Bill Text: TX HB988 | 2021-2022 | 87th Legislature | Comm Sub

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to ad valorem taxation; creating a criminal offense.

Spectrum: Moderate Partisan Bill (Republican 13-4)

Status: (Passed) 2021-06-15 - See remarks for effective date [HB988 Detail]

Download: Texas-2021-HB988-Comm_Sub.html

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By: Shine, et al. (Senate Sponsor - Hancock) H.B. No. 988
(In the Senate - Received from the House April 27, 2021;
May 3, 2021, read first time and referred to Committee on Local
Government; May 21, 2021, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 6, Nays 0;
May 21, 2021, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR H.B. No. 988 By: Springer

A BILL TO BE ENTITLED
AN ACT
relating to ad valorem taxation; creating a criminal offense.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 5.103, Tax Code, is amended by amending
Subsection (d) and adding Subsection (e) to read as follows:
(d) An appraisal review board shall incorporate [follow]
the model hearing procedures prepared by the comptroller when
adopting the board's [establishing its] procedures for hearings as
required by Section 41.01(c). An appraisal review board may adopt
procedures that supplement the model hearing procedures, provided
that the supplemental procedures do not contradict or circumvent
the model hearing procedures.
(e) Each year the comptroller shall review the hearing
procedures adopted by each appraisal review board to determine
whether the hearing procedures incorporate the model hearing
procedures prepared by the comptroller under this section
[41.66(a)].
SECTION 2. Section 5.104(l), Tax Code, is amended to read as
follows:
(l) The comptroller shall issue an annual report that
summarizes the information included in the surveys submitted during
the preceding tax year. The report must also include a summary of
the comments, complaints, and suggestions forwarded to the
comptroller during the preceding tax year by taxpayer liaison
officers under Section 6.052(a), the results of the comptroller's
review of appraisal review board hearing procedures during the
preceding tax year under Section 5.103(e), and the results of
requests for limited binding arbitration filed with the comptroller
during the preceding tax year under Section 41A.015. The report may
not disclose the identity of an individual who submitted a survey,
comment, complaint, suggestion, or request for arbitration.
SECTION 3. Section 6.03, Tax Code, is amended by amending
Subsection (k) and adding Subsection (k-1) to read as follows:
(k) Except as provided by Subsection (k-1), the [The]
governing body of each taxing unit entitled to vote shall determine
its vote by resolution and submit it to the chief appraiser before
December 15. The chief appraiser shall count the votes, declare the
five candidates who receive the largest cumulative vote totals
elected, and submit the results before December 31 to the governing
body of each taxing unit in the district and to the candidates. For
purposes of determining the number of votes received by the
candidates, the candidate receiving the most votes of the
conservation and reclamation districts is considered to have
received all of the votes cast by conservation and reclamation
districts and the other candidates are considered not to have
received any votes of the conservation and reclamation districts.
The chief appraiser shall resolve a tie vote by any method of
chance.
(k-1) This subsection applies only to an appraisal district
established in a county with a population of 120,000 or more. The
governing body of each taxing unit entitled to cast at least five
percent of the total votes must determine its vote by resolution
adopted at the first or second open meeting of the governing body
that is held after the date the chief appraiser delivers the ballot
to the presiding officer of the governing body. The governing body
must submit its vote to the chief appraiser not later than the third
day following the date the resolution is adopted.
SECTION 4. Section 6.052, Tax Code, is amended by amending
Subsections (a), (b), and (c) and adding Subsection (g) to read as
follows:
(a) The board of directors for an appraisal district created
for a county with a population of more than 120,000 shall appoint a
taxpayer liaison officer who shall serve at the pleasure of the
board. The taxpayer liaison officer shall administer the public
access functions required by Sections 6.04(d), (e), and (f), and is
responsible for resolving disputes not involving matters that may
be protested under Section 41.41. In addition, the taxpayer
liaison officer is responsible for receiving, and compiling a list
of, comments, complaints, and suggestions filed by the chief
appraiser, a property owner, or a property owner's agent concerning
the matters listed in Section 5.103(b) or any other matter related
to the fairness and efficiency of the appraisal review board
established for the appraisal district. The taxpayer liaison
officer shall forward to the comptroller comments, complaints, and
suggestions filed under this subsection in the form and manner
prescribed by the comptroller not later than December 31 of each
year.
(b) The taxpayer liaison officer shall provide to the public
information and materials designed to assist property owners in
understanding the appraisal process, protest procedures, the
procedure for filing comments, complaints, and suggestions under
Subsection (a) of this section or a complaint under Section
6.04(g), and other matters. Information concerning the process for
submitting comments, complaints, and suggestions to the
comptroller concerning an appraisal review board shall be provided
at each protest hearing.
