Bill Text: TX HB157 | 2021 | 87th Legislature 2nd Special Session | Introduced
Bill Title: Relating to the ad valorem taxation of residential real property.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2021-08-11 - Filed [HB157 Detail]
Download: Texas-2021-HB157-Introduced.html
| 87S20012 SMH-D | ||
| By: Allison | H.B. No. 157 | |
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| relating to the ad valorem taxation of residential real property. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Section 1.12(d), Tax Code, is amended to read as | ||
| follows: | ||
| (d) For purposes of this section, the appraisal ratio of | ||
| real property [ |
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| ratio of the property's market value as determined by the appraisal | ||
| district or appraisal review board, as applicable, to the market | ||
| value of the property according to law. The appraisal ratio is not | ||
| calculated according to the appraised value of the property as | ||
| limited by Section 23.23. | ||
| SECTION 2. Section 11.13, Tax Code, is amended by amending | ||
| Subsection (i) and adding Subsection (s) to read as follows: | ||
| (i) The assessor and collector for a taxing unit may | ||
| disregard the exemptions authorized by Subsection (b), (c), (d), | ||
| [ |
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| pledged for payment of debt without deducting the amount of the | ||
| exemption if: | ||
| (1) prior to adoption of the exemption, the taxing | ||
| unit pledged the taxes for the payment of a debt; and | ||
| (2) granting the exemption would impair the obligation | ||
| of the contract creating the debt. | ||
| (s) In addition to any other exemptions provided by this | ||
| section, an individual who purchases property and qualifies the | ||
| property as the individual's residence homestead is entitled to an | ||
| exemption from taxation of the total appraised value of the | ||
| property for the first tax year the individual qualifies the | ||
| property as the individual's residence homestead if the property: | ||
| (1) is the first property the individual has ever | ||
| qualified as the individual's residence homestead; and | ||
| (2) has an appraised value of less than $300,000 for | ||
| that first tax year. | ||
| SECTION 3. Subchapter B, Chapter 11, Tax Code, is amended by | ||
| adding Section 11.262 to read as follows: | ||
| Sec. 11.262. LIMITATION OF TAXES ON HOMESTEADS FOLLOWING | ||
| CERTAIN PERIOD. (a) In this section, "residence homestead" has the | ||
| meaning assigned by Section 11.13. | ||
| (b) The chief appraiser shall appraise, and the tax assessor | ||
| for each taxing unit shall calculate the taxes on, each residence | ||
| homestead in the manner provided by law for other property. | ||
| (c) Except as provided by Subsection (h), if an individual | ||
| qualifies property as the individual's residence homestead for at | ||
| least 25 consecutive tax years, a taxing unit may not impose taxes | ||
| on that residence homestead in a subsequent tax year in an amount | ||
| that exceeds the lesser of the following amounts: | ||
| (1) the amount of taxes calculated for the taxing unit | ||
| for the current tax year under Subsection (b); or | ||
| (2) the amount of taxes imposed by the taxing unit for | ||
| that 25th tax year. | ||
| (d) For purposes of this section, if the first tax year an | ||
| individual qualified property as the individual's residence | ||
| homestead was a tax year before the 1999 tax year, the individual is | ||
| considered to have qualified the property as the individual's | ||
| residence homestead for the first time in the 1999 tax year. | ||
| (e) If an individual who qualifies for a limitation under | ||
| this section dies, the surviving spouse of the individual is | ||
| entitled to continue receiving the limitation applicable to the | ||
| residence homestead of the individual if the property: | ||
| (1) is the residence homestead of the surviving spouse | ||
| on the date that the individual dies; and | ||
| (2) remains the residence homestead of the surviving | ||
| spouse. | ||
| (f) Except as provided by Subsection (e) or (g), a | ||
| limitation under this section expires on January 1 if the property | ||
| is not the residence homestead of the individual entitled to the | ||
| limitation for the preceding tax year. | ||
| (g) A limitation under this section does not expire if: | ||
| (1) an owner of an interest in the residence homestead | ||
| conveys the interest to a qualifying trust as defined by Section | ||
| 11.13(j) and the owner or the owner's spouse is: | ||
| (A) a trustor of the trust; and | ||
| (B) entitled to occupy the property; or | ||
| (2) the owner of the structure qualifies for an | ||
| exemption under Section 11.13 under the circumstances described by | ||
| Section 11.135(a). | ||
| (h) Except as provided by Subsection (i), a taxing unit may | ||
| increase the tax on a residence homestead subject to a limitation | ||
| under this section in the first year the appraised value of the | ||
| property is increased as the result of an improvement made to the | ||
| property in the preceding tax year. The amount of the tax increase | ||
| is determined by applying the current tax rate of the taxing unit to | ||
