By: Estes, Hinojosa S.B. No. 252
A BILL TO BE ENTITLED
AN ACT
relating to the authority of a municipality with a population of
less than 10,000 to enter into an agreement with an owner of real
property in or adjacent to an area in the municipality that has been
approved for funding under certain revitalization or redevelopment
programs to prohibit ad valorem tax increases on the owner's
property for a limited period.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 11, Tax Code, is amended by
adding Section 11.34 to read as follows:
Sec. 11.34. LIMITATION OF TAXES ON REAL PROPERTY IN
DESIGNATED AREAS OF CERTAIN MUNICIPALITIES. (a) This section
applies only to a municipality having a population of less than
10,000.
(b) Acting under the authority of Section 1-o, Article VIII,
Texas Constitution, the governing body of a municipality, by
official action, may call an election in the municipality to permit
the voters of the municipality to determine whether to authorize
the governing body to enter into an agreement with an owner of real
property in or adjacent to an area in the municipality that has been
approved for funding under the programs administered by the
Department of Agriculture as described by Section 1-o, Article
VIII, Texas Constitution, under which the parties agree that the ad
valorem taxes imposed by any political subdivision on the owner's
real property may not be increased for the first five tax years
after the tax year in which the agreement is entered into, subject
to the terms and conditions provided by the agreement.
(c) If the authority to limit tax increases under this
section is approved by the voters and the governing body of the
municipality enters into an agreement to limit tax increases under
this section, the tax officials shall appraise the property to
which the limitation applies and calculate taxes as on other
property, but if the tax so calculated exceeds the limitation, the
tax imposed is the amount of the tax as limited by this section,
except as provided by Subsections (f) and (g).
(d) An agreement to limit tax increases under this section
must be entered into before December 31 of the tax year in which the
election was held.
(e) A taxing unit may not increase the total annual amount
of ad valorem taxes the taxing unit imposes on the property above
the amount of the taxes the taxing unit imposed on the property in
the tax year in which the governing body of the municipality entered
into an agreement to limit tax increases under this section.
(f) Subject to Subsection (g), an agreement to limit tax
increases under this section expires on the earlier of:
(1) January 1 of the sixth tax year following the tax
year in which the agreement was entered into; or
(2) January 1 of the first tax year in which the owner
of the property when the agreement was entered into ceases to own
the property.
(g) If property subject to an agreement to limit tax
increases under this section is owned by two or more persons, the
limitation expires on January 1 of the first tax year following the
year in which the ownership of at least a 50 percent interest in the
property is sold or otherwise transferred.
(h) Notwithstanding Subsection (a), if the population of a
municipality to which this section applies when the municipality
enters into an agreement to limit taxes under this section
subsequently increases to 10,000 or more, the validity of the
agreement is not affected by that change in population, and the
agreement does not expire because of that change.
SECTION 2. This Act applies only to ad valorem taxes imposed
for a tax year beginning on or after the effective date of this Act.
SECTION 3. This Act takes effect immediately if it 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, this
Act takes effect September 1, 2009.