(c) The taxpayer liaison officer shall report to the board
at each meeting on the status of all comments, complaints, and
suggestions filed with the officer under Subsection (a) of this
section and all complaints filed with the board under Section
6.04(g).
(g) Notwithstanding any other provision of this chapter, a
taxpayer liaison officer does not commit an offense under this
chapter if the officer communicates with the chief appraiser or
another employee or agent of the appraisal district, a member of the
appraisal review board established for the appraisal district, a
member of the board of directors of the appraisal district, a
property tax consultant, a property owner, an agent of a property
owner, or another person if the communication is made in the good
faith exercise of the officer's statutory duties.
SECTION 5. Subchapter A, Chapter 6, Tax Code, is amended by
adding Section 6.155 to read as follows:
Sec. 6.155. CERTAIN COMMUNICATIONS BY TAXING UNITS
PROHIBITED; PENALTY. (a) A member of the governing body, officer,
or employee of a taxing unit commits an offense if the person
directly or indirectly communicates with the chief appraiser or
another employee of the appraisal district in which the taxing unit
participates for the purpose of influencing the value at which
property in the district is appraised unless the person owns or
leases the property that is the subject of the communication.
(b) An offense under this section is a Class A misdemeanor.
SECTION 6. Section 11.252(d), Tax Code, is amended to read
as follows:
(d) In connection with the requirements and procedures
under Subsection (c), the comptroller by rule shall adopt a form to
be completed by the lessee of a motor vehicle for which the owner of
the vehicle may apply for an exemption under Subsection (a). The
form shall require a lessee who is an individual to provide the
lessee's name, address, and driver's license or personal
identification certificate number. The form shall require a
lessee that is an entity described by Subsection (b) to provide the
lessee's name, address, and, if applicable, federal tax
identification number. The form shall require a lessee who is an
individual, or the authorized representative of a lessee that is an
entity described by Subsection (b), to certify, either under oath
or by written, unsworn declaration, that the lessee does not hold
the vehicle for the production of income and that the vehicle is
used primarily for activities that do not involve the production of
income. The comptroller shall include on the form a notice of the
penalties prescribed by Section 37.10, Penal Code, for making a
false statement on the form.
SECTION 7. Section 11.253, Tax Code, is amended by adding
Subsections (l) and (m) to read as follows:
(l) This subsection applies only to a taxing unit any part
of which is located in an area designated a disaster area by a
disaster declaration issued under Section 418.014 or 418.108,
Government Code, on or after January 1, 2020. Notwithstanding
Subsections (a)(2)(C), (e), and (g), the governing body of a taxing
unit, in the manner provided by law for official action, may extend
the date by which goods-in-transit must be transported to another
location in this state or outside this state to a date not later
than the 270th day after the date the person acquired the property
in or imported the property into this state. An extension adopted by
official action under this subsection applies only to:
(1) the exemption from ad valorem taxation by the
taxing unit adopting the extension; and
(2) the tax year in which the extension is adopted.
(m) This subsection and Subsection (l) expire December 31,
2025.
SECTION 8. Sections 21.021(a) and (b), Tax Code, are
amended to read as follows:
(a) Except as otherwise provided by Section 21.031(b-2), a
[A] vessel or other watercraft used as an instrumentality of
commerce, [(]as defined by [in] Section 21.031, [21.031(b) of this
code)] is taxable pursuant to Section 21.02 [of this code].
(b) A special-purpose vessel or other watercraft not used as
an instrumentality of commerce, [(]as defined by [in] Section
21.031, [21.031(b) of this code)] is deemed to be located on January
1 for more than a temporary period for purposes of Section 21.02 [of
this code] in the taxing unit in which it was physically located
during the year preceding the tax year. If the vessel or watercraft
was physically located in more than one taxing unit during the year
preceding the tax year, it is deemed to be located for more than a
temporary period for purposes of Section 21.02 [of this code] in the
taxing unit in which it was physically located for the longest
period during the year preceding the tax year or for 30 days,
whichever is longer. If a vessel or other watercraft is not deemed
to be located in any taxing unit on January 1 for more than a
temporary period pursuant to this subsection, the property is
taxable as provided by Sections 21.02(a)(2) through (4)
[Subdivisions (2) through (4) of Section 21.02 of this code].
SECTION 9. Section 21.031, Tax Code, is amended by amending
Subsection (b) and adding Subsections (b-1), (b-2), (b-3), and (i)
to read as follows:
(b) The appraisal office shall make the allocation as
provided by Subsections (b-1), (b-2), and (b-3).
(b-1) Except as provided by Subsection (b-2), the [follows:
[(1) The] allocable portion of the total fair market
value of a vessel or other watercraft used as an instrumentality of
commerce that is taxable in this state is determined by multiplying
the total fair market value by a fraction, the numerator of which is
the number of miles the vessel or watercraft was operated in this
state during the year preceding the tax year and the denominator of
which is the total number of miles the vessel or watercraft was
operated during the year preceding the tax year. [For purposes of
this section, "vessel or other watercraft used as an
instrumentality of commerce" means a vessel or other watercraft
that is primarily employed in the transportation of cargo,
passengers, or equipment, and that is economically employed when it
is moving from point to point as a means of transportation.]
