Lee Leffingwell says Austin has lowest property tax rate of Texas’ 5 biggest cities

Two days before city staffers discussed raising Austin’s property tax levy, Mayor Lee Leffingwell touted the city’s rate in a televised debate.

Facing off against mayoral opponents Brigid Shea and Clay Dafoe in an April 16, 2012, forum on KXAN-TV, Channel 36, Leffingwell said, "The City of Austin has the lowest property tax rate by far of the five major cities in Texas, including Fort Worth, Houston, Dallas and San Antonio."

Does that add up?

By email, Leffingwell campaign consultant Mark Littlefield and city spokesman Reyne Telles told us that Leffingwell used data from a chart prepared by city staff for its annual five-year financial forecast. Littlefield sent us that chart plus a second one showing estimated tax bills in each city.

Ed Van Eenoo, Austin’s city budget officer, told us by email that his office created the charts with 2011 tax rates, home values and sales price information from county appraisal districts and the Real Estate Center at Texas A&M University.

We checked the numbers with the districts and center, and found Austin’s property tax rate was the lowest, considerably, of Texas’ five biggest cities, as Leffingwell said. The full list: Fort Worth, 85.5 cents per $100 of appraised value; Dallas, 79.7 cents; Houston, 63.875 cents; San Antonio, 56.5569 cents, Austin, 48.11 cents.

But tax rates are only part of the equation when it comes to figuring out how hard a homeowner’s pocketbook gets hit.

Here, in fact, is the equation, from Austin’s budget office: Take your house’s dollar value; subtract any homestead or other exemptions; divide by 100; then multiply by the tax rate -- with the tax rate expressed in dollars; for example, 0.4811 rather than "48.11 cents."

We calculated how much typical homeowners had to pay in 2011 using two different measures: average appraised values from each county tax appraisal districts, and median sales price from the center, which gets data from real estate professionals across the state.

Although exemptions affect many tax bills, we excluded them here because they vary with each homeowner and each city, county and taxing jurisdiction.

In 2011, Austin had both the highest median sale price and the highest average appraised value among the five cities. But because of the city’s low tax rate, Austin’s tax bill (excluding exemptions) on an average-value home was second-highest, and its tax bill on a median sales-price home came in fourth.

Calculated using 2011 median sales price and 2011 city tax rate, Dallas had the highest bill -- $1,262 on a $158,400 house -- followed by Houston’s $982 on a $153,700 house, Fort Worth’s $946 bill on a $110,600 house, Austin’s $918 on a $190,900 house and San Antonio’s $856 on a $151,300 house.

Using the same tax rates and 2011’s average appraised values, Dallas was first again, with a $1,441 bill on a $180,847 house, followed by Austin’s $1,224 bill on a $254,328 house, Houston’s $1,057 on a $165,535 house, Fort Worth’s $968 on a $113,247 house and San Antonio’s $725 on a $128,151 house.

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Because averages can be skewed by a few very high or low values, taking the median value offers a way to dampen the effect of those extremes. Medians represent a "middle" value -- median sales price would be the dollar amount at which half a city's homes sold for more and half sold for less.

The city's tax bill chart used median sales prices, except for Austin, where the median appraised home value was available, and factored in homestead exemptions. Reckoned that way, Austin’s tax bill again came out second-highest.

Of course, cities are only one of the entities taking a chomp out of your property taxes. Depending on where your house is, county government, school districts, community colleges and possibly many others get a bite.

The Austin owner of a $190,900 home in 2011, for example, paid $2,371 to the Austin school district; $927 to Travis County; $181 to Austin Community College; and $151 to Central Health (Travis County’s healthcare district) on top of the $918 city tax bill.

Also, Austinites recently learned that 2013 might bring an increase in the city’s rate. The Austin American-Statesman reported April 18 that the owner of a median-value home would pay $33 more under a tax rate of 49.95 cents per $100 of property -- the rate city staffers said Austin would need to cover its costs next year.

Leffingwell responded to the news with a statement that he would look for ways to cut spending rather than raise the property tax rate.

That 49.95-cent rate for 2012 is still lower than the other cities’ 2011 rates, but it’s too early to know what all the 2012 rates -- and home values -- will be.

Our ruling

Leffingwell’s right on the rates. Austin had the lowest 2011 city property tax rate among Texas’ five biggest cities.

Yet rates alone are not the only, or even best, indicator of how much residents have been socked by property taxes. Comparing each city’s average-value home in 2011, for instance, Austin would have extracted the second-highest tax payment.

Without this context, Leffingwell’s rate comparison misrepresents this pocketbook issue. His claim rates Half True.