Texas 2017 - 85th Regular

Texas House Bill HB1147 Compare Versions

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1	1	85R2162 SMH-D
2	2	By: Davis of Harris H.B. No. 1147
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the calculation of the ad valorem rollback tax rate of a
8	8	taxing unit.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 26.012, Tax Code, is amended by adding
11	11	Subdivisions (2-a) and (10-a) to read as follows:
12	12	(2-a) "Consumer price index" means the average over a
13	13	calendar year of the index that the comptroller considers to most
14	14	accurately report changes in the purchasing power of the dollar for
15	15	consumers in this state.
16	16	(10-a) "Inflation rate" means the amount, expressed in
17	17	decimal form rounded to the nearest thousandth, computed by
18	18	determining the percentage change in the consumer price index for
19	19	the preceding calendar year as compared to the consumer price index
20	20	for the calendar year preceding that calendar year.
21	21	SECTION 2. Section 26.04, Tax Code, is amended by adding
22	22	Subsection (b-1) and amending Subsection (c) to read as follows:
23	23	(b-1) By August 1 or as soon thereafter as practicable, the
24	24	comptroller shall determine the inflation rate for the current year
25	25	and publish the rate in the Texas Register.
26	26	(c) An officer or employee designated by the governing body
27	27	shall calculate the effective tax rate and the rollback tax rate for
28	28	the unit, where:
29	29	(1) "Effective tax rate" means a rate expressed in
30	30	dollars per $100 of taxable value calculated according to the
31	31	following formula:
32	32	EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY
33	33	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
34	34	; and
35	35	(2) "Rollback tax rate" means a rate expressed in
36	36	dollars per $100 of taxable value calculated according to the
37	37	following formula:
38	38	ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
39	39	OPERATIONS RATE x (1 + INFLATION RATE) [1.08]) +
40	40	CURRENT DEBT RATE
41	41	SECTION 3. Sections 26.041(a), (b), and (c), Tax Code, are
42	42	amended to read as follows:
43	43	(a) In the first year in which an additional sales and use
44	44	tax is required to be collected, the effective tax rate and rollback
45	45	tax rate for the unit are calculated according to the following
46	46	formulas:
47	47	EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
48	48	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] -
49	49	SALES TAX GAIN RATE
50	50	and
51	51	ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
52	52	OPERATIONS RATE x (1 + INFLATION RATE) [1.08]) +
53	53	CURRENT DEBT RATE - SALES TAX GAIN RATE
54	54	where "sales tax gain rate" means a number expressed in dollars per
55	55	$100 of taxable value, calculated by dividing the revenue that will
56	56	be generated by the additional sales and use tax in the following
57	57	year as calculated under Subsection (d) [of this section] by the
58	58	current total value.
59	59	(b) Except as provided by Subsections (a) and (c) [of this
60	60	section], in a year in which a taxing unit imposes an additional
61	61	sales and use tax the rollback tax rate for the unit is calculated
62	62	according to the following formula, regardless of whether the unit
63	63	levied a property tax in the preceding year:
64	64	ROLLBACK TAX RATE = [(LAST YEAR'S MAINTENANCE AND
65	65	OPERATIONS EXPENSE x (1 + INFLATION RATE) [1.08]) /
66	66	([TOTAL] CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
67	67	(CURRENT DEBT RATE - SALES TAX REVENUE RATE)
68	68	where "last year's maintenance and operations expense" means the
69	69	amount spent for maintenance and operations from property tax and
70	70	additional sales and use tax revenues in the preceding year, and
71	71	"sales tax revenue rate" means a number expressed in dollars per
72	72	$100 of taxable value, calculated by dividing the revenue that will
73	73	be generated by the additional sales and use tax in the current year
74	74	as calculated under Subsection (d) [of this section] by the current
75	75	total value.
76	76	(c) In a year in which a taxing unit that has been imposing
77	77	an additional sales and use tax ceases to impose an additional sales
78	78	and use tax the effective tax rate and rollback tax rate for the
79	79	unit are calculated according to the following formulas:
80	80	EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
81	81	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
82	82	SALES TAX LOSS RATE
83	83	and
84	84	ROLLBACK TAX RATE = [(LAST YEAR'S MAINTENANCE AND
85	85	OPERATIONS EXPENSE x (1 + INFLATION RATE) [1.08]) /
86	86	([TOTAL] CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
87	87	CURRENT DEBT RATE
88	88	where "sales tax loss rate" means a number expressed in dollars per
89	89	$100 of taxable value, calculated by dividing the amount of sales
90	90	and use tax revenue generated in the last four quarters for which
91	91	the information is available by the current total value and "last
92	92	year's maintenance and operations expense" means the amount spent
93	93	for maintenance and operations from property tax and additional
94	94	sales and use tax revenues in the preceding year.
95	95	SECTION 4. Section 8876.152(b), Special District Local Laws
96	96	Code, is amended to read as follows:
97	97	(b) Sections 49.236(a)(1) and (2) and (b) [Section 49.236],
98	98	Water Code, apply [as added by Chapter 248 (H.B. 1541), Acts of the
99	99	78th Legislature, Regular Session, 2003, applies] to the district.
100	100	SECTION 5. Section 49.236, Water Code, as added by Chapter
101	101	335 (S.B. 392), Acts of the 78th Legislature, Regular Session,
102	102	2003, is amended by amending Subsections (a) and (d) and adding
103	103	Subsection (e) to read as follows:
104	104	(a) Before the board adopts an ad valorem tax rate for the
105	105	district for debt service, operation and maintenance purposes, or
106	106	contract purposes, the board shall give notice of each meeting of
107	107	the board at which the adoption of a tax rate will be considered.
