Bill Text: TX HB4 | 2017 | 85th Legislature 1st Special Session | Comm Sub


Bill Title: Relating to the calculation of the ad valorem rollback tax rate of a taxing unit and voter approval of a proposed tax rate that exceeds the rollback tax rate.

Spectrum: Partisan Bill (Republican 50-1)

Status: (Introduced - Dead) 2017-07-31 - Committee report sent to Calendars [HB4 Detail]

Download: Texas-2017-HB4-Comm_Sub.html
  85S11945 SMH-D
 
  By: Bonnen of Brazoria, Raymond, Shine, H.B. No. 4
      Murphy, Darby, et al.
 
  Substitute the following for H.B. No. 4:
 
  By:  Springer C.S.H.B. No. 4
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the calculation of the ad valorem rollback tax rate of a
  taxing unit and voter approval of a proposed tax rate that exceeds
  the rollback tax rate.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 26.012, Tax Code, is amended by adding
  Subdivision (18) to read as follows:
               (18)  "Small taxing unit" means:
                     (A)  a taxing unit, other than a school district,
  for which the maintenance and operations tax rate proposed for the
  current tax year:
                           (i)  is two cents or less per $100 of taxable
  value; or
                           (ii)  would impose taxes of $25 million or
  less when applied to the current total value for the taxing unit; or
                     (B)  a junior college district.
         SECTION 2.  Section 26.04, Tax Code, is amended by amending
  Subsection (c) and adding Subsection (c-1) to read as follows:
         (c)  An officer or employee designated by the governing body
  shall calculate the effective tax rate and the rollback tax rate for
  the unit, where:
               (1)  "Effective tax rate" means a rate expressed in
  dollars per $100 of taxable value calculated according to the
  following formula:
         EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY
  LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
         ; and
               (2)  "Rollback tax rate" means a rate expressed in
  dollars per $100 of taxable value calculated according to the
  following applicable formula:
                     (A)  for a small taxing unit:
         ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
  OPERATIONS RATE x 1.08) + CURRENT DEBT RATE
         ; or
                     (B)  for a taxing unit other than a small taxing
  unit:
         ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
  OPERATIONS RATE x 1.06) + CURRENT DEBT RATE
         (c-1)  Notwithstanding any other provision of this section,
  the governing body of a taxing unit other than a small taxing unit
  may direct the designated officer or employee to calculate the
  rollback tax rate of the unit according to the formula applicable to
  a small taxing unit if any part of the unit is located in an area
  declared a disaster area during the current tax year by the governor
  or by the president of the United States.  The designated officer or
  employee at the direction of the governing body may continue
  calculating the rollback tax rate in the manner provided by this
  subsection until the earlier of:
               (1)  the first tax year in which the total taxable value
  of property taxable by the taxing unit as shown on the appraisal
  roll for the taxing unit submitted by the assessor for the taxing
  unit to the governing body exceeds the total taxable value of
  property taxable by the taxing unit on January 1 of the tax year in
  which the disaster occurred; or
               (2)  the third tax year after the tax year in which the
  disaster occurred.
         SECTION 3.  Section 26.041, Tax Code, is amended by amending
  Subsections (a), (b), and (c) and adding Subsection (c-1) to read as
  follows:
         (a)  In the first year in which an additional sales and use
  tax is required to be collected, the effective tax rate and rollback
  tax rate for the unit are calculated according to the following
  formulas:
         EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
  LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] -
  SALES TAX GAIN RATE
 
  [and]
 
         ROLLBACK TAX RATE FOR SMALL TAXING UNIT = (EFFECTIVE
  MAINTENANCE AND OPERATIONS RATE x 1.08) + CURRENT DEBT
  RATE - SALES TAX GAIN RATE
 
  and
 
         ROLLBACK TAX RATE FOR TAXING UNIT OTHER THAN SMALL
  TAXING UNIT = (EFFECTIVE MAINTENANCE AND OPERATIONS
  RATE x 1.06) + CURRENT DEBT RATE - SALES TAX GAIN RATE
  where "sales tax gain rate" means a number expressed in dollars per
  $100 of taxable value, calculated by dividing the revenue that will
  be generated by the additional sales and use tax in the following
  year as calculated under Subsection (d) [of this section] by the
  current total value.
         (b)  Except as provided by Subsections (a) and (c) [of this
  section], in a year in which a taxing unit imposes an additional
  sales and use tax, the rollback tax rate for the unit is calculated
  according to the following applicable formula, regardless of
  whether the unit levied a property tax in the preceding year:
         ROLLBACK TAX RATE FOR SMALL TAXING UNIT = [(LAST YEAR'S
  MAINTENANCE AND OPERATIONS EXPENSE x 1.08) / ([TOTAL]
  CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] + (CURRENT
  DEBT RATE - SALES TAX REVENUE RATE)
 
