The Flower Mound Town Council voted Monday night to raise the Homestead tax exemption from 5% to 10%.
The 5% Homestead exemption was saving the average Flower Mound homeowner about $96 per year. Raising it to 10% will double that number.
“The Town will still receive the maximum amount of property tax revenue allowed by the state,” said Councilman Brian Taylor in a statement I am optimistic we can further reduce the overall tax rate to also allow some tax relief to our Town’s small business owners.”
The town’s first Homestead exemption was approved in 2018, set at the greater of $5,000 or 2.5% of the home’s value. Last year, council approved an increase to 5% of value. Town staff had recommended raising the Homestead exemption to 7.5%, but some council members thought that wasn’t enough. Councilman Adam Schiestel said the 2.5% increase last year was “too conservative,” and he pushed for this year’s exemption to be raised to 10%. Rising inflation and surging property values/appraisals were the main themes of the discussion.
“The conservative approach is to keep it at an incremental 2.5%, safe,” Town Manager James Childers told the council. “Are there risks associated with going to 10%? Potentially, but they’re not at the point where I can come out and say, ‘We absolutely shouldn’t do this … but I am worried about the unknowns.”
All council members except Ann Martin voted in favor of the 10% increase. Martin argued for 7.5 or 8%, because 10% might be too high next year and she’d rather not have to reduce the exemption.
The 10% Homestead exemption will become effective beginning with the Fiscal Year 2022-23.