(b-2) A property owner that operates a fleet of vessels or
other watercraft that are used as instrumentalities of commerce may
elect in writing submitted to the appraisal office to have the
appraisal office make the allocation under this subsection. If the
property owner makes the election, the allocable portion of the
total fair market value of a vessel or other watercraft that is part
of the property owner's fleet, is used as an instrumentality of
commerce, is taxable in this state, and has taxable situs at a
location in the appraisal district is determined by multiplying the
total fair market value of the vessel or other watercraft by a
fraction, the numerator of which is the number of miles that all the
vessels or other watercraft of the property owner's fleet that are
used as instrumentalities of commerce, are taxable in this state,
and have taxable situs at a location in the same appraisal district
as the vessel or other watercraft the value of which is allocated
under this subsection were operated in this state during the year
preceding the tax year and the denominator of which is the total
number of miles that all the vessels or other watercraft of the
property owner's fleet that are used as instrumentalities of
commerce, are taxable in this state, and have taxable situs at a
location in the same appraisal district as the vessel or other
watercraft the value of which is allocated under this subsection
were operated during the year preceding the tax year.
Notwithstanding Sections 21.02 and 21.021, a property owner that
elects to have the appraisal office make the allocation of the
property owner's fleet under this subsection may designate the
location of the property owner's principal place of business as the
taxable situs of the fleet.
(b-3) [(2)] The allocable portion of the total fair market
value of a special-purpose vessel or other watercraft not used as an
instrumentality of commerce is determined by multiplying the total
fair market value by a fraction, the numerator of which is the
number of days the vessel or watercraft was physically located in
this state during the year preceding the tax year and the
denominator of which is 365. [For purposes of this section,
"special-purpose vessel or other watercraft not used as an
instrumentality of commerce" means a vessel or other watercraft
that:
[(A) is designed to be transient and customarily
is moved from location to location on a more or less regular basis;
[(B) is economically employed when operated in a
localized area or in a fixed place; and
[(C) is not primarily employed to transport cargo,
passengers, and equipment but rather to perform some specialized
function or operation not requiring constant movement from point to
point.]
(i) For purposes of this section:
(1) "Special-purpose vessel or other watercraft not
used as an instrumentality of commerce" means a vessel or other
watercraft that:
(A) is designed to be transient and customarily
is moved from location to location on a more or less regular basis;
(B) is economically employed when operated in a
localized area or in a fixed place; and
(C) is not primarily employed to transport cargo,
passengers, and equipment but rather to perform some specialized
function or operation not requiring constant movement from point to
point.
(2) "Vessel or other watercraft used as an
instrumentality of commerce" means a vessel or other watercraft
that is primarily employed in the transportation of cargo,
passengers, or equipment, and that is economically employed when it
is moving from point to point as a means of transportation.
SECTION 10. Section 25.02, Tax Code, is amended by adding
Subsections (c), (d), (e), (f), and (g) to read as follows:
(c) Each appraisal record must have a unique account number.
If an appraisal district changes the account number of an appraisal
record, the appraisal district must provide written notice of the
change to the property owner as soon as practicable after the change
and provide notice of the change in the next notice of appraised
value of the property included in the record that is delivered to
the property owner under Section 25.19.
(d) This subsection does not apply to an appraisal record
for a residential property, for an improvement only, or for a
property on which a delinquent tax is due. On the written request
of a property owner, the chief appraiser shall combine contiguous
parcels or tracts of the owner's real property into a single
appraisal record. On the written request of a property owner, the
chief appraiser shall separate identifiable segments of the owner's
parcel or tract of real property into individual appraisal records.
(e) A property owner must make a request under Subsection
(d) before January 1 of the tax year for which the requested change
to the appraisal records is to be made. The request must contain a
legal description as contained in a deed sufficient to describe the
property subject to the request.
(f) If a chief appraiser refuses to combine parcels or
tracts, or separate a parcel or tract, on request of a property
owner under Subsection (d), the appraisal review board may order
the requested change on a motion filed by the property owner under
Section 25.25 or a protest filed under Chapter 41.
(g) The combination of contiguous parcels or tracts of real
property into a single appraisal record or the separation of
identifiable segments of a parcel or tract of real property into
individual appraisal records under this section does not affect the
application of generally accepted appraisal methods and techniques
to the appraisal of real property associated with those appraisal
records, including real property that is part of the same economic
unit as real property contained in the same or another appraisal
record.