  or
 
         ROLLBACK TAX RATE FOR TAXING UNIT OTHER THAN SMALL
  TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND OPERATIONS
  EXPENSE x 1.06) / (CURRENT TOTAL VALUE - NEW PROPERTY
  VALUE)] + (CURRENT DEBT RATE - SALES TAX REVENUE RATE)
  where "last year's maintenance and operations expense" means the
  amount spent for maintenance and operations from property tax and
  additional sales and use tax revenues in the preceding year, and
  "sales tax revenue rate" means a number expressed in dollars per
  $100 of taxable value, calculated by dividing the revenue that will
  be generated by the additional sales and use tax in the current year
  as calculated under Subsection (d) [of this section] by the current
  total value.
         (c)  In a year in which a taxing unit that has been imposing
  an additional sales and use tax ceases to impose an additional sales
  and use tax, the effective tax rate and rollback tax rate for the
  unit are calculated according to the following formulas:
         EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
  LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
  SALES TAX LOSS RATE
 
  [and]
 
         ROLLBACK TAX RATE FOR SMALL TAXING UNIT = [(LAST YEAR'S
  MAINTENANCE AND OPERATIONS EXPENSE x 1.08) / ([TOTAL]
  CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] + CURRENT
  DEBT RATE
 
  and
 
         ROLLBACK TAX RATE FOR TAXING UNIT OTHER THAN SMALL
  TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND OPERATIONS
  EXPENSE x 1.06) / (CURRENT TOTAL VALUE - NEW PROPERTY
  VALUE)] + CURRENT DEBT RATE
  where "sales tax loss rate" means a number expressed in dollars per
  $100 of taxable value, calculated by dividing the amount of sales
  and use tax revenue generated in the last four quarters for which
  the information is available by the current total value and "last
  year's maintenance and operations expense" means the amount spent
  for maintenance and operations from property tax and additional
  sales and use tax revenues in the preceding year.
         (c-1)  Notwithstanding any other provision of this section,
  the governing body of a taxing unit other than a small taxing unit
  may direct the designated officer or employee to calculate the
  rollback tax rate of the unit according to the formula applicable to
  a small taxing unit if any part of the unit is located in an area
  declared a disaster area during the current tax year by the governor
  or by the president of the United States.  The designated officer or
  employee at the direction of the governing body may continue
  calculating the rollback tax rate in the manner provided by this
  subsection until the earlier of:
               (1)  the first tax year in which the total taxable value
  of property taxable by the taxing unit as shown on the appraisal
  roll for the taxing unit submitted by the assessor for the taxing
  unit to the governing body exceeds the total taxable value of
  property taxable by the taxing unit on January 1 of the tax year in
  which the disaster occurred; or
               (2)  the third tax year after the tax year in which the
  disaster occurred.
         SECTION 4.  The heading to Section 26.043, Tax Code, is
  amended to read as follows:
         Sec. 26.043.  ROLLBACK AND EFFECTIVE TAX RATES [RATE] IN
  CITY IMPOSING MASS TRANSIT SALES AND USE TAX.
         SECTION 5.  The heading to Section 26.07, Tax Code, is
  amended to read as follows:
         Sec. 26.07.  ELECTION TO REDUCE TAX RATE OF SMALL TAXING UNIT 
  [REPEAL INCREASE].
         SECTION 6.  Section 26.07(a), Tax Code, is amended to read as
  follows:
         (a)  If the governing body of a small taxing unit [other than
  a school district] adopts a tax rate that exceeds the taxing unit's 
  rollback tax rate calculated as provided by this chapter, the
  qualified voters of the taxing unit by petition may require that an
  election be held to determine whether or not to reduce the tax rate
  adopted for the current year to the rollback tax rate calculated as
  provided by this chapter.
         SECTION 7.  The heading to Section 26.08, Tax Code, is
  amended to read as follows:
         Sec. 26.08.  ELECTION TO APPROVE TAX RATE OF TAXING UNIT
  OTHER THAN SMALL TAXING UNIT [RATIFY SCHOOL TAXES].
         SECTION 8.  Section 26.08, Tax Code, is amended by amending
  Subsections (a), (b), (d), (d-1), (d-2), (e), and (h) and adding
  Subsection (r) to read as follows:
         (a)  If the governing body of a taxing unit other than a small
  taxing unit [school district] adopts a tax rate that exceeds the
  taxing unit's [district's] rollback tax rate, the registered voters
  of the taxing unit [district] at an election held for that purpose
  must determine whether to approve the adopted tax rate. When
  increased expenditure of money by a school district is necessary to
  respond to a disaster, including a tornado, hurricane, flood, or
  other calamity, but not including a drought, that has impacted the
  [a] school district and the governor has requested federal disaster
  assistance for the area in which the school district is located, an
  election is not required under this section to approve the tax rate
  adopted by the governing body for the year following the year in
  which the disaster occurs.
