Texas lawmakers tackle rising property tax burden on veterans

In a recent government meeting, local officials expressed concerns regarding the growing impact of property tax exemptions for disabled veterans on municipal finances. The discussion highlighted the complexities surrounding these exemptions, particularly in areas with significant military populations, such as Bell County and Killeen.

Officials noted that since the introduction of the disabled veterans and spouses exemption, the number of recipients has surged dramatically, with Bell County reporting over 15,000 exemptions in fiscal year 2025, a significant increase from just 701 in 2010. This exponential growth has led to a substantial loss of revenue for local governments, with Bell County averaging a 21% reimbursement from the state for lost revenue due to these exemptions.

The meeting underscored the need for a sustainable reimbursement formula to alleviate the financial burden on local governments, which are struggling to maintain services as the tax base shrinks. Killeen's city manager reported that the value of disabled veterans' exemptions has outpaced new construction in the city for six consecutive years, now accounting for 20% of the city's taxable base.

Senators and local officials emphasized their commitment to supporting veterans while also recognizing the unintended consequences of the exemptions. They discussed the importance of ensuring that the benefits provided to veterans do not disproportionately impact the communities that support them. The conversation also touched on the need for further data to understand the demographics of those receiving exemptions and the potential for reform to ensure equitable tax burdens across the community.

As the state prepares for the upcoming legislative session, officials are calling for a collaborative approach to address these challenges, aiming to balance support for veterans with the fiscal realities faced by local governments.