Monday, February 19, 2018

Kilgore ISD to appeal homestead ruling

By Glenn Evans
Dec. 18, 2017 at 11:55 p.m.

KILGORE — An unusual legal battle continues for Kilgore ISD after trustees Monday unanimously agreed to appeal a judge's ruling that would require it to refund millions in property tax collections.

The decision came after board members met 41 minutes in closed session with their attorney. Trustees did not discuss the action publicly before voting, but in making his motion, Trustee John Slagle said the district is supported in the move by the Texas Association of School Boards.

The situation stems from a 2016 lawsuit filed by two homeowners, a case later joined by Texas Attorney General Ken Paxton. The attorney general previously had issued a nonbinding opinion that districts that removed a 20 percent local optional homestead exemption after passage of a 2015 school reform bill did so illegally.

Homeowners Sheila Anderson and Darlene and John Axberg paid their full tax bills in 2015 and 2016, but sued to get back the portion they would not have paid if the homestead exemption had been in place.

The case was filed in Gregg County Court at Law No. 2, where Judge Vincent Dulweber issued a summary judgment Dec. 7 in favor of the homeowners. A summary judgment is routinely requested by both plaintiffs and defendants in civil court as a quick, cut-to-the-end motion when all evidence has been presented to the court.

The district, meanwhile, socked away $2.3 million in its general fund as a contingency against an unfavorable ruling.

The board's 5-2 vote on June 29, 2015, to remove the homestead exemption took place weeks after Senate Bill 1 was approved by lawmakers in Austin. But it was before SB1 took effect Sept. 1, 2015.

Discussion at the June 2015 meeting, where the board was starting its annual budget-writing process, revolved around trustees' belief they had to remove the then-optional homestead exemption or see it locked in for five years.

The exemption had been offered to Kilgore ISD taxpayers for at least two decades. Trustees estimated doing so would generate $660,000 a year.

They also said they would be free to reinstate the long-honored exemption, emphasizing the decision was one of local control.

In the lawsuit, Kilgore ISD argues that forcing the district to retroactively offer the homestead exemption based on a law that had not yet rolled out is unconstitutional.

The appeal will be filed in either the 6th Court of Appeals in Texarkana or the 12th Court of Appeals in Tyler.



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