         (b)  The governing body shall order that the election be held
  in the taxing unit [school district] on a date not less than 30 or
  more than 90 days after the day on which it adopted the tax rate.
  Section 41.001, Election Code, does not apply to the election
  unless a date specified by that section falls within the time
  permitted by this section. At the election, the ballots shall be
  prepared to permit voting for or against the proposition:
  "Approving the ad valorem tax rate of $_____ per $100 valuation in
  (name of taxing unit [school district]) for the current year, a rate
  that is $_____ higher per $100 valuation than the [school district]
  rollback tax rate of (name of taxing unit), for the purpose of
  (description of purpose of increase)." The ballot proposition must
  include the adopted tax rate and the difference between that rate
  and the rollback tax rate in the appropriate places.
         (d)  If the proposition is not approved as provided by
  Subsection (c), the governing body may not adopt a tax rate for the
  taxing unit [school district] for the current year that exceeds the
  taxing unit's [school district's] rollback tax rate.
         (d-1)  If, after tax bills for the taxing unit [school
  district] have been mailed, a proposition to approve the taxing
  unit's [school district's] adopted tax rate is not approved by the
  voters of the taxing unit [district] at an election held under this
  section, on subsequent adoption of a new tax rate by the governing
  body of the taxing unit [district], the assessor for the taxing unit
  [school] shall prepare and mail corrected tax bills. The assessor
  shall include with each bill a brief explanation of the reason for
  and effect of the corrected bill. The date on which the taxes
  become delinquent for the year is extended by a number of days equal
  to the number of days between the date the first tax bills were sent
  and the date the corrected tax bills were sent.
         (d-2)  If a property owner pays taxes calculated using the
  originally adopted tax rate of the taxing unit [school district]
  and the proposition to approve the adopted tax rate is not approved
  by the voters, the taxing unit [school district] shall refund the
  difference between the amount of taxes paid and the amount due under
  the subsequently adopted rate if the difference between the amount
  of taxes paid and the amount due under the subsequent rate is $1 or
  more. If the difference between the amount of taxes paid and the
  amount due under the subsequent rate is less than $1, the taxing
  unit [school district] shall refund the difference on request of
  the taxpayer. An application for a refund of less than $1 must be
  made within 90 days after the date the refund becomes due or the
  taxpayer forfeits the right to the refund.
         (e)  For purposes of this section, local tax funds dedicated
  to a junior college district under Section 45.105(e), Education
  Code, shall be eliminated from the calculation of the tax rate
  adopted by the governing body of a [the] school district. However,
  the funds dedicated to the junior college district are subject to
  Section 26.085.
         (h)  For purposes of this section, increases in taxable
  values and tax levies occurring within a reinvestment zone under
  Chapter 311 (Tax Increment Financing Act), in which a school [the]
  district is a participant, shall be eliminated from the calculation
  of the tax rate adopted by the governing body of the school
  district.
         (r)  Except as otherwise expressly provided by law, this
  section does not apply to a tax imposed by a taxing unit if a
  provision of an uncodified local or special law enacted by the 85th
  Legislature, Regular Session, 2017, or by an earlier legislature
  provides that Section 26.07 does not apply to a tax imposed by the
  taxing unit.
         SECTION 9.  Section 26.16(d), Tax Code, is amended to read as
  follows:
         (d)  The county assessor-collector shall post immediately
  below the table prescribed by Subsection (c) the following
  statement:
         "The county is providing this table of property tax rate
  information as a service to the residents of the county. Each
  individual taxing unit is responsible for calculating the property
  tax rates listed in this table pertaining to that taxing unit and
  providing that information to the county.
         "The adopted tax rate is the tax rate adopted by the governing
  body of a taxing unit.
         "The maintenance and operations rate is the component of the
  adopted tax rate of a taxing unit that will impose the amount of
  taxes needed to fund maintenance and operation expenditures of the
  unit for the following year.
         "The debt rate is the component of the adopted tax rate of a
  taxing unit that will impose the amount of taxes needed to fund the
  unit's debt service for the following year.
         "The effective tax rate is the tax rate that would generate
  the same amount of revenue in the current tax year as was generated
  by a taxing unit's adopted tax rate in the preceding tax year from
  property that is taxable in both the current tax year and the
  preceding tax year.
         "The effective maintenance and operations rate is the tax
  rate that would generate the same amount of revenue for maintenance