SECTION 11. Section 25.19(b), Tax Code, as effective
January 1, 2022, is amended to read as follows:
(b) The chief appraiser shall separate real from personal
property and include in the notice for each:
(1) a list of the taxing units in which the property is
taxable;
(2) the appraised value of the property in the
preceding year;
(3) the taxable value of the property in the preceding
year for each taxing unit taxing the property;
(4) the appraised value of the property for the
current year, the kind and amount of each exemption and partial
exemption, if any, approved for the property for the current year
and for the preceding year, and, if an exemption or partial
exemption that was approved for the preceding year was canceled or
reduced for the current year, the amount of the exemption or partial
exemption canceled or reduced;
(5) in italic typeface, the following statement: "The
Texas Legislature does not set the amount of your local taxes. Your
property tax burden is decided by your locally elected officials,
and all inquiries concerning your taxes should be directed to those
officials";
(6) a detailed explanation of the time and procedure
for protesting the value;
(7) the date and place the appraisal review board will
begin hearing protests; [and]
(8) an explanation of the availability and purpose of
an informal conference with the appraisal office before a hearing
on a protest; and
(9) a brief explanation that the governing body of
each taxing unit decides whether or not taxes on the property will
increase and the appraisal district only determines the value of
the property.
SECTION 12. Section 25.19, Tax Code, is amended by adding
Subsections (m) and (n) to read as follows:
(m) The chief appraiser may not deliver a corrected or
amended notice of appraised value later than June 1 for property for
which a person files a rendition statement or property report as
required by Chapter 22 unless the purpose of the notice is to:
(1) include omitted property; or
(2) correct a clerical error.
(n) As soon as practicable after delivering a notice
required by this section to a property owner, the chief appraiser
shall post the notice on the appraisal district's Internet website,
if the appraisal district maintains a website, as part of the
appraisal record pertaining to the property.
SECTION 13. Section 31.11(h), Tax Code, is amended to read
as follows:
(h) This section does not apply to an overpayment caused by
a change of exemption status or correction of a tax roll, including
an overpayment received after a correction of a tax roll as a result
of an appeal under Chapter 42. Such an overpayment is covered by
Section 26.15 or 42.43, as applicable.
SECTION 14. Section 41.01, Tax Code, is amended by adding
Subsections (c), (d), and (e) to read as follows:
(c) The appraisal review board by rule shall adopt
procedures for hearings the board conducts under this subchapter
and Subchapter C. Before adopting the hearing procedures, the
board shall hold a public hearing to consider the hearing
procedures proposed for adoption by the board. Not later than May
15 of each year, the board shall hold the hearing, make any
amendments to the proposed hearing procedures the board determines
are necessary, and by resolution finally adopt the hearing
procedures. The board must comply with Section 5.103(d) when
adopting the hearing procedures. The chairman of the board is
responsible for the administration of hearing procedures adopted by
the board.
(d) The appraisal review board shall distribute copies of
the hearing procedures adopted by the board to the board of
directors of, and the taxpayer liaison officer for, the appraisal
district for which the appraisal review board is established and to
the comptroller not later than the 15th day after the date the board
adopts the hearing procedures.
(e) The appraisal review board shall post a copy of the
hearing procedures adopted by the board:
(1) in a prominent place in each room in which the
board conducts hearings under this subchapter and Subchapter C; and
(2) if the appraisal district for which the board is
established maintains an Internet website, on the appraisal
district's website.
SECTION 15. Section 41.44(d), Tax Code, is amended to read
as follows:
(d) A notice of protest is sufficient if it identifies the
protesting property owner, including a person claiming an ownership
interest in the property even if that person is not listed on the
appraisal records as an owner of the property, identifies the
property that is the subject of the protest, and indicates apparent
dissatisfaction with some determination of the appraisal
office. The notice need not be on an official form, but the
comptroller shall prescribe a form that provides for more detail
about the nature of the protest. The form must permit a property
owner to include each property in the appraisal district that is the
subject of a protest. The form must permit a property owner to
request that the protest be heard by a special panel established
under Section 6.425 if the protest will be determined by an
appraisal review board to which that section applies and the
property is included in a classification described by Section
6.425(b). The form must permit a property owner to request that the
protest be heard by a single-member panel authorized by Section
41.45(b-4). The comptroller, each appraisal office, and each
appraisal review board shall make the forms readily available and
deliver one to a property owner on request.
SECTION 16. Subchapter C, Chapter 41, Tax Code, is amended
by adding Section 41.445 to read as follows:
Sec. 41.445. INFORMAL CONFERENCE BEFORE HEARING ON PROTEST.
The appraisal office shall hold an informal conference with each
property owner who files a notice of protest with the appraisal
review board and requests an informal conference. An informal
conference must be held before the hearing on the protest.
