Estimated Time to Read: 7 minutes
Tuesday, Texas Lt. Gov. Dan Patrick (R) introduced what he called “Operation Double Nickel” as a groundbreaking shift in Texas property tax policy. Yet beneath the branding, Texans will recognize a familiar script. For years, lawmakers have promised sweeping relief through homestead exemption increases and targeted freezes. Each time, they celebrate these measures as historic victories, and each time, Texans soon discover that appraisal increases, local spending growth, and the state’s own budget expansions erase the temporary savings.
Patrick’s latest rollout follows the same pattern. It proposes to raise exemptions yet again, extend age-based tax protections, and avoid the structural reforms that could actually reduce property taxes in a permanent, predictable way. Texans have heard enough speeches and slogans. They want real reform, something Patrick’s plan does not deliver.
Operation Double Nickel is not a breakthrough. It is a recycled playbook, dressed up for a new press conference, offering temporary relief instead of structural change.
Patrick’s Freeze Expansion: Burden-Shifting, Not Relief
At the heart of Patrick’s plan is a proposal to lower the school tax freeze from age 65 to 55. He describes it as a powerful form of relief for millions of Texans, but the reality is that it simply shifts the burden to younger families, renters, and businesses. Freezes do not reduce spending or shrink tax rates. They only ensure that one population is exempt from increases, forcing others to bear a disproportionate share of the load.
Lowering the freeze age also discourages mobility. When homeowners lock in their tax obligation at 55, they face strong incentives to stay in their homes indefinitely. This artificially restricts housing supply, inflates prices, and makes it more difficult for first-time buyers to find a stable footing in the market. At the same time, the state quietly absorbs a growing financial obligation as it must backfill school districts for an increasingly large share of frozen tax revenue.
There is nothing fiscally conservative about creating permanent liabilities or shifting burdens from one group of Texans to another. This is not structural reform. It is tax redistribution disguised as relief.
The Homestead Exemption Gimmick
Patrick’s proposal to increase the homestead exemption again reveals the foundational flaw in his entire approach. Homestead exemptions have become the default political escape hatch for legislators who refuse to control spending. The pattern never changes. Appraisals rise, local budgets rise, property taxes rise, and lawmakers respond by raising the homestead exemption and declaring victory.
Texans approve these exemptions because they need relief, but inflation and appraisal growth swallow the benefit almost immediately. Lawmakers then return a year or two later, insisting that another exemption increase will finally fix the problem. It is a cycle designed to create the illusion of action while leaving the tax system fundamentally unchanged.
Patrick talks about homestead exemptions, freezes, and appraisal spikes as if they represent the core of the problem. They don’t. They are symptoms of something much deeper: a government that refuses to restrain spending. Local property taxes now exceed $80 billion per year, a staggering increase of roughly 70% since 2015, even though population plus inflation grew only about 50%. Property taxes rise because government spending rises. School districts expand payrolls and programs. Cities approve aggressive development and accumulate new debt. Counties expand services far beyond population requirements. Special districts proliferate with almost no limits or oversight.
This is not policymaking. It is not structural relief. It is not reform. It is political gaslighting dressed up as tax relief, and Texans are right to be exhausted by it. No serious economist believes repeated homestead hikes represent meaningful tax reform. They are optics. They mask the real issue, overspending, while delivering short-lived benefits that vanish almost instantly.
Runaway Spending Drives Property Taxes
Patrick repeatedly frames appraisal increases, exemption levels, or local tax administration as if they create the burden facing Texans. In truth, property taxes soar because spending soars. When cities, counties, school districts, and special districts all grow their budgets faster than the combined rate of population growth and inflation, the result is inevitable. Higher spending demands higher revenue, and Texans foot the bill.
No amount of homestead exemption tinkering will change that. Relief that ignores spending is not relief at all. It is a temporary political cover.
Compression Is the Only Structural, Equitable Solution
Patrick argues that homestead exemptions provide more “bang for the buck” than compression. This framing is misleading because it ignores the purpose of compression. Homestead exemptions do not reduce the size of the school property tax system. They simply reassign who pays into it.
Compression is different. Compression lowers the school maintenance and operations (M&O) tax rate for everyone. It offers broad-based relief to homeowners and renters, reduces burdens on employers and small businesses, strengthens economic competitiveness, and directly shrinks the footprint of the school property tax system. It is the only tool that moves Texas toward eliminating the school district M&O tax altogether.
Texas currently has historic budget surpluses, and those dollars should be used to buy down school tax rates permanently, not to expand homestead gimmicks that provide only short-term optics. If the goal is meaningful, lasting reform, compression is the only mechanism capable of providing it.
A Smarter Framework for Reform
Just weeks ago, Texas Governor Greg Abbott (R) unveiled a five-pillar property tax reform plan that, while imperfect, at least recognizes a core truth Patrick refuses to confront: Texas will not see real property tax relief until government spending is restrained. Abbott’s framework includes statutory spending limits for local governments, voter-approval thresholds for tax increases, appraisal reforms, rollback elections initiated by citizen petition, and a long-term path to eliminating the school district M&O tax. These proposals shift the conversation toward structural solutions rather than short-term political optics.
Abbott’s plan embraces principles that fiscal conservatives and Texas Policy Research (TPR) have long championed. Relief without reform is temporary. Local spending is out of control. Discipline is required at every level of government. Sustainable budgeting is the prerequisite to eliminating school district property taxes. These principles acknowledge that spending drives tax burdens, not appraisal formulas or exemption levels.
Patrick’s approach moves Texas in the opposite direction. His plan expands obligations, expands exemptions that distort the tax base, expands freezes that shift burdens, and expands the reliance on gimmicks rather than reform. Abbott at least pushes the debate toward discipline. Patrick pushes it toward political convenience.
The Only Path Forward: Sustainable Budgeting and True Tax Reform
Texas does not need more exemptions or additional freezes. It does not need another round of symbolic gestures that provide only temporary relief. What Texas needs is a sustainable budget, one that grows more slowly than population plus inflation. It needs mandatory spending restraint for cities, counties, and school districts so that these entities cannot continually expand their budgets while taxpayers struggle to keep up. It needs every surplus dollar committed to compression, accelerating the reduction of school district tax rates year after year. And it needs a long-term path to fully eliminate the school M&O tax, paired with a modernized, broad-based consumption model that reflects the realities of today’s economy.
Contrary to fearmongering, achieving this future does not require dramatic tax increases or complex fiscal engineering. It does not require Washington-style policymaking. It requires courage. Courage to restrain government rather than expand it. Courage to reform systems rather than protect them. Courage to trust Texans with their own money.
Operation Double Nickel offers none of that. Texans deserve a property tax system grounded in ownership, discipline, and structural reform, not one that relies on perpetual gimmicks and short-term fixes. The path forward is clear: spend less, compress more, and deliver the real relief Texans have been promised for far too long.
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