  and operations in the current tax year as was generated by a taxing
  unit's maintenance and operations rate in the preceding tax year
  from property that is taxable in both the current tax year and the
  preceding tax year.
         "The rollback tax rate is the highest tax rate a taxing unit
  may adopt before requiring voter approval at an election. In the
  case of a small taxing unit [other than a school district], the
  voters by petition may require that a rollback election be held if
  the unit adopts a tax rate in excess of the unit's rollback tax
  rate. In the case of a taxing unit other than a small taxing unit
  [school district], an election will automatically be held if the
  unit [district] wishes to adopt a tax rate in excess of the unit's
  [district's] rollback tax rate."
         SECTION 10.  Sections 31.12(a) and (b), Tax Code, as amended
  by S.B. 2242, Acts of the 85th Legislature, Regular Session, 2017,
  are amended to read as follows:
         (a)  If a refund of a tax provided by Section 11.431(b),
  26.07(g), 26.08(d-2), 26.15(f), 31.11, 31.111, or 31.112 is paid on
  or before the 60th day after the date the liability for the refund
  arises, no interest is due on the amount refunded. If not paid on or
  before that 60th day, the amount of the tax to be refunded accrues
  interest at a rate of one percent for each month or part of a month
  that the refund is unpaid, beginning with the date on which the
  liability for the refund arises.
         (b)  For purposes of this section, liability for a refund
  arises:
               (1)  if the refund is required by Section 11.431(b), on
  the date the chief appraiser notifies the collector for the unit of
  the approval of the late homestead exemption;
               (2)  if the refund is required by Section 26.07(g), on
  the date the results of the election to reduce the tax rate are
  certified;
               (3)  if the refund is required by Section 26.08(d-2),
  on the date the subsequent tax rate is adopted;
               (4)  if the refund is required by Section 26.15(f):
                     (A)  for a correction to the tax roll made under
  Section 26.15(b), on the date the change in the tax roll is
  certified to the assessor for the taxing unit under Section 25.25;
  or
                     (B)  for a correction to the tax roll made under
  Section 26.15(c), on the date the change in the tax roll is ordered
  by the governing body of the taxing unit;
               (5) [(4)]  if the refund is required by Section 31.11,
  on the date the auditor for the taxing unit determines that the
  payment was erroneous or excessive or, if the amount of the refund
  exceeds the applicable amount specified by Section 31.11(a), on the
  date the governing body of the unit approves the refund;
               (6) [(5)]  if the refund is required by Section 31.111,
  on the date the collector for the taxing unit determines that the
  payment was erroneous; or
               (7) [(6)]  if the refund is required by Section 31.112,
  on the date required by Section 31.112(d) or (e), as applicable.
         SECTION 11.  Section 33.08(b), Tax Code, is amended to read
  as follows:
         (b)  The governing body of the taxing unit or appraisal
  district, in the manner required by law for official action, may
  provide that taxes that become delinquent on or after June 1 under
  Section 26.07(f), 26.08(d-1), 26.15(e), 31.03, 31.031, 31.032,
  31.04, or 42.42 incur an additional penalty to defray costs of
  collection. The amount of the penalty may not exceed the amount of
  the compensation specified in the applicable contract with an
  attorney under Section 6.30 to be paid in connection with the
  collection of the delinquent taxes.
         SECTION 12.  Section 130.016(b), Education Code, is amended
  to read as follows:
         (b)  If the board of trustees of an independent school
  district that divests itself of the management, control, and
  operation of a junior college district under this section or under
  Section 130.017 [of this code] was authorized by [Subsection (e)
  of] Section 45.105(e) or under former Section 20.48(e) [20.48 of
  this code] to dedicate a portion of its tax levy to the junior
  college district before the divestment, the junior college district
  may levy an ad valorem tax from and after the divestment. In the
  first two years in which the junior college district levies an ad
  valorem tax, the tax rate adopted by the governing body may not
  exceed the rate that, if applied to the total taxable value
  submitted to the governing body under Section 26.04, Tax Code,
  would impose an amount equal to the amount of taxes of the school
  district dedicated to the junior college under [Subsection (e) of]
  Section 45.105(e) or former Section 20.48(e) [20.48 of this code]
  in the last dedication before the divestment. In subsequent years,
  the tax rate of the junior college district is subject to Section
  26.07 or 26.08, Tax Code, as applicable.
         SECTION 13.  Sections 281.124(d) and (e), Health and Safety
  Code, are amended to read as follows:
         (d)  If a majority of the votes cast in the election favor the
  proposition, the tax rate for the specified tax year is the rate
  approved by the voters, and that rate is not subject to a rollback