| the difference in the taxable value of the property with the | ||
| improvement and the taxable value the property would have had | ||
| without the improvement. A limitation imposed by this section then | ||
| applies to the increased amount of tax until another improvement is | ||
| made to the property. | ||
| (i) An improvement to a residence homestead is not treated | ||
| as an improvement under Subsection (h) if the improvement is: | ||
| (1) a repair; | ||
| (2) required to be made to comply with a governmental | ||
| requirement; or | ||
| (3) subject to Subsection (j), a replacement structure | ||
| for a structure that was rendered uninhabitable or unusable by a | ||
| casualty or by wind or water damage. | ||
| (j) A replacement structure described by Subsection (i)(3) | ||
| is considered to be an improvement under Subsection (h) only if: | ||
| (1) the square footage of the replacement structure | ||
| exceeds the square footage of the replaced structure as the | ||
| replaced structure existed before the casualty or damage occurred; | ||
| or | ||
| (2) the exterior of the replacement structure is of | ||
| higher quality construction and composition than that of the | ||
| replaced structure. | ||
| (k) If the appraisal roll provides for taxation of appraised | ||
| value for a prior year because a limitation under this section was | ||
| erroneously allowed, the tax assessor for the taxing unit shall add | ||
| as back taxes due, as provided by Section 26.09(d), the positive | ||
| difference, if any, between the tax that should have been imposed | ||
| for that tax year and the tax that was imposed because of the | ||
| provisions of this section. | ||
| (l) For each school district in an appraisal district, the | ||
| chief appraiser shall determine the portion of the appraised value | ||
| of residence homesteads of individuals on which school district | ||
| taxes are not imposed in a tax year because of the limitation under | ||
| this section. That portion is calculated by determining the | ||
| taxable value that, if multiplied by the tax rate adopted by the | ||
| school district for the tax year, would produce an amount equal to | ||
| the amount of tax that would have been imposed by the school | ||
| district on those properties if the limitation under this section | ||
| were not in effect, but that was not imposed because of that | ||
| limitation. The chief appraiser shall determine that taxable value | ||
| and certify it to the comptroller as soon as practicable for each | ||
| tax year. | ||
| SECTION 4. Sections 23.19(b) and (g), Tax Code, are amended | ||
| to read as follows: | ||
| (b) If an appraisal district receives a written request for | ||
| the appraisal of real property and improvements of a cooperative | ||
| housing corporation according to the separate interests of the | ||
| corporation's stockholders, the chief appraiser shall separately | ||
| appraise the interests described by Subsection (d) if the | ||
| conditions required by Subsections (e) and (f) have been met. | ||
| Separate appraisal under this section is for the purposes of | ||
| administration of tax exemptions, determination of applicable | ||
| limitations of taxes under Section 11.26, [ |
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| and apportionment by a cooperative housing corporation of property | ||
| taxes among its stockholders but is not the basis for determining | ||
| value on which a tax is imposed under this title. A stockholder | ||
| whose interest is separately appraised under this section may | ||
| protest and appeal the appraised value in the manner provided by | ||
| this title for protest and appeal of the appraised value of other | ||
| property. | ||
| (g) A tax bill or a separate statement accompanying the tax | ||
| bill to a cooperative housing corporation for which interests of | ||
| stockholders are separately appraised under this section must | ||
| state, in addition to the information required by Section 31.01, | ||
| the appraised value and taxable value of each interest separately | ||
| appraised. Each exemption claimed as provided by this title by a | ||
| person entitled to the exemption shall also be deducted from the | ||
| total appraised value of the property of the corporation. The total | ||
| tax imposed by a school district, county, municipality, or junior | ||
| college district shall be reduced by any amount that represents an | ||
| increase in taxes attributable to separately appraised interests of | ||
| the real property and improvements that are subject to the | ||
| limitation of taxes prescribed by Section 11.26, [ |
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| 11.262. The corporation shall apportion among its stockholders | ||
| liability for reimbursing the corporation for property taxes | ||
| according to the relative taxable values of their interests. | ||
| SECTION 5. The heading to Section 23.23, Tax Code, is | ||
| amended to read as follows: | ||
| Sec. 23.23. LIMITATION ON APPRAISED VALUE OF RESIDENTIAL | ||
| REAL PROPERTY [ |
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| SECTION 6. Section 23.23, Tax Code, is amended by amending | ||
| Subsections (a), (b), (c), (e), and (f) and adding Subsections | ||
