The Committee on Local Government on Monday adopted a committee substitute to House Bill 9 and reported House Joint Resolution 1 to the full Senate, advancing a proposal to raise the business personal property exemption from $2,500 to $125,000 and to seek voter approval of a constitutional amendment to allow the change.

Supporters told the committee the increase would provide targeted relief for small businesses and reduce the cumulative tax burden on items taxed repeatedly. "The hundred $25,000 level is a fair level. It is a meaningful level," said Glenn Hammer, president and CEO of the Texas Association of Business.

Why it matters: The committee substitute would exempt substantially more business personal property from local property tax, delivering a one-time per-business savings that proponents say averages roughly $2,500 for qualifying firms. Committee members and witnesses said the change would be phased in to take effect in the year after voter approval, giving local governments time to plan.

What happened in committee: Chairman Paul Bettencourt moved to adopt the committee substitute. The motion passed on a voice/roll call with six ayes recorded (Bettencourt, Middleton, Cook, Gutierrez, Nichols, West). The committee then reported the committee substitute to the full Senate with the committee’s recommendation (report language and clerk roll call recorded on the record).

Key testimony and estimates: Business groups including Texas Realtors, the Texas Retailers Association, NFIB, Texas Taxpayers and Research Association, and the Texas Association of Business testified in favor. Christy/Christie (record shows "Christie Yesler") from Texas Realtors said the proposal would benefit small-business owners. John McCord of the Texas Retailers Association and Jeff Burdett, state director of NFIB, also testified in support.

Municipal concerns: Brady Kirk, assistant director for budget and property tax for the City of Fort Worth, said a $125,000 exemption would reduce Fort Worth’s tax base by an estimated $7–8 million and a $250,000 exemption would be about $11 million, shifting more of the tax burden to homeowners over time if elected officials chose to recoup revenue through the tax rate. Kirk said the bill’s effective date (the year after voter approval) would give local governments time to adjust.

Procedure and next steps: The committee left both the committee substitute to HB 9 and the committee substitute to HJR 1 pending and reported them to the full Senate. If HJR 1 is passed by the Legislature, the constitutional amendment would be placed on the Nov. 4, 2025 ballot.

Ending: Both measures now move to the full Senate for further consideration.