  election under Section 26.07 or 26.08, Tax Code. The board shall
  adopt the tax rate as provided by Chapter 26, Tax Code, as
  applicable.
         (e)  If the proposition is not approved as provided by
  Subsection (c), the board may not adopt a tax rate for the district
  for the specified tax year that exceeds the rate that was not
  approved, and Section 26.07 or 26.08, Tax Code, as applicable,
  applies to the adopted rate if that rate exceeds the district's
  rollback tax rate.
         SECTION 14.  Section 140.010, Local Government Code, is
  amended by amending Subsections (a), (e), (f), and (g) and adding
  Subsection (e-1) to read as follows:
         (a)  In this section:
               (1)  "Effective[, "effective] tax rate" and "rollback
  tax rate" mean the effective tax rate and rollback tax rate of a
  county or municipality, as applicable, as calculated under Chapter
  26, Tax Code.
               (2)  "Small taxing unit" has the meaning assigned by
  Section 26.012, Tax Code.
         (e)  A county or municipality that is a small taxing unit and
  that proposes a property tax rate that exceeds the lower of the
  effective tax rate or the rollback tax rate shall provide the
  following notice:
  "NOTICE OF (INSERT CURRENT TAX YEAR) TAX YEAR PROPOSED PROPERTY TAX
  RATE FOR (INSERT NAME OF COUNTY OR MUNICIPALITY)
  "A tax rate of $_____ per $100 valuation has been proposed for
  adoption by the governing body of (insert name of county or
  municipality). This rate exceeds the lower of the effective or
  rollback tax rate, and state law requires that two public hearings
  be held by the governing body before adopting the proposed tax rate.
  The governing body of (insert name of county or municipality)
  proposes to use revenue attributable to the tax rate increase for
  the purpose of (description of purpose of increase).
         PROPOSED TAX RATE$______ per $100       
         PRECEDING YEAR'S TAX RATE$______ per $100       
         EFFECTIVE TAX RATE$______ per $100       
         ROLLBACK TAX RATE$______ per $100       
  "The effective tax rate is the total tax rate needed to raise the
  same amount of property tax revenue for (insert name of county or
  municipality) from the same properties in both the (insert
  preceding tax year) tax year and the (insert current tax year) tax
  year.
  "The rollback tax rate is the highest tax rate that (insert name of
  county or municipality) may adopt before the voters are entitled to
  petition for an election to limit the rate that may be approved to
  the rollback tax rate.
  "YOUR TAXES OWED UNDER ANY OF THE ABOVE RATES CAN BE CALCULATED AS
  FOLLOWS:
  property tax amount = (rate) x (taxable value of your property) /
  100
  "For assistance or detailed information about tax calculations,
  please contact:
         (insert name of county or municipal tax assessor-collector)
         (insert name of county or municipality) tax
  assessor-collector
         (insert address)
         (insert telephone number)
         (insert e-mail address)
         (insert Internet website address, if applicable)
  "You are urged to attend and express your views at the following
  public hearings on the proposed tax rate:
         First Hearing: (insert date and time) at (insert location of
  meeting).
         Second Hearing: (insert date and time) at (insert location
  of meeting)."
         (e-1)  A county or municipality that is not a small taxing
  unit and that proposes a property tax rate that exceeds the lower of
  the effective tax rate or the rollback tax rate shall provide the
  following notice:
  "NOTICE OF (INSERT CURRENT TAX YEAR) TAX YEAR PROPOSED PROPERTY TAX
  RATE FOR (INSERT NAME OF COUNTY OR MUNICIPALITY)
  "A tax rate of $_____ per $100 valuation has been proposed for
  adoption by the governing body of (insert name of county or
  municipality). This rate exceeds the lower of the effective or
  rollback tax rate, and state law requires that two public hearings
  be held by the governing body before adopting the proposed tax rate.
  The governing body of (insert name of county or municipality)
  proposes to use revenue attributable to the tax rate increase for
  the purpose of (description of purpose of increase).
         PROPOSED TAX RATE$______ per $100       
         PRECEDING YEAR'S TAX RATE$______ per $100       
         EFFECTIVE TAX RATE$______ per $100       
         ROLLBACK TAX RATE$______ per $100       
  "The effective tax rate is the total tax rate needed to raise the
  same amount of property tax revenue for (insert name of county or
  municipality) from the same properties in both the (insert
  preceding tax year) tax year and the (insert current tax year) tax
  year.
  "The rollback tax rate is the highest tax rate that (insert name of
  county or municipality) may adopt before the (insert "county" or
  "city") is required to hold an election to limit the rate that may
  be approved to the rollback tax rate.
  "YOUR TAXES OWED UNDER ANY OF THE ABOVE RATES CAN BE CALCULATED AS
  FOLLOWS:
  property tax amount = (rate) x (taxable value of your property) /
  100
  "For assistance or detailed information about tax calculations,
  please contact:
         (insert name of county or municipal tax assessor-collector)
         (insert name of county or municipality) tax
