Mesquite city leaders heard a detailed presentation on a possible resident homestead exemption during a June pre‑meeting budget session, but the City Council did not adopt a change and instead directed staff to return with more analysis in a later budget cycle.

Ted Shen, the city’s finance director, told councilmembers that “this exemption is authorized under Texas tax code and a city may adopt a local option resident homestead exemption of up to 20% of a property's appraised value.” He reviewed how the exemption would reduce the taxable value for owner‑occupied residences and shift some of the tax burden to commercial and rental property owners, and explained statutory timing: an adopted ordinance would have to be filed with the appraisal district before July 1 to take effect for the coming tax year.

Why it matters: adopting a homestead exemption would lower many homeowners’ taxable values but, under Texas’ truth‑in‑taxation rules and the local voter‑approval tax rate construct, could raise the city’s voter‑approval ceiling. As Shen put it in an example, “if you did not want to have an impact on our revenues…you would need to adopt a tax rate up to 72¢ in order to provide that 10% homestead exemption with minimal impact on the budget.”

Councilmembers raised political and practical concerns. Councilmember Kenny Green said residents “are looking at 69¢ and they’re seeing that that’s the highest... It’s really hard to explain to them the backside benefit of the homestead.” Other council members worried about the effect on the city’s competitiveness for commercial development if the city’s effective tax rate rose. The City Manager advised that pursuing a large change now could complicate other budget items and recommended phasing or delaying major action: “it would be my suggestion that this is something we look at next year,” staff said.

What happened next: rather than introduce an ordinance or set a final percentage at the meeting, council directed staff to collect more data and return with additional analysis at later budget workshops this summer. No ordinance was introduced or voted on during the meeting.

The council asked staff to provide comparative data (including how surrounding cities treat homestead exemptions), analysis of the likely revenue impacts at different exemption levels, and any commercial market sensitivity analysis to show how higher tax ceilings might affect development prospects.