SECTION 17. Section 41.45, Tax Code, is amended by amending
Subsections (b-1), (d), (d-2), and (d-3) and adding Subsections
(b-4) and (b-5) to read as follows:
(b-1) An appraisal review board shall conduct a hearing on a
protest by telephone conference call if[:
[(1)] the property owner notifies the board that the
property owner intends to appear by telephone conference call in
the owner's notice of protest or by written notice filed with the
board not later than the 10th day before the date of the hearing [;
or
[(2) the board proposes that the hearing be conducted
by telephone conference call and the property owner agrees to the
hearing being conducted in that manner].
(b-4) An appraisal review board shall sit in a single-member
panel to conduct a protest hearing under this section if the
property owner requests that the hearing be conducted by a
single-member panel:
(1) in the notice of protest; or
(2) in writing submitted to the board not later than
the 10th day before the date of the hearing.
(b-5) If the recommendation of a single-member panel that
conducts a hearing under Subsection (b-4) is not accepted by the
appraisal review board, the board may refer the matter for
rehearing to a single-member panel composed of a member who did not
hear the original protest or the board may determine the protest.
(d) This subsection does not apply to a single-member panel
established under Subsection (b-4) of this section or a special
panel established under Section 6.425. An appraisal review board
consisting of more than three members may sit in panels of not fewer
than three members to conduct protest hearings. If the
recommendation of a panel is not accepted by the board, the board
may refer the matter for rehearing to a panel composed of members
who did not hear the original protest or, if there are not at least
three members who did not hear the original protest, the board may
determine the protest.
(d-2) The determination of a protest heard by a panel under
Subsection (b-4), (d), or (d-1) must be made by the board.
(d-3) The board must deliver notice of a hearing or meeting
to determine a protest heard by a panel, or to rehear a protest,
under Subsection (b-4), (d), or (d-1) in accordance with the
provisions of this subchapter.
SECTION 18. Section 41.461(a), Tax Code, is amended to read
as follows:
(a) At least 14 days before a hearing on a protest, the chief
appraiser shall:
(1) deliver a copy of the pamphlet prepared by the
comptroller under Section 5.06 to the property owner initiating the
protest, or to an agent representing the owner if requested by the
agent;
(2) inform the property owner that the owner or the
agent of the owner is entitled on request to a copy of the data,
schedules, formulas, and all other information the chief appraiser
will introduce at the hearing to establish any matter at issue; and
(3) deliver a copy of the hearing procedures adopted
[established] by the appraisal review board under Section 41.01
[41.66] to the property owner.
SECTION 19. Section 41.47, Tax Code, is amended by amending
Subsection (c) and adding Subsection (d-1) to read as follows:
(c) If the protest is of the determination of the appraised
value of the owner's property, the appraisal review board must
state in the order the appraised value of the property, listed
separately in the case of real property as the appraised value of
the land and the appraised value of any improvement to the land as
allocated by the chief appraiser:
(1) as shown in the appraisal records submitted to the
board by the chief appraiser under Section 25.22 or 25.23; and
(2) as finally determined by the board.
(d-1) This subsection applies only to an appraisal district
established in a county with a population of 120,000 or more. The
requirements of this subsection are in addition to the requirements
of Subsection (d). On written request submitted to the chief
appraiser, the chief appraiser shall deliver by e-mail, in the
manner provided by this subsection, a copy of the notice of issuance
of the order and a copy of the order required by Subsection (d) if
the property subject to the order is not the subject of an agreement
under Section 1.085. A request under this subsection may be
submitted only by the property owner whose property is subject to
the protest for which the order is issued, an attorney representing
the property owner, or an individual designated by the property
owner under Section 1.111. A person may include in a single request
more than one property owned by the same property owner or multiple
properties owned by multiple property owners. A person may submit
more than one request. A person submitting a request must indicate
in the request that the chief appraiser must make the delivery to
the property owner, an attorney representing the property owner, an
individual designated by the property owner under Section 1.111, or
a combination of those persons. A person must submit a request
before the protest hearing relating to each property included in
the request. The chief appraiser shall deliver, as provided by this
subsection, a copy of the notice of issuance of the order and a copy
of the order required by Subsection (d) not later than the 21st day
after the date the appraisal review board issues the order.
SECTION 20. Section 41.66, Tax Code, is amended by amending
Subsection (a) and adding Subsection (q) to read as follows:
(a) The appraisal review board shall conduct hearings in
accordance with the hearing procedures adopted by the appraisal
review board under Section 41.01(c) [establish by rule the
procedures for hearings it conducts as provided by Subchapters A
and C of this chapter]. On request made by a property owner in the
owner's notice of protest or in a separate writing delivered to the
appraisal review board on or before the date the notice of protest
is filed, the property owner is entitled to a copy of the hearing
procedures. The copy of the hearing procedures shall be delivered
to the property owner not later than the 10th day before the date
the hearing on the protest begins and may be delivered with the
notice of the protest hearing required under Section 41.46(a). The
notice of protest form prescribed by the comptroller under Section
41.44(d) or any other notice of protest form made available to a
property owner by the appraisal review board or the appraisal
office shall provide the property owner an opportunity to make or
decline to make a request under this subsection. [The appraisal
review board shall post a copy of the hearing procedures in a
prominent place in the room in which the hearing is held.]