  assessor-collector
         (insert address)
         (insert telephone number)
         (insert e-mail address)
         (insert Internet website address, if applicable)
  "You are urged to attend and express your views at the following
  public hearings on the proposed tax rate:
         First Hearing: (insert date and time) at (insert location of
  meeting).
         Second Hearing: (insert date and time) at (insert location
  of meeting)."
         (f)  A county or municipality shall:
               (1)  provide the notice required by Subsection (d),
  [or] (e), or (e-1), as applicable, not later than the later of
  September 1 or the 30th day after the first date that the taxing
  unit has received each applicable certified appraisal roll by:
                     (A)  publishing the notice in a newspaper having
  general circulation in:
                           (i)  the county, in the case of notice
  published by a county; or
                           (ii)  the county in which the municipality
  is located or primarily located, in the case of notice published by
  a municipality; or
                     (B)  mailing the notice to each property owner in:
                           (i)  the county, in the case of notice
  provided by a county; or
                           (ii)  the municipality, in the case of
  notice provided by a municipality; and
               (2)  post the notice on the Internet website of the
  county or municipality, if applicable, beginning not later than the
  later of September 1 or the 30th day after the first date that the
  taxing unit has received each applicable certified appraisal roll
  and continuing until the county or municipality adopts a tax rate.
         (g)  If the notice required by Subsection (d), [or] (e), or
  (e-1) is published in a newspaper:
               (1)  the notice may not be smaller than one-quarter
  page of a standard-size or a tabloid-size newspaper; and
               (2)  the headline on the notice must be in 24-point or
  larger type.
         SECTION 15.  Section 1122.2522, Special District Local Laws
  Code, is amended by amending Subsection (a) and adding Subsection
  (a-1) to read as follows:
         (a)  If in any year the board adopts a tax rate that exceeds
  the rollback tax rate calculated as provided by Chapter 26, Tax
  Code, and the district is a small taxing unit as defined by Section
  26.012 of that code, the qualified voters of the district by
  petition may require that an election be held to determine whether
  or not to reduce the tax rate adopted by the board for that year to
  the rollback tax rate.
         (a-1)  If in any year the board adopts a tax rate that exceeds
  the rollback tax rate calculated as provided by Chapter 26, Tax
  Code, and the district is not a small taxing unit as defined by
  Section 26.012 of that code, an election must be held to determine
  whether or not to approve the tax rate adopted by the board for that
  year.
         SECTION 16.  Sections 3828.157 and 8876.152, Special
  District Local Laws Code, are amended to read as follows:
         Sec. 3828.157.  INAPPLICABILITY OF CERTAIN TAX CODE
  PROVISIONS. Sections 26.04, 26.05, [and] 26.07, and 26.08, Tax
  Code, do not apply to a tax imposed under Section 3828.153 or
  3828.156.
         Sec. 8876.152.  APPLICABILITY OF CERTAIN TAX PROVISIONS.
  (a) Sections 26.04, 26.05, 26.06, [and] 26.07, and 26.08, Tax Code,
  do not apply to a tax imposed by the district.
         (b)  Sections 49.236(a)(1) and (2) and (b) [Section 49.236],
  Water Code, apply [as added by Chapter 248 (H.B. 1541), Acts of the
  78th Legislature, Regular Session, 2003, applies] to the district.
         SECTION 17.  Section 49.107(g), Water Code, is amended to
  read as follows:
         (g)  Sections 26.04, 26.05, [and] 26.07, and 26.08, Tax Code,
  do not apply to a tax levied and collected under this section or an
  ad valorem tax levied and collected for the payment of the interest
  on and principal of bonds issued by a district.
         SECTION 18.  Section 49.108(f), Water Code, is amended to
  read as follows:
         (f)  Sections 26.04, 26.05, [and] 26.07, and 26.08, Tax Code,
  do not apply to a tax levied and collected for payments made under a
  contract approved in accordance with this section.
         SECTION 19.  Section 49.236, Water Code, as added by Chapter
  335 (S.B. 392), Acts of the 78th Legislature, Regular Session,
  2003, is amended by amending Subsections (a) and (d) and adding
  Subsections (e), (f), (g), (h), (i), (j), (k), (l), and (m) to read
  as follows:
         (a)  Before the board adopts an ad valorem tax rate for the
  district for debt service, operation and maintenance purposes, or
  contract purposes, the board shall give notice of each meeting of
  the board at which the adoption of a tax rate will be considered.
  The notice must:
               (1)  contain a statement in substantially the following
  form:
  "NOTICE OF PUBLIC HEARING ON TAX RATE
         "The (name of the district) will hold a public hearing on a
  proposed tax rate for the tax year (year of tax levy) on (date and
  time) at (meeting place). Your individual taxes may increase or
  decrease, depending on the change in the taxable value of your
  property in relation to the change in taxable value of all other