| (c-1), (c-2), and (c-3) to read as follows: | ||
| (a) Notwithstanding the requirements of Section 25.18 and | ||
| regardless of whether the appraisal office has appraised the | ||
| property and determined the market value of the property for the tax | ||
| year, an appraisal office may increase the appraised value of | ||
| residential real property [ |
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| an amount not to exceed the lesser of: | ||
| (1) the market value of the property for the most | ||
| recent tax year that the market value was determined by the | ||
| appraisal office; or | ||
| (2) the sum of: | ||
| (A) five [ |
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| the property for the preceding tax year; | ||
| (B) the appraised value of the property for the | ||
| preceding tax year; and | ||
| (C) the market value of all new improvements to | ||
| the property. | ||
| (b) When appraising residential real property [ |
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| (1) appraise the property at its market value; and | ||
| (2) include in the appraisal records both the market | ||
| value of the property and the amount computed under Subsection | ||
| (a)(2). | ||
| (c) The limitation provided by Subsection (a) takes effect | ||
| on January 1 of the tax year following the first tax year in which | ||
| the owner owns the property on January 1 or, if the property | ||
| qualifies as the [ |
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| Section 11.13 in the tax year in which the owner acquires the | ||
| property, the limitation takes effect on January 1 of the tax year | ||
| following that [ |
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| by Subsection (c-1) or (c-2), the [ |
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| January 1 of the first tax year following the year in which [ |
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| (c-1) If property subject to a limitation under this section | ||
| qualifies for an exemption under Section 11.13 when the ownership | ||
| of the property is transferred to the owner's spouse or surviving | ||
| spouse, the limitation expires on January 1 of the first tax year | ||
| following the year in which [ |
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| the owner's spouse or surviving spouse ceases to own the property, | ||
| unless the limitation is further continued under this subsection on | ||
| the subsequent transfer to a spouse or surviving spouse [ |
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| (c-2) If property subject to a limitation under Subsection | ||
| (a), other than a residence homestead, is owned by two or more | ||
| persons, the limitation expires on January 1 of the first tax year | ||
| following the year in which the ownership of at least a 50 percent | ||
| interest in the property is sold or otherwise transferred. | ||
| (c-3) For purposes of applying the limitation provided by | ||
| this section in the first tax year after the 2022 tax year in which | ||
| the property is appraised for taxation: | ||
| (1) the property is considered to have been appraised | ||
| for taxation in the 2022 tax year at a market value equal to the | ||
| appraised value of the property for that tax year; | ||
| (2) a person who acquired residential real property in | ||
| a tax year before the 2022 tax year is considered to have acquired | ||
| the property on January 1, 2022; and | ||
| (3) a person who qualified the property for an | ||
| exemption under Section 11.13 as the person's residence homestead | ||
| for any portion of the 2022 tax year is considered to have acquired | ||
| the property in the 2022 tax year. | ||
| (e) In this section: | ||
| (1) "New [ |
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| real property [ |
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| appraisal of the property that increases the market value of the | ||
| property and the value of which is not included in the appraised | ||
| value of the property for the preceding tax year. The term does not | ||
| include repairs to or ordinary maintenance of an existing structure | ||
| or the grounds or another feature of the property. | ||
| (2) "Residential real property": | ||
| (A) means real property that: | ||
| (i) qualifies for an exemption under | ||
| Section 11.13; or | ||
| (ii) is designed or adapted for residential | ||
| purposes, including the residential portion, not to exceed 20 | ||
| acres, of farm or ranch property; and | ||
| (B) does not include real property on which a | ||
| hotel, motel, or similar structure is located that is designed to | ||
| provide temporary lodging or accommodations. | ||
| (f) Notwithstanding Subsections (a) and (e)(1) [ |
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| except as provided by Subdivision (2) of this subsection, an | ||
| improvement to property that would otherwise constitute a new | ||
| improvement is not treated as a new improvement if the improvement | ||
| is a replacement structure for a structure that was rendered | ||
| uninhabitable or unusable by a casualty or by wind or water damage. | ||
| For purposes of appraising the property under Subsection (a) in the | ||
| tax year in which the structure would have constituted a new | ||
| improvement: | ||
