Relating to the exemption from ad valorem taxation for certain property used to control pollution.
Impact
The bill modifies Section 11.31 of the Tax Code, expanding the definition of eligible properties for tax exemptions. Importantly, it allows for exemptions to be granted not only for physical pollution control facilities but also for products and services that help manage waste and reduce pollution, as long as these are installed under an agreement with government entities. This change in tax policy is intended to encourage greater investment in pollution control technologies, thereby fostering environmental protection efforts across the state.
Summary
House Bill 3965 proposes an exemption from ad valorem taxation for specific properties used to control pollution. The bill outlines criteria under which property owners can be eligible for this exemption, focusing on those who install and utilize pollution control facilities under contracts with governmental entities. The aim is to incentivize property owners to adopt environmentally friendly practices and technologies, reducing the financial burden associated with property taxes on pollution control assets.
Contention
One notable point of contention regarding HB3965 concerns the balance between encouraging business development and ensuring adequate tax revenue for local governments. Proponents argue that the incentives provided in this legislation will lead to enhanced environmental quality and innovation in pollution control, benefiting both the public and the economy. Critics, however, may be concerned that these exemptions could reduce funding for essential services, as local governments rely on property taxes for their budgets. The debate reflects broader discussions about the effectiveness of tax incentives in achieving environmental goals.
Proposing a constitutional amendment to authorize the legislature to exempt from ad valorem taxation property used to control pollution, regardless of whether the property is used to meet or exceed rules or regulations adopted for that purpose.
Relating to the exemption from ad valorem taxation of certain assets used for agricultural production and to the authority of a county commissioners court to adopt an exemption from ad valorem taxation by each taxing unit that taxes the property of the portion of the appraised value of a person's property that is attributable to the installation in or on the property of certain water conservation systems.