  property and the tax rate that is adopted.
         "(Names of all board members and, if a vote was taken, an
  indication of how each voted on the proposed tax rate and an
  indication of any absences.)";
               (2)  contain the following information:
                     (A)  the district's total adopted tax rate for the
  preceding year and the proposed tax rate, expressed as an amount per
  $100;
                     (B)  the difference, expressed as an amount per
  $100 and as a percent increase or decrease, as applicable, in the
  proposed tax rate compared to the adopted tax rate for the preceding
  year;
                     (C)  the average appraised value of a residence
  homestead in the district in the preceding year and in the current
  year; the district's total homestead exemption, other than an
  exemption available only to disabled persons or persons 65 years of
  age or older, applicable to that appraised value in each of those
  years; and the average taxable value of a residence homestead in
  the district in each of those years, disregarding any homestead
  exemption available only to disabled persons or persons 65 years of
  age or older;
                     (D)  the amount of tax that would have been
  imposed by the district in the preceding year on a residence
  homestead appraised at the average appraised value of a residence
  homestead in that year, disregarding any homestead exemption
  available only to disabled persons or persons 65 years of age or
  older;
                     (E)  the amount of tax that would be imposed by the
  district in the current year on a residence homestead appraised at
  the average appraised value of a residence homestead in that year,
  disregarding any homestead exemption available only to disabled
  persons or persons 65 years of age or older, if the proposed tax
  rate is adopted; [and]
                     (F)  the difference between the amounts of tax
  calculated under Paragraphs (D) and (E), expressed in dollars and
  cents and described as the annual percentage increase or decrease,
  as applicable, in the tax to be imposed by the district on the
  average residence homestead in the district in the current year if
  the proposed tax rate is adopted; and
                     (G)  if the proposed combined debt service,
  operation and maintenance, and contract tax rate authorizes or
  requires an election in the district to approve the tax rate, a
  description of the purpose of the proposed tax increase; and
               (3)  contain a statement in substantially the following
  form, as applicable:
                     (A)  if the district is a small taxing unit:
  "NOTICE OF TAXPAYERS' RIGHT TO ROLLBACK ELECTION
         "If taxes on the average residence homestead increase by more
  than eight percent, the qualified voters of the district by
  petition may require that an election be held to determine whether
  to approve [reduce] the [operation and maintenance] tax rate [to
  the rollback tax rate] under Section 49.236(d), Water Code."; or
                     (B)  if the district is a taxing unit other than a
  small taxing unit:
  "NOTICE OF VOTE ON TAX RATE
         "If taxes on the average residence homestead increase by more
  than six percent, an election must be held to determine whether to
  approve the tax rate under Section 49.236(i), Water Code."
         (d)  This subsection and Subsections (e)-(h) apply to a
  district only if the district is a small taxing unit. If the board
  [governing body] of the [a] district adopts a combined debt
  service, operation and maintenance, and contract tax rate that
  would impose more than 1.08 times the amount of tax imposed by the
  district in the preceding year on a residence homestead appraised
  at the average appraised value of a residence homestead in the
  district in that year, disregarding any homestead exemption
  available only to disabled persons or persons 65 years of age or
  older, the qualified voters of the district by petition may require
  that an election be held to determine whether [or not] to approve
  [reduce] the tax rate adopted for the current year [to the rollback
  tax rate] in accordance with the procedures provided by Subsections
  (e)-(h) of this section and Section [Sections 26.07(b)-(g) and]
  26.081, Tax Code.
         (e)  A petition under Subsection (d) is valid only if:
               (1)  it states that it is intended to require an
  election in the district on the question of approving the tax rate
  adopted for the current year;
               (2)  it is signed by a number of registered voters of
  the district equal to at least:
                     (A)  seven percent of the number of registered
  voters of the district according to the most recent official list of
  registered voters if the tax rate adopted for the current tax year
  would impose taxes for operation and maintenance in an amount of at
  least $5 million; or
                     (B)  10 percent of the number of registered voters
  of the district according to the most recent official list of
  registered voters if the tax rate adopted for the current tax year
  would impose taxes for operation and maintenance in an amount of
  less than $5 million; and
               (3)  it is submitted to the board on or before the 90th