| (1) the appraised value the property would have had in | ||
| the preceding tax year if the casualty or damage had not occurred is | ||
| considered to be the appraised value of the property for that year, | ||
| regardless of whether that appraised value exceeds the actual | ||
| appraised value of the property for that year as limited by | ||
| Subsection (a); and | ||
| (2) the replacement structure is considered to be a | ||
| new improvement only if: | ||
| (A) the square footage of the replacement | ||
| structure exceeds that of the replaced structure as that structure | ||
| existed before the casualty or damage occurred; or | ||
| (B) the exterior of the replacement structure is | ||
| of higher quality construction and composition than that of the | ||
| replaced structure. | ||
| SECTION 7. Sections 26.012(6), (13), and (14), Tax Code, | ||
| are amended to read as follows: | ||
| (6) "Current total value" means the total taxable | ||
| value of property listed on the appraisal roll for the current year, | ||
| including all appraisal roll supplements and corrections as of the | ||
| date of the calculation, less the taxable value of property | ||
| exempted for the current tax year for the first time under Section | ||
| 11.31 or 11.315, except that: | ||
| (A) the current total value for a school district | ||
| excludes: | ||
| (i) the total value of homesteads that | ||
| qualify for a tax limitation as provided by Section 11.26; and | ||
| (ii) new property value of property that is | ||
| subject to an agreement entered into under Chapter 313; [ |
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| (B) the current total value for a county, | ||
| municipality, or junior college district excludes the total value | ||
| of homesteads that qualify for a tax limitation provided by Section | ||
| 11.261; and | ||
| (C) the current total value for a taxing unit | ||
| excludes the total value of homesteads that qualify for a tax | ||
| limitation as provided by Section 11.262. | ||
| (13) "Last year's levy" means the total of: | ||
| (A) the amount of taxes that would be generated | ||
| by multiplying the total tax rate adopted by the governing body in | ||
| the preceding year by the total taxable value of property on the | ||
| appraisal roll for the preceding year, including: | ||
| (i) taxable value that was reduced in an | ||
| appeal under Chapter 42; | ||
| (ii) all appraisal roll supplements and | ||
| corrections other than corrections made pursuant to Section | ||
| 25.25(d), as of the date of the calculation, except that last year's | ||
| taxable value for a school district excludes the total value of | ||
| homesteads that qualified for a tax limitation as provided by | ||
| Section 11.26, [ |
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| municipality, or junior college district excludes the total value | ||
| of homesteads that qualified for a tax limitation as provided by | ||
| Section 11.261, and last year's taxable value for a taxing unit | ||
| excludes the total value of homesteads that qualified for a tax | ||
| limitation as provided by Section 11.262; and | ||
| (iii) the portion of taxable value of | ||
| property that is the subject of an appeal under Chapter 42 on July | ||
| 25 that is not in dispute; and | ||
| (B) the amount of taxes refunded by the taxing | ||
| unit in the preceding year for tax years before that year. | ||
| (14) "Last year's total value" means the total taxable | ||
| value of property listed on the appraisal roll for the preceding | ||
| year, including all appraisal roll supplements and corrections, | ||
| other than corrections made pursuant to Section 25.25(d), as of the | ||
| date of the calculation, except that: | ||
| (A) last year's taxable value for a school | ||
| district excludes the total value of homesteads that qualified for | ||
| a tax limitation as provided by Section 11.26; [ |
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| (B) last year's taxable value for a county, | ||
| municipality, or junior college district excludes the total value | ||
| of homesteads that qualified for a tax limitation as provided by | ||
| Section 11.261; and | ||
| (C) last year's taxable value for a taxing unit | ||
| excludes the total value of homesteads that qualified for a tax | ||
| limitation as provided by Section 11.262. | ||
| SECTION 8. Section 42.26(d), Tax Code, is amended to read as | ||
| follows: | ||
| (d) For purposes of this section, the value of the property | ||
| subject to the suit and the value of a comparable property or sample | ||
| property that is used for comparison must be the market value | ||
| determined by the appraisal district when the property is [ |
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| imposed by Section 23.23. | ||
| SECTION 9. Section 44.004(c), Education Code, as amended by | ||
| H.B. No. 2723, Acts of the 87th Legislature, Regular Session, 2021, | ||
| is amended to read as follows: | ||
| (c) The notice of public meeting to discuss and adopt the | ||
| budget and the proposed tax rate may not be smaller than one-quarter | ||
| page of a standard-size or a tabloid-size newspaper, and the | ||
| headline on the notice must be in 18-point or larger type. Subject | ||
| to Subsection (d), the notice must: | ||
