Bill Text: TX HB162 | 2021 | 87th Legislature 2nd Special Session | Introduced
Bill Title: Relating to limitations on increases in the appraised value for ad valorem tax purposes of residence homesteads and single-family residences other than residence homesteads.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2021-08-11 - Filed [HB162 Detail]
Download: Texas-2021-HB162-Introduced.html
87S20382 TJB-D | ||
By: Capriglione | H.B. No. 162 |
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relating to limitations on increases in the appraised value for ad | ||
valorem tax purposes of residence homesteads and single-family | ||
residences other than residence homesteads. | ||
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 a | ||
residence homestead to which Section 23.23 applies or of a | ||
single-family residence other than a residence homestead to which | ||
Section 23.231 applies is the 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 or 23.231. | ||
SECTION 2. Section 23.23(a), Tax Code, is amended 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 a | ||
residence homestead for a tax year to 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. | ||
SECTION 3. Subchapter B, Chapter 23, Tax Code, is amended by | ||
adding Section 23.231 to read as follows: | ||
Sec. 23.231. LIMITATION ON APPRAISED VALUE OF SINGLE-FAMILY | ||
RESIDENCE OTHER THAN RESIDENCE HOMESTEAD. (a) In this section: | ||
(1) "New improvement" means an improvement to real | ||
property made after the most recent 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) "Qualifying trust" has the meaning assigned by | ||
Section 11.13. | ||
(3) "Single-family residence" means a structure, | ||
including a mobile home, together with the land, not to exceed 20 | ||
acres, and improvements used in the residential occupancy of the | ||
structure, if the structure and the land and improvements have | ||
identical ownership, that: | ||
(A) is owned by one or more individuals, either | ||
directly or through a beneficial interest in a qualifying trust; | ||
(B) is designed or adapted for human residence; | ||
and | ||
(C) is used as a single-family residence. | ||
(b) This section does not apply to a residence homestead | ||
that qualifies for an exemption under Section 11.13. | ||
(c) 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 a | ||
single-family residence to which this section applies for a tax | ||
year to 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) 10 percent of the appraised value of 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. | ||
(d) When appraising a single-family residence to which this | ||
section applies, the chief appraiser shall: | ||
(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 | ||
(c)(2). | ||
(e) The limitation provided by Subsection (c) takes effect | ||
as to a single-family residence on January 1 of the tax year | ||
following the first tax year in which the owner owns the property on | ||
January 1 and in which the property is used as a single-family | ||
residence. The limitation expires on January 1 of the tax year | ||
following the tax year in which the owner of the property ceases to | ||
own the property or the property ceases to be used as a | ||
single-family residence. | ||
(f) Notwithstanding Subsections (a) and (c) and except as | ||
provided by Subdivision (2) of this subsection, an improvement to | ||
real 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 (c) 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 (c); 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. | ||
(g) In this subsection, "disaster recovery program" means | ||
the disaster recovery program administered by the General Land | ||
Office or by a political subdivision of this state that is funded | ||
with community development block grant disaster recovery money | ||
authorized by federal law. Notwithstanding Subsection (f)(2), and | ||
only to the extent necessary to satisfy the requirements of the | ||
disaster recovery program, a replacement structure described by | ||
that subdivision is not considered to be a new improvement if to | ||
satisfy the requirements of the disaster recovery program it was | ||
necessary that: | ||
(1) the square footage of the replacement structure | ||
exceed that of the replaced structure as that structure existed | ||
before the casualty or damage occurred; or | ||
(2) the exterior of the replacement structure be of | ||
higher quality construction and composition than that of the | ||
replaced structure. | ||
SECTION 4. 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 or 23.231. | ||
SECTION 5. Sections 403.302(d) 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, 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 property | ||
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applies exceeds the appraised value of that property as calculated | ||
under Section 23.23 or 23.231, Tax Code, as applicable [ |
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(14) the total dollar amount of any exemptions granted | ||
under Section 11.35, Tax Code. | ||
(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 [ |
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23.23 or 23.231, 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 or 23.231, Tax Code, as | ||
applicable. 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 [ |
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Section 23.23 or 23.231, 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 or 23.231, | ||
Tax Code, as applicable. | ||
SECTION 6. This Act applies only to the appraisal of real | ||
property for ad valorem tax purposes for a tax year that begins on | ||
or after the effective date of this Act. | ||
SECTION 7. This Act takes effect January 1, 2023, but only | ||
if the constitutional amendment proposed by the 87th Legislature, | ||
2nd Called Session, 2021, to authorize the legislature to limit the | ||
maximum appraised value of a residence homestead for ad valorem tax | ||
purposes to 105 percent or more of the appraised value of the | ||
property for the preceding tax year and to limit the maximum | ||
appraised value of a single-family residence other than a residence | ||
homestead for those purposes to 110 percent or more of the appraised | ||
value of the property for the preceding tax year is approved by the | ||
voters. If that amendment is not approved by the voters, this Act | ||
has no effect. |