The tax burden shifts from homeowners to others in McLennan County with new exemptions


New state and local property tax exemptions worked as intended in McLennan County, reducing the total taxes levied on homestead exempt owners by nearly 3% year over year, according to data compiled by the local appraisal district.

But that means higher bills for the 41% of the county’s residents who rent and for commercial property owners. Total taxes levied on McLennan County residences without a homestead tax exemption, primarily rental properties, increased 23% year over year. The commercial real estate tax increased by 7%.

A larger portion of this year’s tax levy collected from all McLennan County businesses will come from rental properties, contributing to rising rental costs.

The majority of county tax agencies lowered their tax rates or maintained last year’s tax rate given statewide taxable real estate values, which increased $3.2 billion, or about 15%, from a year ago.

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“Overall, tax rates for the county are going down over time, which should be the case as rates go up,” said Joe Don Bobbitt, chief appraiser for the McLennan County Appraisal District.

The shift in the tax burden away from homeowners to other landowners has been accompanied by expanded homestead tax credits.

Voters across the state in May approved a measure to expand the homestead school tax exemption, which applies to properties that serve as the owner’s primary residence, from a $25,000 reduction in tax value to a $40,000 reduction.

The Waco City Council responded in June by increasing Waco’s overall homestead tax exemption from 10% to 15%, increasing the city’s tax exemption for homeowners age 65 and older from $5,000 to $50,000, and introducing a new $50,000 tax exemption for homeowners Added homeowners with disabilities.

Woodway, which does not have a general home tax exemption, has expanded its tax exemption for homeowners age 65 and older from $10,000 to $20,000 and added a $20,000 tax exemption for homeowners with disabilities.

“Anything that isn’t (property except homesteads) probably went up,” Bobbitt said.

All McLennan County unit taxes levied on residence without homestead exemptions increased by 9% from 2020 to 2021, and according to Bobbitt, who used weighted averages to prevent new properties or exemption status changes from skewing the data then by 23% from 2021 to 2022; while taxes on homes with an exemption increased 3% from 2020-2021 and then decreased 3% from 2021-2022; and taxes levied on commercial property decreased by 7% from 2020-2021 and then increased by 7% from 2021-2022.

While homeowners are seeing an overall drop in property taxes this year, individual cases vary significantly. And often, staggering increases in value have led to a surge in owners filing formal protests against property values ​​set by the appraisal district. The number of protests this year reached 19,000, compared to 15,000 last year, Bobbitt said.

John Eagle said the tax value of the Brookview home he bought in 2020 has increased more than 10% annually since 2015.

Rod Aydelotte, Tribune Herald

tax burden

John Eagle said the tax value of the Brookview home he bought in 2020 has increased more than 10% annually since 2015.

Rod Aydelotte, Tribune Herald

The vast majority of property value protests have been settled by this point in the year. One of the few homeowners still fighting their reviews is local doctor John Eagle, who said he hired a startup to argue for him this time after being unsuccessful last year.

He bought his home in the Brookview neighborhood in May 2020, taking advantage of then-low interest rates. Eagle said the home was a steal at about $160,000, but his appraisal has since increased by about $50,000.

He and his wife invested in the pale yellow home, remodeling portions of the kitchen and preserving the home’s original hardwood floors before turning to the exterior and landscaping.

Under state law, the taxable value of a property with a homestead exemption cannot increase by more than 10% per year, but the cap does not apply to the value of new improvements made to the property.

“I think the hardest part is that improvements are penalized,” Eagle said. “We have put a lot of work into this house and would like to stay here for a long time. … At the same time, it punishes us in the long run if it increases appreciation.”

He said the home’s appraisal has increased about 10.6% per year since 2015, compared to a 3.6% increase in Waco’s median wage over the same period.

“How can you keep up with the appraised value of your home unless you’re getting constant promotions or raises?” Adler said.

When he first tried to argue for a lower valuation, he took the wrong approach, focusing on his issues with Waco ISD’s and other tax agencies’ use of property taxes. This time he said he hired Ownwell, a Texas startup that will plead his case in exchange for half the money the company is able to save him.


Retired elementary school teacher Pam Cooper plays the organ at her China Spring home, whose taxable value has risen to $143,760 from $116,360 a year ago.