| (1) contain a statement in the following form: | ||
| "NOTICE OF PUBLIC MEETING TO DISCUSS BUDGET AND PROPOSED TAX RATE | ||
| "The (name of school district) will hold a public meeting at | ||
| (time, date, year) in (name of room, building, physical location, | ||
| city, state). The purpose of this meeting is to discuss the school | ||
| district's budget that will determine the tax rate that will be | ||
| adopted. Public participation in the discussion is invited." The | ||
| statement of the purpose of the meeting must be in bold type. In | ||
| reduced type, the notice must state: "The tax rate that is | ||
| ultimately adopted at this meeting or at a separate meeting at a | ||
| later date may not exceed the proposed rate shown below unless the | ||
| district publishes a revised notice containing the same information | ||
| and comparisons set out below and holds another public meeting to | ||
| discuss the revised notice." In addition, in reduced type, the | ||
| notice must state: "Visit Texas.gov/PropertyTaxes to find a link to | ||
| your local property tax database on which you can easily access | ||
| information regarding your property taxes, including information | ||
| about proposed tax rates and scheduled public hearings of each | ||
| entity that taxes your property."; | ||
| (2) contain a section entitled "Comparison of Proposed | ||
| Budget with Last Year's Budget," which must show the difference, | ||
| expressed as a percent increase or decrease, as applicable, in the | ||
| amounts budgeted for the preceding fiscal year and the amount | ||
| budgeted for the fiscal year that begins in the current tax year for | ||
| each of the following: | ||
| (A) maintenance and operations; | ||
| (B) debt service; and | ||
| (C) total expenditures; | ||
| (3) contain a section entitled "Total Appraised Value | ||
| and Total Taxable Value," which must show the total appraised value | ||
| and the total taxable value of all property and the total appraised | ||
| value and the total taxable value of new property taxable by the | ||
| district in the preceding tax year and the current tax year as | ||
| calculated under Section 26.04, Tax Code; | ||
| (4) contain a statement of the total amount of the | ||
| outstanding and unpaid bonded indebtedness of the school district; | ||
| (5) contain a section entitled "Comparison of Proposed | ||
| Rates with Last Year's Rates," which must: | ||
| (A) show in rows the tax rates described by | ||
| Subparagraphs (i)-(iii), expressed as amounts per $100 valuation of | ||
| property, for columns entitled "Maintenance & Operations," | ||
| "Interest & Sinking Fund," and "Total," which is the sum of | ||
| "Maintenance & Operations" and "Interest & Sinking Fund": | ||
| (i) the school district's "Last Year's | ||
| Rate"; | ||
| (ii) the "Rate to Maintain Same Level of | ||
| Maintenance & Operations Revenue & Pay Debt Service," which: | ||
| (a) in the case of "Maintenance & | ||
| Operations," is the tax rate that, when applied to the current | ||
| taxable value for the district, as certified by the chief appraiser | ||
| under Section 26.01, Tax Code, and as adjusted to reflect changes | ||
| made by the chief appraiser as of the time the notice is prepared, | ||
| would impose taxes in an amount that, when added to state funds to | ||
| be distributed to the district under Chapter 48, would provide the | ||
| same amount of maintenance and operations taxes and state funds | ||
| distributed under Chapter 48 per student in average daily | ||
| attendance for the applicable school year that was available to the | ||
| district in the preceding school year; and | ||
| (b) in the case of "Interest & Sinking | ||
| Fund," is the tax rate that, when applied to the current taxable | ||
| value for the district, as certified by the chief appraiser under | ||
| Section 26.01, Tax Code, and as adjusted to reflect changes made by | ||
| the chief appraiser as of the time the notice is prepared, and when | ||
| multiplied by the district's anticipated collection rate, would | ||
| impose taxes in an amount that, when added to state funds to be | ||
| distributed to the district under Chapter 46 and any excess taxes | ||
| collected to service the district's debt during the preceding tax | ||
| year but not used for that purpose during that year, would provide | ||
| the amount required to service the district's debt; and | ||
| (iii) the "Proposed Rate"; | ||
| (B) contain fourth and fifth columns aligned with | ||
| the columns required by Paragraph (A) that show, for each row | ||
| required by Paragraph (A): | ||
| (i) the "Local Revenue per Student," which | ||
| is computed by multiplying the district's total taxable value of | ||
| property, as certified by the chief appraiser for the applicable | ||
| school year under Section 26.01, Tax Code, and as adjusted to | ||
| reflect changes made by the chief appraiser as of the time the | ||
| notice is prepared, by the total tax rate, and dividing the product | ||
| by the number of students in average daily attendance in the | ||
| district for the applicable school year; and | ||
| (ii) the "State Revenue per Student," which | ||
| is computed by determining the amount of state aid received or to be | ||
