentation is to help you better understand what the effects of caps are and how they could affect you. • The truth is county government already operates under an 10% appraisal cap and an 8% rollback rate.