(q) A person who owns property in an appraisal district or
the chief appraiser of an appraisal district may file a complaint
with the taxpayer liaison officer for the appraisal district
alleging that the appraisal review board established for the
appraisal district has adopted or is implementing hearing
procedures that are not in compliance with the model hearing
procedures prepared by the comptroller under Section 5.103 or is
not complying with procedural requirements under this chapter. The
taxpayer liaison officer shall investigate the complaint and report
the findings of the investigation to the board of directors of the
appraisal district. The board of directors shall direct the
chairman of the appraisal review board to take remedial action if,
after reviewing the taxpayer liaison officer's report, the board of
directors determines that the allegations contained in the
complaint are true. The board of directors may remove the member of
the appraisal review board serving as chairman of the appraisal
review board from that member's position as chairman if the board
determines that the chairman has failed to take the actions
necessary to bring the appraisal review board into compliance with
Section 5.103(d) or this chapter, as applicable.
SECTION 21. Chapter 41A, Tax Code, is amended by adding
Section 41A.015 to read as follows:
Sec. 41A.015. LIMITED BINDING ARBITRATION TO COMPEL
COMPLIANCE WITH CERTAIN PROCEDURAL REQUIREMENTS RELATED TO
PROTESTS. (a) A property owner who has filed a notice of protest
under Chapter 41 may file a request for limited binding arbitration
under this section to compel the appraisal review board or chief
appraiser, as appropriate, to:
(1) rescind procedural rules adopted by the appraisal
review board that are not in compliance with the model hearing
procedures prepared by the comptroller under Section 5.103;
(2) schedule a hearing on a protest as required by
Section 41.45;
(3) deliver information to the property owner in the
manner required by Section 41.461;
(4) allow the property owner to offer evidence,
examine or cross-examine witnesses or other parties, and present
arguments as required by Section 41.66(b);
(5) set a hearing for a time and date certain and
postpone a hearing that does not begin within two hours of the
scheduled time as required by Section 41.66(i);
(6) schedule hearings on protests concerning multiple
properties identified in the same notice of protest on the same day
at the request of the property owner or the property owner's
designated agent as required by Section 41.66(j); or
(7) refrain from using or offering as evidence
information requested by the property owner under Section 41.461
that was not delivered to the property owner at least 14 days before
the hearing as required by Section 41.67(d).
(b) A property owner may not file a request for limited
binding arbitration under this section unless:
(1) the property owner has delivered written notice to
the chairman of the appraisal review board, the chief appraiser,
and the taxpayer liaison officer for the applicable appraisal
district by certified mail, return receipt requested, of the
procedural requirement with which the property owner alleges the
appraisal review board or chief appraiser failed to comply on or
before the fifth business day after the date the appraisal review
board or chief appraiser was required to comply with the
requirement; and
(2) the chairman of the appraisal review board or
chief appraiser, as applicable, fails to deliver to the property
owner on or before the 10th day after the date the notice is
delivered a written statement confirming that the appraisal review
board or chief appraiser, as applicable, will comply with the
requirement or cure a failure to comply with the requirement.
(c) Except as otherwise provided by this subtitle, the
failure to comply with a procedural requirement listed under
Subsection (a) is not a ground for postponement of a hearing on a
protest. An appraisal review board may cure an alleged failure to
comply with a procedural requirement that occurred during a hearing
by rescinding the order determining the protest for which the
hearing was held and scheduling a new hearing on the protest.
(d) A property owner must request limited binding
arbitration under this section by filing a request with the
comptroller. The property owner may not file the request earlier
than the 11th day or later than the 30th day after the date the
property owner delivers the notice required by Subsection (b)(1) to
the chairman of the appraisal review board, the chief appraiser,
and the taxpayer liaison officer for the applicable appraisal
district.
(e) A request for limited binding arbitration under this
section must be in a form prescribed by the comptroller and be
accompanied by an arbitration deposit payable to the comptroller in
the amount of:
(1) $450, if the property that is the subject of the
protest to which the arbitration relates qualifies as the property
owner's residence homestead under Section 11.13 and the appraised
or market value, as applicable, of the property is $500,000 or less,
as determined by the appraisal district for the most recent tax
year; or
(2) $550, for property other than property described
by Subdivision (1).