| received by the district under Chapters 43, 46, and 48 and dividing | ||
| that amount by the number of students in average daily attendance in | ||
| the district for the applicable school year; and | ||
| (C) contain an asterisk after each calculation | ||
| for "Interest & Sinking Fund" and a footnote to the section that, in | ||
| reduced type, states "The Interest & Sinking Fund tax revenue is | ||
| used to pay for bonded indebtedness on construction, equipment, or | ||
| both. The bonds, and the tax rate necessary to pay those bonds, | ||
| were approved by the voters of this district."; | ||
| (6) contain a section entitled "Comparison of Proposed | ||
| Levy with Last Year's Levy on Average Residence," which must: | ||
| (A) show in rows the information described by | ||
| Subparagraphs (i)-(iv), rounded to the nearest dollar, for columns | ||
| entitled "Last Year" and "This Year": | ||
| (i) "Average Market Value of Residences," | ||
| determined using the same group of residences for each year; | ||
| (ii) "Average Taxable Value of Residences," | ||
| determined after taking into account the limitation on the | ||
| appraised value of residences under Section 23.23, Tax Code, and | ||
| after subtracting all homestead exemptions applicable in each year, | ||
| other than exemptions available only to disabled persons or persons | ||
| 65 years of age or older or their surviving spouses, and using the | ||
| same group of residences for each year; | ||
| (iii) "Last Year's Rate Versus Proposed | ||
| Rate per $100 Value"; and | ||
| (iv) "Taxes Due on Average Residence," | ||
| determined using the same group of residences for each year; and | ||
| (B) contain the following information: "Increase | ||
| (Decrease) in Taxes" expressed in dollars and cents, which is | ||
| computed by subtracting the "Taxes Due on Average Residence" for | ||
| the preceding tax year from the "Taxes Due on Average Residence" for | ||
| the current tax year; | ||
| (7) contain the following statement in bold print: | ||
| "Under state law, the dollar amount of school taxes imposed on the | ||
| residence of a person 65 years of age or older or of the surviving | ||
| spouse of such a person, if the surviving spouse was 55 years of age | ||
| or older when the person died, may not be increased above the amount | ||
| paid in the first year after the person turned 65, regardless of | ||
| changes in tax rate or property value."; | ||
| (8) contain the following statement in bold print: | ||
| "Notice of Voter-Approval Rate: The highest tax rate the district | ||
| can adopt before requiring voter approval at an election is (the | ||
| school district voter-approval rate determined under Section | ||
| 26.08, Tax Code). This election will be automatically held if the | ||
| district adopts a rate in excess of the voter-approval rate of (the | ||
| school district voter-approval rate)."; [ |
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| (9) contain a section entitled "Fund Balances," which | ||
| must include the estimated amount of interest and sinking fund | ||
| balances and the estimated amount of maintenance and operation or | ||
| general fund balances remaining at the end of the current fiscal | ||
| year that are not encumbered with or by corresponding debt | ||
| obligation, less estimated funds necessary for the operation of the | ||
| district before the receipt of the first payment under Chapter 48 in | ||
| the succeeding school year; and | ||
| (10) contain the following statement in bold print: | ||
| "Under state law, the dollar amount of school taxes imposed on a | ||
| residence homestead that qualifies as the owner's residence | ||
| homestead for at least 25 consecutive years may not be increased | ||
| above the amount of school taxes imposed on the property in that | ||
| 25th consecutive year, regardless of changes in tax rate or | ||
| property value."[ |
||
| SECTION 10. Section 46.071, Education Code, is amended by | ||
| adding Subsection (a-2) and amending Subsections (b) and (c) to | ||
| read as follows: | ||
| (a-2) Beginning with the 2023-2024 school year, in addition | ||
| to state aid a school district is entitled to under Subsection (a), | ||
| a school district is also entitled to additional state aid under | ||
| this subchapter to the extent that state and local revenue used to | ||
| service debt eligible under this chapter is less than the state and | ||
| local revenue that would have been available to the district under | ||
| this chapter as it existed on September 1, 2022, if the exemption | ||
| for an individual's first residence homestead under Section 1-b(q), | ||
| Article VIII, Texas Constitution, as proposed by the 87th | ||
| Legislature, 2nd Called Session, 2021, had not been adopted. | ||
| (b) Subject to Subsections (c)-(e), additional state aid | ||
| under this section is equal to the amount by which the loss of local | ||
| interest and sinking revenue for debt service attributable to the | ||
| increase in the residence homestead exemption under Section 1-b(c), | ||
| Article VIII, Texas Constitution, and the additional limitation on | ||
| tax increases under Section 1-b(d) of that article as proposed by | ||
| S.J.R. 1, 84th Legislature, Regular Session, 2015, and the | ||