108	108	The notice must:
109	109	(1) contain a statement in substantially the following
110	110	form:
111	111	"NOTICE OF PUBLIC HEARING ON TAX RATE
112	112	"The (name of the district) will hold a public hearing on a
113	113	proposed tax rate for the tax year (year of tax levy) on (date and
114	114	time) at (meeting place). Your individual taxes may increase or
115	115	decrease, depending on the change in the taxable value of your
116	116	property in relation to the change in taxable value of all other
117	117	property and the tax rate that is adopted.
118	118	"(Names of all board members and, if a vote was taken, an
119	119	indication of how each voted on the proposed tax rate and an
120	120	indication of any absences.)";
121	121	(2) contain the following information:
122	122	(A) the district's total adopted tax rate for the
123	123	preceding year and the proposed tax rate, expressed as an amount per
124	124	$100;
125	125	(B) the difference, expressed as an amount per
126	126	$100 and as a percent increase or decrease, as applicable, in the
127	127	proposed tax rate compared to the adopted tax rate for the preceding
128	128	year;
129	129	(C) the average appraised value of a residence
130	130	homestead in the district in the preceding year and in the current
131	131	year; the district's total homestead exemption, other than an
132	132	exemption available only to disabled persons or persons 65 years of
133	133	age or older, applicable to that appraised value in each of those
134	134	years; and the average taxable value of a residence homestead in the
135	135	district in each of those years, disregarding any homestead
136	136	exemption available only to disabled persons or persons 65 years of
137	137	age or older;
138	138	(D) the amount of tax that would have been
139	139	imposed by the district in the preceding year on a residence
140	140	homestead appraised at the average appraised value of a residence
141	141	homestead in that year, disregarding any homestead exemption
142	142	available only to disabled persons or persons 65 years of age or
143	143	older;
144	144	(E) the amount of tax that would be imposed by the
145	145	district in the current year on a residence homestead appraised at
146	146	the average appraised value of a residence homestead in that year,
147	147	disregarding any homestead exemption available only to disabled
148	148	persons or persons 65 years of age or older, if the proposed tax
149	149	rate is adopted; [and]
150	150	(F) the difference between the amounts of tax
151	151	calculated under Paragraphs (D) and (E), expressed in dollars and
152	152	cents and described as the annual percentage increase or decrease,
153	153	as applicable, in the tax to be imposed by the district on the
154	154	average residence homestead in the district in the current year if
155	155	the proposed tax rate is adopted; and
156	156	(G) if the proposed combined debt service,
157	157	operation and maintenance, and contract tax rate exceeds the
158	158	rollback tax rate, a description of the purpose of the proposed tax
159	159	increase; and
160	160	(3) contain a statement in substantially the following
161	161	form:
162	162	"NOTICE OF TAXPAYERS' RIGHT TO ROLLBACK ELECTION
163	163	"If operation and maintenance taxes on the average residence
164	164	homestead increase by more than the inflation rate [eight percent],
165	165	the qualified voters of the district by petition may require that an
166	166	election be held to determine whether to reduce the [operation and
167	167	maintenance] tax rate to the rollback tax rate under Section
168	168	49.236(d), Water Code."
169	169	(d) If the governing body of a district adopts a combined
170	170	debt service, operation and maintenance, and contract tax rate that
171	171	exceeds the rollback tax rate [would impose more than 1.08 times the
172	172	amount of tax imposed by the district in the preceding year on a
173	173	residence homestead appraised at the average appraised value of a
174	174	residence homestead in the district in that year, disregarding any
175	175	homestead exemption available only to disabled persons or persons
176	176	65 years of age or older], the qualified voters of the district by
177	177	petition may require that an election be held to determine whether
178	178	[or not] to reduce the tax rate adopted for the current year to the
179	179	rollback tax rate in accordance with the procedures provided by
180	180	Sections 26.07(b)-(g) and 26.081, Tax Code. For purposes of
181	181	Sections 26.07(b)-(g) and this section [subsection], the rollback
182	182	tax rate is the sum of the following tax rates:
183	183	(1) the current year's debt service tax rate;
184	184	(2) the current year's [and] contract tax rate; and
185	185	(3) [rates plus] the operation and maintenance tax
186	186	rate that would impose [1.08 times] the amount of the operation and
187	187	maintenance tax imposed by the district in the preceding year on a
188	188	residence homestead appraised at the average appraised value of a
189	189	residence homestead in the district in that year, disregarding any
190	190	homestead exemption available only to disabled persons or persons
191	191	65 years of age or older, multiplied by the sum of one and the
192	192	inflation rate.
193	193	(e) In this section, "inflation rate" means the rate
194	194	determined by the comptroller and published in the Texas Register
195	195	as provided by Section 26.04(b-1), Tax Code.
196	196	SECTION 6. The following provisions are repealed:
197	197	(1) Section 49.236, Water Code, as added by Chapter
198	198	248 (H.B. 1541), Acts of the 78th Legislature, Regular Session,
199	199	2003; and
200	200	(2) Section 49.2361, Water Code.
201	201	SECTION 7. The change in law made by this Act applies to the
202	202	ad valorem tax rate of a taxing unit beginning with the 2018 tax
203	203	year.
204	204	SECTION 8. This Act takes effect January 1, 2018.