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House yield bill H.491 would cut projected K‑12 property tax increase to 1.1% using one‑time transfers
Summary
Lawmakers walked through H.491, the statewide education property tax ‘yield’ bill, which sets per‑pupil yields and uses a proposed $77 million one‑time general‑fund transfer plus $41 million in prior‑year unreserved Education Fund balance to reduce an initially projected 5.9% average increase to about 1.1%.
Representative Kimball, a member of the House Ways and Means Committee, told the Senate Finance Committee that H.491 sets the statewide education property tax yields for fiscal 2026 and would lower the projected average property tax increase from 5.9% to 1.1% by using one‑time resources.
The bill sets the property dollar‑equivalent yield at $8,596 per pupil and the income dollar‑equivalent yield at $12,172, and establishes a uniform non‑homestead property‑tax rate of $1.07 (reported in committee as $1.07 and $0.03 for 100 equalized value in the transcript). Representative Kimball said the plan assumes a $77 million one‑time general‑fund transfer plus approximately $41 million in prior‑year unreserved Education Fund balances to buy down rates.
Why it matters: The yields and rates in H.491 determine how much local property taxpayers are asked to raise for K‑12 education next fiscal year. Committee members and fiscal staff emphasized the difference between using the full $77 million transfer and not using it: without the $77 million transfer (but using the $41 million surplus), committee modeling showed an average increase near 5.8%, and a different yield and non‑homestead rate (documented in committee materials as a yield of about $8,224, income yield $11,584 and a non‑homestead rate of about $1.72).
Committee discussion and technical fixes: John Gray of the legislative office walked members through the bill text, describing H.491 as “two pages” and identifying a technical correction in section 2 related to the statewide adjustment used with the Common Level of Appraisal (CLA). Gray said the provision is a technical fix to make the statewide adjustment apply where intended and avoid inadvertently expanding a calculation because a reference was missed in last year’s changes.
Fiscal outlook and contingencies: Fiscal staff presented an Education Fund outlook showing the house construct’s FY‑26 columns, the December 1 projection, and the house‑passed H.491 scenario. The outlook shown to the committee reflected the $77 million assumed transfer and the $41 million unreserved surplus being used, leaving the fund with little unreserved balance under the house construct. Staff noted the construct also assumes the stabilization reserve is maintained at 5%.
Staff and members repeatedly flagged uncertainty about whether the $77 million general‑fund transfer will remain available through the budget process; Representative Kimball and others said the $77 million is appropriated in the appropriations bill, not in the yield bill itself, and cautioned the transfer is not guaranteed until the budget process is finalized.
Federal and other risks: Committee members asked whether the outlook reflects possible federal funding reductions (for example, ESSER or other federal education funds). Fiscal staff said the Education Fund outlook presented reflects state dollars only and does not adjust for possible federal reductions; if federal funds are reduced, the policy question would be how much, if any, the state should backfill.
Next steps: Committee members scheduled further work and a fuller walk‑through; Representative Kimball and staff said the committee planned an initial floor and committee exchange and a subsequent detailed review next week.
