Texas House Bill HB649

Texas 2021 - 87th Regular

Caption

Relating to an exemption from ad valorem taxation of real property owned by a charitable organization for the purpose of renting the property at below-market rates to low-income and moderate-income households.

Impact

The proposed changes are expected to have a significant impact on local taxation policies. By exempting properties used for low-income and moderate-income housing from ad valorem taxes, the bill may enhance the ability of charitable organizations to maintain or increase their housing stock. This could potentially lead to a wider availability of affordable rental options in Texas. However, changes in tax revenue for local governments may necessitate adjustments in budget allocations or services.

Summary

House Bill 649 seeks to amend the Tax Code to provide an exemption from ad valorem taxation for real properties owned by charitable organizations. These properties must be utilized specifically for renting to low-income and moderate-income households at below-market rates. By offering this exemption, the bill aims to encourage charitable organizations to invest in and provide affordable housing options that could help alleviate housing costs for marginalized communities.

Contention

One of the notable points of contention surrounding HB 649 is the balance between providing tax relief for charitable entities and ensuring appropriate taxation levels for local services. Critics argue that extending tax exemptions could strain local government budgets that rely on property taxes for funding essential services. Furthermore, opponents may raise concerns over the potential for misuse of the exemption, highlighting the need for clear oversight mechanisms to ensure that the properties genuinely serve low-income and moderate-income populations.