(f) The comptroller shall prescribe the form to be used for
submitting a request for limited binding arbitration under this
section. The form must require the property owner to provide:
(1) a statement that the property owner has provided
the written notice required by Subsection (b);
(2) a statement that the property owner has made the
arbitration deposit required by this section;
(3) a brief statement identifying the procedural
requirement with which the property owner alleges the appraisal
review board or chief appraiser, as applicable, has failed to
comply;
(4) a description of the action taken or not taken by
the appraisal review board or chief appraiser regarding the
procedural requirement identified under Subdivision (3);
(5) a description of the property to which the award
will apply; and
(6) any other information reasonably necessary for the
comptroller to appoint an arbitrator.
(g) On receipt of the request and deposit under this
section, the comptroller shall appoint an arbitrator from the
registry maintained under Section 41A.06 who is eligible to serve
as an arbitrator under Subsection (p) of this section. Section
41A.07(h) does not apply to the appointment of an arbitrator under
this section.
(h) The appraisal review board, the chief appraiser, and the
property owner are parties to a limited binding arbitration
conducted under this section. The appraisal review board may
appear by counsel, by the chairman, or by a person designated by the
chairman. The chief appraiser may appear by counsel, in person, or
by a designated employee. The property owner may appear in the
manner provided by Section 41A.08(b)(2), (3), (4), or (5).
(i) The arbitrator shall make an arbitration award and
deliver an electronic copy of the award to:
(1) the property owner;
(2) the chairman of the appraisal review board;
(3) the chief appraiser; and
(4) the comptroller.
(j) An award under this section:
(1) shall include a determination of whether the
appraisal review board or chief appraiser failed to comply with a
procedural requirement as alleged in the request for limited
binding arbitration;
(2) if the arbitrator determines that the appraisal
review board or chief appraiser failed to comply with a procedural
requirement as alleged in the request, shall direct the appraisal
review board or chief appraiser, as applicable, to:
(A) comply with the procedural requirement; or
(B) if the hearing on the protest has been held
and the appraisal review board has issued an order determining the
protest, rescind the order and hold a new hearing on the protest
that complies with the procedural requirement;
(3) shall specify the arbitrator's fee;
(4) is final and may not be appealed; and
(5) is enforceable as provided by Section 41A.09.
(k) If the arbitrator determines that the appraisal review
board or chief appraiser failed to comply with the procedural
requirement that was the subject of the limited binding
arbitration:
(1) the comptroller, on receipt of a copy of the award,
shall refund the property owner's arbitration deposit, less the
amount retained by the comptroller under Section 41A.05(b); and
(2) the appraisal district shall pay the arbitrator's
fee.
(l) If the arbitrator determines that the appraisal review
board or chief appraiser complied with the procedural requirement
that was the subject of the limited binding arbitration, the
comptroller shall:
(1) pay the arbitrator's fee out of the owner's
arbitration deposit; and
(2) refund to the owner the owner's arbitration
deposit, less the arbitrator's fee and the amount retained by the
comptroller under Section 41A.05(b).
(m) As soon as practicable after receiving notice of an
award, the appraisal review board or the chief appraiser shall:
(1) take any action required to comply with the
requirements of the award; and
(2) if the award requires the appraisal review board
to conduct a new hearing under Chapter 41, schedule and conduct the
hearing.
(n) An award under this section does not affect the property
owner's right to:
(1) appeal the final determination of a protest by the
appraisal review board under Chapter 42; or
(2) pursue any other legal or statutory remedy
available to the property owner.
(o) A property owner may request a single limited binding
arbitration under this section that covers more than one property,
more than one protest hearing, or an allegation of the failure by
the appraisal review board or chief appraiser to comply with more
than one procedural requirement so long as the requirements of
Subsection (b) are met with regard to each alleged failure to
comply. The amount of the arbitration deposit and the amount of the
arbitrator's fee are computed as if a single property were the
subject of the arbitration. If the arbitration involves property
described by Subsection (e)(1) and property described by Subsection
(e)(2), the amount of the arbitration deposit and the amount of the
arbitrator's fee are computed as if only the property described by
Subsection (e)(2) were the subject of the arbitration. If the
arbitration involves an allegation of the failure by the appraisal
review board or chief appraiser to comply with more than one
procedural requirement, Subsection (k) applies if the arbitrator
determines that the appraisal review board or chief appraiser
failed to comply with one or more of the procedural requirements
that were the subject of the arbitration and Subsection (l) applies
if the arbitrator determines that the appraisal review board or
chief appraiser complied with all of the procedural requirements
that were the subject of the arbitration.
(p) Section 41A.06 applies to the registration and
qualification of an arbitrator under this section except that an
arbitrator under this section must:
(1) be a licensed attorney; and
(2) agree to conduct an arbitration for a fee that is
not more than:
(A) $400 if the property is described by
Subsection (e)(1); or
(B) $500 if the property is described by
Subsection (e)(2).