  day after the date on which the board adopted the tax rate for the
  current year.
         (f)  Not later than the 20th day after the day a petition is
  submitted, the board shall determine whether or not the petition is
  valid and pass a resolution stating its finding. If the board fails
  to act within the time allowed, the petition is treated as if it had
  been found valid.
         (g)  If the board finds that the petition is valid (or fails
  to act within the time allowed), it shall order that an election be
  held in the district on a date not less than 30 or more than 90 days
  after the last day on which it could have acted to approve or
  disapprove the petition. A state law requiring local elections to
  be held on a specified date does not apply to the election unless a
  specified date falls within the time permitted by this subsection.
  At the election, the ballots shall be prepared to permit voting for
  or against the proposition: "Approving the ad valorem tax rate of
  $____ per $100 valuation in (name of district) for the current year,
  a rate that is $____ higher per $100 valuation than the district's
  rollback tax rate, for the purpose of (description of purpose of
  increase)." The ballot proposition must include the adopted tax
  rate and the difference between that rate and the rollback tax rate
  in the appropriate places.
         (h)  Sections 26.08(c), (d), (d-1), and (d-2), Tax Code,
  apply to an election under Subsection (d) of this section in the
  same manner as those subsections apply to an election under Section
  26.08, Tax Code.
         (i)  This subsection applies to a district only if the
  district is a taxing unit other than a small taxing unit. If the
  board of the district adopts a combined debt service, operation and
  maintenance, and contract tax rate that would impose more than 1.06
  times the amount of tax imposed by the district in the preceding
  year on a residence homestead appraised at the average appraised
  value of a residence homestead in the district in that year,
  disregarding any homestead exemption available only to disabled
  persons or persons 65 years of age or older, an election must be
  held to determine whether to approve the tax rate adopted for the
  current year in accordance with the procedures provided by Sections
  26.08(b), (c), (d), (d-1), and (d-2), Tax Code.
         (j)  For purposes of Subsection (d) [Sections 26.07(b)-(g)
  and this subsection], the rollback tax rate of a district is the sum
  of the following tax rates:
               (1)  the current year's debt service tax rate;
               (2)  the current year's [and] contract tax rate; and
               (3)  [rates plus] the operation and maintenance tax
  rate that would impose 1.08 times the amount of the operation and
  maintenance tax imposed by the district in the preceding year on a
  residence homestead appraised at the average appraised value of a
  residence homestead in the district in that year, disregarding any
  homestead exemption available only to disabled persons or persons
  65 years of age or older.
         (k)  For purposes of Subsection (i), the rollback tax rate of
  a district is the sum of the following tax rates:
               (1)  the current year's debt service tax rate;
               (2)  the current year's contract tax rate; and
               (3)  the operation and maintenance tax rate that would
  impose 1.06 times the amount of the operation and maintenance tax
  imposed by the district in the preceding year on a residence
  homestead appraised at the average appraised value of a residence
  homestead in the district in that year, disregarding any homestead
  exemption available only to disabled persons or persons 65 years of
  age or older.
         (l)  Notwithstanding any other provision of this section,
  the board of a district that is a taxing unit other than a small
  taxing unit may substitute "eight percent" for "six percent" in
  Subsection (a)(3)(B) and "1.08" for "1.06" in Subsections (i) and
  (k) if any part of the district is located in an area declared a
  disaster area during the current tax year by the governor or by the
  president of the United States.  The board may continue doing so
  until the earlier of:
               (1)  the first tax year in which the total taxable value
  of property taxable by the district as shown on the appraisal roll
  for the district submitted by the assessor for the district to the
  board exceeds the total taxable value of property taxable by the
  district on January 1 of the tax year in which the disaster
  occurred; or
               (2)  the third tax year after the tax year in which the
  disaster occurred.
         (m)  In this section:
               (1)  "Small taxing unit" has the meaning assigned by
  Section 26.012, Tax Code.
               (2)  "Taxing unit" has the meaning assigned by Section
  1.04, Tax Code.
         SECTION 20.  The following provisions are repealed:
               (1)  Section 49.236, Water Code, as added by Chapter
  248 (H.B. 1541), Acts of the 78th Legislature, Regular Session,
  2003; and
               (2)  Section 49.2361, Water Code.
         SECTION 21.  This Act takes effect January 1, 2018.
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