| residence homestead exemption under Section 1-b(q), Article VIII, | ||
| Texas Constitution, as proposed by the 87th Legislature, 2nd Called | ||
| Session, 2021, is not offset by a gain in state aid under this | ||
| chapter. | ||
| (c) For the purpose of determining state aid under | ||
| Subsection (a) or (a-2) [ |
||
| revenue for debt service is limited to revenue required to service | ||
| debt eligible under this chapter as of September 1, 2015, or as of | ||
| September 1, 2022, respectively, including refunding of the | ||
| applicable [ |
||
| imposed by Section 46.034(a) does not apply for the purpose of | ||
| determining state aid under Subsection (a) or (a-2) [ |
||
| SECTION 11. Subchapter F, Chapter 48, Education Code, is | ||
| amended by adding Section 48.2541 to read as follows: | ||
| Sec. 48.2541. ADDITIONAL STATE AID FOR HOMESTEAD EXEMPTION. | ||
| (a) Beginning with the 2023-2024 school year, a school district is | ||
| entitled to additional state aid to the extent that state and local | ||
| revenue under this chapter and Chapter 49 is less than the state and | ||
| local revenue that would have been available to the district under | ||
| Chapter 49 and this chapter as those chapters existed on September | ||
| 1, 2022, if the exemption for an individual's first residence | ||
| homestead under Section 1-b(q), Article VIII, Texas Constitution, | ||
| as proposed by the joint resolution to add that subsection adopted | ||
| by the 87th Legislature, 2nd Called Session, 2021, had not been | ||
| adopted. | ||
| (b) The lesser of the school district's currently adopted | ||
| maintenance and operations tax rate or the adopted maintenance and | ||
| operations tax rate for the 2022 tax year is used for the purpose of | ||
| determining additional state aid under Subsection (a). | ||
| SECTION 12. Sections 403.302(d), (d-1), and (i), Government | ||
| Code, are amended to read as follows: | ||
| (d) For the purposes of this section, "taxable value" means | ||
| the market value of all taxable property less: | ||
| (1) the total dollar amount of any residence homestead | ||
| exemptions lawfully granted under Section 11.13(b) or (c), Tax | ||
| Code, in the year that is the subject of the study for each school | ||
| district; | ||
| (2) one-half of the total dollar amount of any | ||
| residence homestead exemptions granted under Section 11.13(n), Tax | ||
| Code, in the year that is the subject of the study for each school | ||
| district; | ||
| (3) the total dollar amount of any exemptions granted | ||
| before May 31, 1993, within a reinvestment zone under agreements | ||
| authorized by Chapter 312, Tax Code; | ||
| (4) subject to Subsection (e), the total dollar amount | ||
| of any captured appraised value of property that: | ||
| (A) is within a reinvestment zone created on or | ||
| before May 31, 1999, or is proposed to be included within the | ||
| boundaries of a reinvestment zone as the boundaries of the zone and | ||
| the proposed portion of tax increment paid into the tax increment | ||
| fund by a school district are described in a written notification | ||
| provided by the municipality or the board of directors of the zone | ||
| to the governing bodies of the other taxing units in the manner | ||
| provided by former Section 311.003(e), Tax Code, before May 31, | ||
| 1999, and within the boundaries of the zone as those boundaries | ||
| existed on September 1, 1999, including subsequent improvements to | ||
| the property regardless of when made; | ||
| (B) generates taxes paid into a tax increment | ||
| fund created under Chapter 311, Tax Code, under a reinvestment zone | ||
| financing plan approved under Section 311.011(d), Tax Code, on or | ||
| before September 1, 1999; and | ||
| (C) is eligible for tax increment financing under | ||
| Chapter 311, Tax Code; | ||
| (5) the total dollar amount of any captured appraised | ||
| value of property that: | ||
| (A) is within a reinvestment zone: | ||
| (i) created on or before December 31, 2008, | ||
| by a municipality with a population of less than 18,000; and | ||
| (ii) the project plan for which includes | ||
| the alteration, remodeling, repair, or reconstruction of a | ||
| structure that is included on the National Register of Historic | ||
| Places and requires that a portion of the tax increment of the zone | ||
| be used for the improvement or construction of related facilities | ||
| or for affordable housing; | ||
| (B) generates school district taxes that are paid | ||
| into a tax increment fund created under Chapter 311, Tax Code; and | ||
| (C) is eligible for tax increment financing under | ||
| Chapter 311, Tax Code; | ||
| (6) the total dollar amount of any exemptions granted | ||
| under Section 11.251 or 11.253, Tax Code; | ||
| (7) the difference between the comptroller's estimate | ||
| of the market value and the productivity value of land that | ||
| qualifies for appraisal on the basis of its productive capacity, | ||
| except that the productivity value estimated by the comptroller may | ||
| not exceed the fair market value of the land; | ||
| (8) the portion of the appraised value of residence | ||
| homesteads of individuals who receive a tax limitation under | ||
| Section 11.26 or 11.262, Tax Code, on which school district taxes | ||
