Texas legislative leaders — Dan Patrick, Dade Phelan — jab each other’s priorities in dueling speeches

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The leaders of the two chambers in the Texas Legislature gave a preview of their major sticking points in priorities Thursday, setting an uncertain tone on some of the biggest issues as the session starts to ramp up.

During dueling speeches to a conservative think tank in Austin, state House Speaker Dade Phelan and Lt. Gov. Dan Patrick, who have a history of animus, split most starkly on the best way to deliver lasting property tax relief to Texans. But there was also clear tension on display when it came to their approaches to criminal justice reform and school choice.

Phelan is in his second term as speaker, while Patrick is presiding over the Senate for his fifth regular session — and with his most loyal chamber ever. The two got off to a rocky start in 2021 as the chambers diverged on how to respond to the power grid collapse — and then again as Patrick criticized Phelan’s handling of a priority elections bill that Democrats tried to stop by leaving for Washington, D.C.

Phelan spoke to the Texas Public Policy Foundation hours before debuting his priority property tax bill, which would reduce the limit on annual appraisal increases from 10% to 5% — and expand it to all types of property, including businesses. Phelan trumpeted it as “meaningful, real relief” in his speech, but Patrick panned the idea in his address.

“I must say something, and this is not a criticism whatsoever, so please understand that, but I know the House is pitching appraisal caps,” Patrick said. “Appraisal caps — lowering them now will destroy everything we just accomplished. … I think the intentions of the House are good, but that would be a disaster and undo everything we’ve done.”

Patrick was referring to changes that lawmakers made to the property tax system in 2019, when Patrick said they “decoupled appraisals from your tax bill.” It was not immediately clear how exactly Patrick saw Phelan’s bill undermining that, and Patrick himself pushed to lower the appraisal cap when he was a senator over a decade ago.

Asked for clarity, Patrick’s office provided a statement from the lieutenant governor that further explained his position.

“Over the many years of fighting for property tax cuts, many of us have learned the best path to permanent long-time property tax relief for homeowners was to lower the rollback rate to control the growth of government spending,” Patrick said. “At the same time, dramatically increasing the permanent year-after-year homestead exemption will save the average homeowner nearly $24,000 over a 30 year mortgage. That will have a much greater impact than an appraisal cap. That's for all 5.7 million homesteads every year. That's real tax relief.”

Patrick’s priority property tax proposal indeed focuses on raising the homestead exemption, which is the share of a home’s appraised value that is exempt from property taxes. Patrick wants to take it from $40,000 to $70,000.

Phelan said he was “not in any way shutting the door on increasing the homestead exemption.” But he questioned how that benefits small businesses who are suffering given that it only deals with Texans’ primary residences.

It remains to be seen which approach is favored by Gov. Greg Abbott, whose top priorities this session include property tax relief. During a moderated discussion Friday for the San Antonio Chamber of Commerce, Abbott was asked if he had a preference and largely focused on the areas of agreement between the chambers, like delivering at least $15 billion in property tax cuts. But he did shout out appraisal reform, Phelan's priority, without mentioning increasing the homestead exemption, Patrick's priority.

"One thing that I heard countless times on the campaign trail — and as I talk to people across the state of Texas — their appraisals are too high, and they want to see something done with regard to appraisal reform," Abbott said. "So that's another thing that will be looked at."

Asked afterward by a reporter if he liked one approach over the other, Abbott did not say.

On school choice, the House has historically balked at efforts to redirect state tax revenue to help parents take their kids out of public schools. With that in mind, Phelan has been relatively muted on the push this session, even as Gov. Greg Abbott puts more energy into it than ever before. Addressing TPPF on Wednesday, Abbott said it would be the “most consequential policy victory this session.”

But Phelan did not address it in his speech other than to deliver a line that he says regularly — that he has 149 members and they all have a different definition of “school choice.” Patrick latched on to that in his speech.

“I don’t know what his opinion is, but he’s No. 150, and if he gets on board, the other 149, I think, will follow,” Patrick said.

Patrick also said he did not believe lawmakers should go home until they pass a school choice program. The regular session, which started in January, ends in late May, and the governor gets to decide whether to call a special session.

“I don’t care how many special sessions it takes,” Patrick said. “We have time. I don’t have any plans this summer.”

It is the second priority over which Patrick has plainly threatened to force a special session. He has also said he would do so if lawmakers cannot find a way to increase the state’s natural-gas capacity, a response to the 2021 power grid failure.

When it came to criminal justice reform, Phelan initiated the back and forth Thursday with a jab at Patrick over the Senate’s blocking of multiple House bills on the subject two years ago. Phelan backed a suite of criminal justice reform proposals including measures to narrow the use of the death penalty and reforming sentencing for minors.

“I know what to do this session when it comes to criminal justice, and it’s just pass everything that the Senate did not pass last session,” Phelan said, noting TPPF backed his proposals. “We’re gonna pass it again. I figure if it’s good enough for TPPF, it’s good enough for Donald Trump, it should be good enough for the Texas Senate.”

Patrick rebutted that by pointing to several of his priorities that the same mantra could be applied in the House.

“School choice — I can tell you that the Senate likes it, TPPF likes it, Donald Trump likes it, so it should be good enough for the House,” Patrick said.

Other priorities that Patrick mentioned as being “good enough for the House” included “banning children’s exposure to drag shows,” “protecting children from obscenity in libraries” and “banning critical race theory in college.”

Disclosure: Texas Public Policy Foundation has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.