Jerry Larson, Tribune Herald

For retired schoolteacher Pam Cooper, this year’s property appraisal for her home near China Spring made her choke. Valuation rose to $143,760 from $116,360 last year.

“I’m one of those guys who thinks school teachers don’t have to pay school taxes when they retire,” she said.

Cooper, 71, retired in 2020 after 37 years as an elementary school teacher, including 22 years with the Waco Independent School District. It pays property taxes to McLennan County, the City of Waco, McLennan Community College and China Spring ISD and qualifies for homestead and senior citizen exemptions in the tax jurisdictions that they offer.

Cooper estimates that she receives about $3,100 a month in pensions, but any future increases in those benefits would come from the Texas legislature.

The $715 she paid in property taxes last year was up from $650 last year, making her wonder what this year’s tax bill will look like with the higher valuations. Cooper serves part-time as President of the Greater Waco American Federation of Texas, but relies largely on her retirement through the Teacher Retirement System of Texas.

Nearly three years ago, Waco artist Susan Sistrunk and her then-partner Mark Kieran moved into the 112-year-old house, which is also their home and home of their Susan L. Sistrunk Fine Art Gallery.

property taxes

Susan Sistrunk works in the studio at the Washington Avenue property, which she rents as a gallery and home. Her tax situation, without the benefit of a homestead exemption, was further complicated this year by the addition of furnishings to the property taxed as part of her business.

Jerry Larson, Tribune Herald

Its location at the 2100 block of Washington Avenue was a major draw, close to downtown Waco and access to potential clients, local artists and business associates, but more affordable than properties closer to downtown.

She rents the property through property management firm The Cromwell Co. for $1,750 a month. Last year, the property valuation for the 1,940-square-foot home went from $176,410 to $211,570, with taxes set at $4,563.20.

Her lease has increased by $100 a month this year, and she’s worried about what rising real estate values ​​will mean for a gallerist and artist working on a slim profit margin.

“When you’re dealing with a home-based business, you want to keep costs low and debt-free. … I am a debt-free company and intend to remain so,” she said.

County tax records show a Barry J. Williams of Austin as the owner of the home. Attempts to contact him for comment have been unsuccessful.

property taxes

Susan Sistrunk stands in front of the Washington Avenue property she has rented as a gallery and home. Her tax situation, without the benefit of a homestead exemption, was further complicated this year by the addition of furnishings to the property taxed as part of her business.

Jerry Larson, Tribune Herald

In addition to paying property taxes through her lease, Sistrunk pays quarterly sales taxes from her business. She said she was upset to receive a notice from the county tax office this year that some of her home furnishings, such as antique chairs and a couch she inherited from her family, would be considered part of her business and taxed accordingly.

“The amount isn’t huge … but my concern is that taxes will continue to rise,” Sistrunk said. “I take pride in serving local artists in the community. If this drives my prices up, people won’t pay the prices (you see) in Dallas and Austin. When will this nickel and diming stop?”

According to data from, the average rent for a two-bedroom apartment in McLennan County increased from $915 to $1,181 from 2020 to 2022.

Robert Denton, a local landlord who owns both commercial and residential properties, said there are factors alongside rising property taxes that will increase rental prices in the future.

He said the number of properties the assessment district oversees has nearly quadrupled in recent years, but staff numbers have remained more or less the same, and he doesn’t blame the assessment district.

He said inflation, maintenance costs and rising interest rates are factors affecting rent along with property taxes. Insurance costs also increase depending on the property value.

“We’re poised to go into more of a recession, and the numbers … of people being evicted, people not being able to pay their rent, all those numbers are going to increase,” Denton said.

He also said real estate investment trusts, which are buying up as many rental properties as possible, are more active in McLennan County than in previous years.

“These are investors you don’t know and you don’t see,” Denton said. “If you’re trying to say, ‘Whose is this?’ it will say “Such and Such LLC. Well, it’s not owned by an LLC, it’s a public company.”

Denton said he expects a familiar pattern to unfold over the next few years. Tenants are being pushed further and further out of the core cities by rising rents.

“There will be no change because property values ​​will not go down,” he said. “Until the recession penetrates the bubble we live in, I don’t think we will see any reduction.”


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