(q) Except as otherwise provided by this section, the
provisions of this chapter apply to a limited binding arbitration
under this section. In the event of a conflict between this section
and another provision of this chapter, this section controls.
SECTION 22. Section 41A.10, Tax Code, is amended by
amending Subsection (a) and adding Subsection (c) to read as
follows:
(a) The pendency of an appeal under this chapter does not
affect the delinquency date for the taxes on the property subject to
the appeal. Except for a property owner who has elected to defer
the collection of taxes under Section 33.06 or 33.065 on the
property subject to the appeal and for which the deferral is still
in effect, a [A] property owner who appeals an appraisal review
board order under this chapter shall pay taxes on the property
subject to the appeal in an amount equal to the amount of taxes due
on the portion of the taxable value of the property that is not in
dispute. If the final determination of an appeal under this chapter
decreases the property owner's tax liability to less than the
amount of taxes paid, the taxing unit shall refund to the property
owner the difference between the amount of taxes paid and the amount
of taxes for which the property owner is liable.
(c) For the purposes of Subsection (b) of this section,
taxes are not considered delinquent on property subject to an
appeal if the property owner has elected to defer the collection of
taxes on the property under Section 33.06 or 33.065 and the deferral
is still in effect.
SECTION 23. Section 42.015(a), Tax Code, is amended to read
as follows:
(a) A person leasing property who is contractually
obligated to reimburse the property owner for taxes imposed on the
property is entitled to appeal an order of the appraisal review
board determining a protest relating to the property:
(1) brought by the person under Section 41.413; or
(2) brought by the property owner if the property
owner does not appeal the order.
SECTION 24. Section 42.23(e), Tax Code, is amended to read
as follows:
(e) For purposes of Subsection (d), a property owner may
designate a cause of action under Section 42.25 or 42.26 as the
basis for an appeal, but may not designate a cause of action under
both sections as the basis for the appeal. Discovery regarding a
cause of action that is not specifically designated by the property
owner under Subsection (d) shall be conducted as provided by the
Texas Rules of Civil Procedure. A [The] court may not enter an
order, including a protective order [to modify the provisions of
this subsection] under Rule 192.6 of the Texas Rules of Civil
Procedure, that conflicts with Subsection (d).
SECTION 25. Section 6.03, Tax Code, as amended by this Act,
applies only to the selection of members of the board of directors
of an appraisal district who are appointed for a term that begins on
or after January 1, 2022.
SECTION 26. Section 11.253, Tax Code, as amended by this
Act, applies only to a tax year beginning on or after January 1,
2022.
SECTION 27. Sections 21.021 and 21.031, Tax Code, as
amended by this Act, apply only to the allocation of the value and
the determination of the situs of vessels and other watercraft for
ad valorem tax purposes beginning on or after January 1, 2022.
SECTION 28. Section 25.19, Tax Code, as amended by this Act,
applies only to a notice of appraised value for a tax year beginning
on or after January 1, 2022.
SECTION 29. Section 41.445, Tax Code, as added by this Act,
and Sections 41.45 and 41.47, Tax Code, as amended by this Act,
apply only to a protest under Chapter 41, Tax Code, for which a
notice of protest is filed by a property owner on or after January
1, 2022. A protest under Chapter 41, Tax Code, for which a notice of
protest is filed by a property owner before January 1, 2022, is
governed by the law in effect on the date the notice of protest is
filed, and the former law is continued in effect for that purpose.
SECTION 30. Section 41A.10, Tax Code, as amended by this
Act, applies only to a request for binding arbitration under
Chapter 41A, Tax Code, that is filed on or after the effective date
of this Act. A request for binding arbitration under Chapter 41A,
Tax Code, that is filed before the effective date of this Act is
governed by the law in effect on the date the request is filed, and
the former law is continued in effect for that purpose.
SECTION 31. Sections 42.015 and 42.23, Tax Code, as amended
by this Act, apply to an appeal under Chapter 42, Tax Code, that is
pending on the date the amendments to those sections take effect
under this Act or that is filed on or after that date.
SECTION 32. The comptroller of public accounts is required
to implement a provision of this Act only if the legislature
appropriates money specifically for that purpose. If the
legislature does not appropriate money specifically for that
purpose, the comptroller may, but is not required to, implement a
provision of this Act using other appropriations available for that
purpose.
SECTION 33. (a) Except as provided by Subsection (b) of this
section, this Act takes effect January 1, 2022.
(b) Sections 5.103, 5.104, 6.052, 41.01, 41.461, 41.66,
42.015, and 42.23, Tax Code, as amended by this Act, and Section
41A.015, Tax Code, as added by this Act, take effect immediately if
this Act receives a vote of two-thirds of all the members elected to
each house, as provided by Section 39, Article III, Texas
Constitution. If this Act does not receive the vote necessary for
immediate effect, those sections of this Act take effect September
1, 2021.
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