Bill Text: TX HB4433 | 2023-2024 | 88th Legislature | Engrossed

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to the authority of the board of directors of a tax increment financing reinvestment zone to use money in the tax increment fund established for the zone to compensate certain homeowners for the increase in taxes associated with the zone.

Spectrum: Moderate Partisan Bill (Democrat 6-1)

Status: (Engrossed - Dead) 2023-05-24 - Placed on intent calendar [HB4433 Detail]

Download: Texas-2023-HB4433-Engrossed.html
  88R6390 CJC-F
 
  By: Anchía, Gervin-Hawkins, Jones of Dallas H.B. No. 4433
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the treatment of certain residence homesteads for
  purposes of the Tax Increment Financing Act.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 311.002(1), Tax Code, is amended to read
  as follows:
               (1)  "Project costs" means the expenditures made or
  estimated to be made and monetary obligations incurred or estimated
  to be incurred by the municipality or county designating a
  reinvestment zone that are listed in the project plan as costs of
  public works, public improvements, programs, or other projects
  benefiting the zone, plus other costs incidental to those
  expenditures and obligations. "Project costs" include:
                     (A)  capital costs, including the actual costs of
  the acquisition and construction of public works, public
  improvements, new buildings, structures, and fixtures; the actual
  costs of the acquisition, demolition, alteration, remodeling,
  repair, or reconstruction of existing buildings, structures, and
  fixtures; the actual costs of the remediation of conditions that
  contaminate public or private land or buildings; the actual costs
  of the preservation of the facade of a public or private building;
  the actual costs of the demolition of public or private buildings;
  and the actual costs of the acquisition of land and equipment and
  the clearing and grading of land;
                     (B)  financing costs, including all interest paid
  to holders of evidences of indebtedness or other obligations issued
  to pay for project costs and any premium paid over the principal
  amount of the obligations because of the redemption of the
  obligations before maturity;
                     (C)  real property assembly costs;
                     (D)  professional service costs, including those
  incurred for architectural, planning, engineering, and legal
  advice and services;
                     (E)  imputed administrative costs, including
  reasonable charges for the time spent by employees of the
  municipality or county in connection with the implementation of a
  project plan;
                     (F)  relocation costs;
                     (G)  organizational costs, including the costs of
  conducting environmental impact studies or other studies, the cost
  of publicizing the creation of the zone, and the cost of
  implementing the project plan for the zone;
                     (H)  interest before and during construction and
  for one year after completion of construction, whether or not
  capitalized;
                     (I)  the cost of operating the reinvestment zone
  and project facilities;
                     (J)  the amount of any contributions made by the
  municipality or county from general revenue for the implementation
  of the project plan;
                     (K)  the costs of school buildings, other
  educational buildings, other educational facilities, or other
  buildings owned by or on behalf of a school district, community
  college district, or other political subdivision of this state;
  [and]
                     (L)  payments made at the discretion of the
  governing body of the municipality or county that the governing
  body finds necessary or convenient to the creation of the zone or to
  the implementation of the project plans for the zone; and
                     (M)  payments made as part of a reinvestment zone
  stability program established under Section 311.0111.
         SECTION 2.  Section 311.006(a), Tax Code, is amended to read
  as follows:
         (a)  A municipality may not designate a reinvestment zone if:
               (1)  more than 40 [30] percent of the property in the
  proposed zone[, excluding property that is publicly owned,] is used
  for residential purposes, excluding property that is:
                     (A)  publicly owned; or
                     (B)  a residence homestead owned by a legacy
  homeowner, as those terms are defined by Section 311.0111; or
               (2)  the total appraised value of taxable real property
  in the proposed zone and in existing reinvestment zones exceeds:
                     (A)  25 percent of the total appraised value of
  taxable real property in the municipality and in the industrial
  districts created by the municipality, if the municipality has a
  population of 100,000 or more; or
                     (B)  50 percent of the total appraised value of
  taxable real property in the municipality and in the industrial
  districts created by the municipality, if the municipality has a
  population of less than 100,000.
         SECTION 3.  Chapter 311, Tax Code, is amended by adding
  Section 311.0111 to read as follows:
         Sec. 311.0111.  REINVESTMENT ZONE STABILITY PROGRAM. (a)
  In this section:
               (1)  "Legacy homeowner" means the owner of a residence
  homestead located in a reinvestment zone who has continuously
  resided in and received an exemption under Section 11.13 for the
  homestead for at least seven years preceding the date the governing
  body of the county or municipality designated the zone in which the
  homestead is located.
               (2)  "Program" means a reinvestment zone stability
  program established under this section.
               (3)  "Residence homestead" has the meaning assigned by
  Section 11.13.
         (b)  The project plan prepared and adopted by the board of
  directors of a reinvestment zone under Section 311.011 may
  authorize the board of directors to establish a reinvestment zone
  stability program, the purpose of which is to ensure that all
  residents of the zone benefit from its designation. The governing
  body of the county or municipality that designated the zone and any
  affiliated community organizations may participate in the
  development of the program. As part of a program established under
  this section, the board may dedicate, pledge, or otherwise provide
  for the use of money in the tax increment fund established for the
  zone to prevent homeowner displacement by providing annual payments
  on behalf of legacy homeowners to offset the increase in ad valorem
  taxes imposed on the residence homesteads of those homeowners that
  is attributable to the increase in property values associated with
  the development or redevelopment of property in the zone.
         (c)  If the project plan for a reinvestment zone authorizes
  annual payments on behalf of legacy homeowners, the plan must
  provide that:
               (1)  the amount of an annual payment made under the
  program to a legacy homeowner may not exceed the amount determined
  for that homeowner under Subsection (d); and
               (2)  the period of time for which annual payments may be
  made on behalf of a legacy homeowner may not exceed 10 years.
         (d)  The maximum amount of an annual payment that may be made
  on behalf of a legacy homeowner for a tax year is equal to the
  positive difference, if any, between the following amounts:
               (1)  the ad valorem taxes due on the homeowner's
  homestead for that tax year; and
               (2)  the ad valorem taxes due on the homeowner's
  homestead for the tax year in which the reinvestment zone in which
  the homestead is located was designated.
         SECTION 4.  This Act takes effect September 1, 2023.
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