LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION April 2, 2015 TO: Honorable Jane Nelson, Chair, Senate Committee on Finance FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB50 by Zaffirini (Relating to ad valorem tax liens on personal property.), As Introduced Passage of the bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches. Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. As a result, costs to the Foundation School Fund could be decreased through the operation of the school finance formulas. The bill would amend Tax Code Section 32.01, regarding property tax liens. Current law provides that a tax lien attaches to property in favor of each taxing unit having power to tax the property and provides that a tax lien on personal property attaches to all personal property that the property owner owns on January 1 of the tax year in which the lien attaches or that the property owner subsequently acquires. The bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches.Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. A fiscal gain to local taxing units and to the state through the operation of the school finance formulas could result. No information is available regarding the amount of delinquent property tax recovery that would be provided under the bill. As such, any fiscal implications cannot be estimated. This bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015. Local Government Impact Passage of the bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches. Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. As a result, ad valorem tax revenue for units of local government could be increased. Source Agencies:304 Comptroller of Public Accounts LBB Staff: UP, KK, SD, SJS
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION
April 2, 2015
TO: Honorable Jane Nelson, Chair, Senate Committee on Finance FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB50 by Zaffirini (Relating to ad valorem tax liens on personal property.), As Introduced
TO: Honorable Jane Nelson, Chair, Senate Committee on Finance
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: SB50 by Zaffirini (Relating to ad valorem tax liens on personal property.), As Introduced
Honorable Jane Nelson, Chair, Senate Committee on Finance
Honorable Jane Nelson, Chair, Senate Committee on Finance
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
SB50 by Zaffirini (Relating to ad valorem tax liens on personal property.), As Introduced
SB50 by Zaffirini (Relating to ad valorem tax liens on personal property.), As Introduced
Passage of the bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches. Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. As a result, costs to the Foundation School Fund could be decreased through the operation of the school finance formulas.
Passage of the bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches. Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. As a result, costs to the Foundation School Fund could be decreased through the operation of the school finance formulas.
The bill would amend Tax Code Section 32.01, regarding property tax liens. Current law provides that a tax lien attaches to property in favor of each taxing unit having power to tax the property and provides that a tax lien on personal property attaches to all personal property that the property owner owns on January 1 of the tax year in which the lien attaches or that the property owner subsequently acquires. The bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches.Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. A fiscal gain to local taxing units and to the state through the operation of the school finance formulas could result. No information is available regarding the amount of delinquent property tax recovery that would be provided under the bill. As such, any fiscal implications cannot be estimated. This bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015.
Local Government Impact
Passage of the bill would add a provision that a lien on personal property would attach irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches. Attachment of a personal property tax lien irrespective of whether the personal property is located within the boundaries of the taxing unit in whose favor the lien attaches could enable taxing units to recover more delinquent property taxes through the sale of foreclosed personal property outside the taxing unit's boundaries. As a result, ad valorem tax revenue for units of local government could be increased.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: UP, KK, SD, SJS
UP, KK, SD, SJS