Kilgore ISD reaches agreement in class-action lawsuit over homestead exemption repeal

Kilgore ISD reaches agreement in class-action lawsuit over homestead exemption repeal
Published: Mar. 15, 2023 at 4:50 PM CDT|Updated: Mar. 15, 2023 at 6:27 PM CDT
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KILGORE, Texas (KLTV) - Residents living within the boundaries of Kilgore ISD now have the chance to claim their portion of a refund granted by a years-long class-action lawsuit.

A Gregg County judge has recently approved a settlement in a class-action lawsuit brought nearly a decade ago by area tax payers against Kilgore ISD. Originally filed by 13 plaintiffs on September 29, 2016, the lawsuit asserted that Kilgore ISD overstepped its authority when removing a local optional homestead exemption in 2015. The suit also asserted that Kilgore ISD “illegally assessed and collected taxes that are subject to this exemption.” The plaintiffs sought to reinstate the exemption, as well as receive a refund of “illegally collected taxes” which were paid to the school district “as a result of duress.”

According to Kilgore ISD attorney Dennis Eichelbaum, district residents were given the option of a local homestead exemption of about $10-15,000, that would cut back taxes collected by the district. In 2015, the Texas legislature passed Senate Bill 1 which gave property owners a similar option. But if a school district had already granted an exemption, as was the case with Kilgore ISD, they had to honor it.

“The legislature added some language that said that if you gave a local optional homestead exemption the previous year, you would have to continue giving that amount of local optional homestead exemption the following year,” said Eichelbaum.

He said that essentially doubled the exemption amount from 2015 to 2019.

“We can’t afford to make it a $35,000 (exemption) because that’s going to take too many taxes away from us for being able to serve the students,” said Eichelbaum.

He said the Kilgore ISD board, like other districts in the state, voted to withdraw the local homestead exemption, but he said there was a delay in making the state homestead exemption law.

“It was signed into law by Governor Abbott on June 15, but it didn’t become law until the state had an election in November approving it,” said Eichelbaum.

Eichelbaum said Kilgore ISD withdrew the local homestead exemption option during the lag time. A group of attorneys and the Texas Attorney General filed suit against school districts who removed the local homestead exemption.

“The attorney general was not joining the lawsuit in order to get taxes back. His purpose was to say, ‘You’re not following the law, and I’m intervening to enforce the law,’” said Eichelbaum.

He said the higher taxes paid to the district amounted to $20-1,500 dollars a year, depending on property value. The case went to the Court of Appeals and the Texas Supreme Court. Before it went farther KISD decided to settle.

“This suit has been pending for six years. It is now resolved, and people have until May 1 to sign up and participate,” said Eichelbaum.

The settlement, which includes the awarding of attorneys fees, promises to refund up to $2,970,967.56 to Gregg County and Rusk County taxpayers residing within the boundaries of Kilgore Independent School District who claimed a homestead exemption and make a timely, valid claim for a refund. Class Counsel is seeking an attorneys’ fee award of one-third of the settlement amount, $990,223.49.

For more information, or to submit a claim, visit the following website: If you have questions pertaining to the suit, call call 304-362-9663.