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Orange County commissioners to debate possible property tax increase

Expenses from Tropical Storm Imelda may allow the county to bypass a new state law capping tax increases at 3.5%

ORANGE, Texas — Orange County commissioners are set propose a possible 8% property tax increase, 12News has learned. 

County commissioners are scheduled to meet at 3 p.m. Tuesday, and the tax increase and public hearing on the increase is on the agenda. 

Orange County Judge John Gothia tells 12News that the county has been hit hard financially by the coronavirus pandemic as well as the devastating impacts from Tropical Storm Imelda nearly a year ago. 

Gothia says county commissioners will be presented with the 2021 county budget during the commissioners meeting, and they make a determination about what the tax rate needs to be. 

The county is limited to a 3.5% tax hike after the state legislature implemented a cap last year. However, the county may propose a larger hike, possibly as much as 8%.

"Today (Tuesday) we are getting the range in which we can operate," Gothia said. "We hope to stay at the current rate, but we have to know where we are first."

The issue is complicated by the relatively new law on the books in Texas. Senate Bill 2 was passed in 2019 by republicans who believed it would slow the growth of Texans' property tax bills. Despite many local governments voicing concern that the state's one-size-fits all approach would limit revenue, Governor Greg Abbott signed SB2 into law in June 2019. 

The bill made an array of changes to the property appraisal and tax systems, including a provision that requires cities and counties to hold an election if they want to raise property tax revenue by more than 3.5%.

Since the 1980s, taxing entities were restricted to an 8% increase in property tax revenue. Voters had to petition for an election to roll back that rate. 

Gothia tells 12News the county would be able to allowed to implement an increase above the 3.5% cap since it was due to a natural disaster.