Texas House Bill HB2409

Texas 2011 - 82nd Regular

• Introduced: 3/7/11
• Refer: 3/10/11

Caption

Relating to the priority of ad valorem tax liens and certain security interests.

Impact

The passage of HB2409 is expected to have significant implications for real property transactions in Texas. It will enhance the security of ad valorem tax liens and align them more favorably against other claims on the property. By clarifying the priority of these liens, the bill aims to encourage timely tax payments and protect local governments' revenue streams. This change may bolster tax collection efforts and provide a more straightforward framework for resolving disputes related to property liens.

Summary

House Bill 2409 addresses the priority of ad valorem tax liens in relation to certain security interests. This legislation amends specific sections of the Texas Tax Code to clarify the hierarchy of claims when a tax lien is placed on property. The bill establishes that a tax lien takes precedence over claims from other creditors and certain types of liens, including those held by homeowners' associations. However, it also stipulates exceptions to this priority, including claims for funeral expenses, easements, and purchase-money security interests that are perfected before the lien arises.

Sentiment

The general sentiment around HB2409 appears to be supportive, particularly among local jurisdictions and tax authorities who see the need for clearer tax collection laws. However, there may be concerns from property developers and creditors who could face more stringent conditions on their claims. The legislative discourse reflects a recognition of the importance of protecting public revenues while balancing the interests of property owners.

Contention

Notable points of contention surrounding the bill may arise from its potential to impact existing security interests and the rights of creditors. Critics might argue that the bill favors state revenue at the expense of private property rights, particularly for those holding liens that could be superseded by tax liens. This raises questions about the fairness of applying such amendments retroactively, particularly for interests that were established prior to the enactment of the bill.