| are not imposed in the year that is the subject of the study, | ||
| calculated as if the residence homesteads were appraised at the | ||
| full value required by law; | ||
| (9) a portion of the market value of property not | ||
| otherwise fully taxable by the district at market value because of | ||
| action required by statute or the constitution of this state, other | ||
| than Section 11.311, Tax Code, that, if the tax rate adopted by the | ||
| district is applied to it, produces an amount equal to the | ||
| difference between the tax that the district would have imposed on | ||
| the property if the property were fully taxable at market value and | ||
| the tax that the district is actually authorized to impose on the | ||
| property, if this subsection does not otherwise require that | ||
| portion to be deducted; | ||
| (10) the market value of all tangible personal | ||
| property, other than manufactured homes, owned by a family or | ||
| individual and not held or used for the production of income; | ||
| (11) the appraised value of property the collection of | ||
| delinquent taxes on which is deferred under Section 33.06, Tax | ||
| Code; | ||
| (12) the portion of the appraised value of property | ||
| the collection of delinquent taxes on which is deferred under | ||
| Section 33.065, Tax Code; | ||
| (13) the amount by which the market value of real | ||
| property [ |
||
| applies exceeds the appraised value of that property as calculated | ||
| under that section; and | ||
| (14) the total dollar amount of any exemptions granted | ||
| under Section 11.35, Tax Code. | ||
| (d-1) For purposes of Subsection (d), a residence homestead | ||
| that receives an exemption under Section 11.13(s), 11.131, 11.133, | ||
| or 11.134, Tax Code, in the year that is the subject of the study is | ||
| not considered to be taxable property. | ||
| (i) If the comptroller determines in the study that the | ||
| market value of property in a school district as determined by the | ||
| appraisal district that appraises property for the school district, | ||
| less the total of the amounts and values listed in Subsection (d) as | ||
| determined by that appraisal district, is valid, the comptroller, | ||
| in determining the taxable value of property in the school district | ||
| under Subsection (d), shall for purposes of Subsection (d)(13) | ||
| subtract from the market value as determined by the appraisal | ||
| district of properties [ |
||
| 23.23, Tax Code, applies the amount by which that amount exceeds the | ||
| appraised value of those properties as calculated by the appraisal | ||
| district under Section 23.23, Tax Code. If the comptroller | ||
| determines in the study that the market value of property in a | ||
| school district as determined by the appraisal district that | ||
| appraises property for the school district, less the total of the | ||
| amounts and values listed in Subsection (d) as determined by that | ||
| appraisal district, is not valid, the comptroller, in determining | ||
| the taxable value of property in the school district under | ||
| Subsection (d), shall for purposes of Subsection (d)(13) subtract | ||
| from the market value as estimated by the comptroller of properties | ||
| [ |
||
| the amount by which that amount exceeds the appraised value of those | ||
| properties as calculated by the appraisal district under Section | ||
| 23.23, Tax Code. | ||
| SECTION 13. Section 11.13(s), Tax Code, as added by this | ||
| Act, applies only to the appraisal for ad valorem tax purposes of | ||
| residence homesteads for a tax year that begins on or after the | ||
| effective date of this Act. | ||
| SECTION 14. Section 11.262, Tax Code, as added by this Act, | ||
| applies only to ad valorem taxes imposed for a tax year that begins | ||
| on or after the effective date of this Act. | ||
| SECTION 15. Section 23.23, Tax Code, as amended by this Act, | ||
| applies only to the appraisal for ad valorem tax purposes of | ||
| residential real property for a tax year that begins on or after the | ||
| effective date of this Act. | ||
| SECTION 16. This Act takes effect January 1, 2023, but only | ||
| if the constitutional amendment proposed by the 87th Legislature, | ||
| 2nd Called Session, 2021, authorizing the legislature to limit the | ||
| maximum appraised value of residential real property for ad valorem | ||
| tax purposes to 105 percent or more of the appraised value of the | ||
| property for the preceding tax year, to exempt from ad valorem | ||
| taxation the total appraised value of property purchased by an | ||
| individual for the first tax year the individual qualifies the | ||
| property as the individual's residence homestead if the property is | ||
| the individual's first residence homestead and has an appraised | ||
| value of less than $300,000, and to limit the total amount of ad | ||
| valorem taxes that a political subdivision may impose on the | ||
| residence homestead of an individual and the surviving spouse of | ||
| the individual if the individual qualifies the property as the | ||
| individual's residence homestead for at least 25 consecutive tax | ||
| years is approved by the voters. If that constitutional amendment | ||
| is not approved by the voters, this Act has no effect. | ||
