Texas 2017 - 85th Regular

Texas House Bill HB1165 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85R3108 SMH-F
2	2	By: Paul H.B. No. 1165
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 and voter approval of a proposed tax rate that exceeds
9	9	the rollback tax rate.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Section 26.04, Tax Code, is amended by amending
12	12	Subsection (c) and adding Subsection (c-1) to read as follows:
13	13	(c) An officer or employee designated by the governing body
14	14	shall calculate the effective tax rate and the rollback tax rate for
15	15	the unit, where:
16	16	(1) "Effective tax rate" means a rate expressed in
17	17	dollars per $100 of taxable value calculated according to the
18	18	following formula:
19	19	EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY
20	20	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
21	21	; and
22	22	(2) "Rollback tax rate" means a rate expressed in
23	23	dollars per $100 of taxable value calculated according to the
24	24	following formula:
25	25	ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
26	26	OPERATIONS RATE x 1.06 [1.08]) + CURRENT DEBT RATE
27	27	(c-1) Notwithstanding any other provision of this section,
28	28	the governing body may direct the designated officer or employee to
29	29	substitute "1.08" for "1.06" in the calculation of the rollback tax
30	30	rate if any part of the taxing unit is located in an area declared a
31	31	disaster area during the current tax year by the governor or by the
32	32	president of the United States.
33	33	SECTION 2. Section 26.041, Tax Code, is amended by amending
34	34	Subsections (a), (b), and (c) and adding Subsection (c-1) to read as
35	35	follows:
36	36	(a) In the first year in which an additional sales and use
37	37	tax is required to be collected, the effective tax rate and rollback
38	38	tax rate for the unit are calculated according to the following
39	39	formulas:
40	40	EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
41	41	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] -
42	42	SALES TAX GAIN RATE
43	43	and
44	44	ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND
45	45	OPERATIONS RATE x 1.06 [1.08]) + CURRENT DEBT RATE -
46	46	SALES TAX GAIN RATE
47	47	where "sales tax gain rate" means a number expressed in dollars per
48	48	$100 of taxable value, calculated by dividing the revenue that will
49	49	be generated by the additional sales and use tax in the following
50	50	year as calculated under Subsection (d) [of this section] by the
51	51	current total value.
52	52	(b) Except as provided by Subsections (a) and (c) [of this
53	53	section], in a year in which a taxing unit imposes an additional
54	54	sales and use tax the rollback tax rate for the unit is calculated
55	55	according to the following formula, regardless of whether the unit
56	56	levied a property tax in the preceding year:
57	57	ROLLBACK TAX RATE = [(LAST YEAR'S MAINTENANCE AND
58	58	OPERATIONS EXPENSE x 1.06 [1.08]) / ([TOTAL] CURRENT
59	59	TOTAL VALUE - NEW PROPERTY VALUE)] + (CURRENT DEBT RATE
60	60	- SALES TAX REVENUE RATE)
61	61	where "last year's maintenance and operations expense" means the
62	62	amount spent for maintenance and operations from property tax and
63	63	additional sales and use tax revenues in the preceding year, and
64	64	"sales tax revenue rate" means a number expressed in dollars per
65	65	$100 of taxable value, calculated by dividing the revenue that will
66	66	be generated by the additional sales and use tax in the current year
67	67	as calculated under Subsection (d) [of this section] by the current
68	68	total value.
69	69	(c) In a year in which a taxing unit that has been imposing
70	70	an additional sales and use tax ceases to impose an additional sales
71	71	and use tax the effective tax rate and rollback tax rate for the
72	72	unit are calculated according to the following formulas:
73	73	EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY
74	74	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
75	75	SALES TAX LOSS RATE
76	76	and
77	77	ROLLBACK TAX RATE = [(LAST YEAR'S MAINTENANCE AND
78	78	OPERATIONS EXPENSE x 1.06 [1.08]) / ([TOTAL] CURRENT
79	79	TOTAL VALUE - NEW PROPERTY VALUE)] + CURRENT DEBT RATE
80	80	where "sales tax loss rate" means a number expressed in dollars per
81	81	$100 of taxable value, calculated by dividing the amount of sales
82	82	and use tax revenue generated in the last four quarters for which
83	83	the information is available by the current total value and "last
84	84	year's maintenance and operations expense" means the amount spent
85	85	for maintenance and operations from property tax and additional
86	86	sales and use tax revenues in the preceding year.
87	87	(c-1) Notwithstanding any other provision of this section,
88	88	the governing body may direct the designated officer or employee to
89	89	substitute "1.08" for "1.06" in the calculation of the rollback tax
90	90	rate if any part of the taxing unit is located in an area declared a
91	91	disaster area during the current tax year by the governor or by the
92	92	president of the United States.
93	93	SECTION 3. The heading to Section 26.08, Tax Code, is
94	94	amended to read as follows:
95	95	Sec. 26.08. ELECTION TO RATIFY TAX RATE [SCHOOL TAXES].
96	96	SECTION 4. Sections 26.08(a), (b), (d), (d-1), (d-2), (e),
97	97	and (h), Tax Code, are amended to read as follows:
98	98	(a) If the governing body of a taxing unit [school district]
99	99	adopts a tax rate that exceeds the taxing unit's [district's]
100	100	rollback tax rate, the registered voters of the taxing unit
101	101	[district] at an election held for that purpose must determine
102	102	whether to approve the adopted tax rate. When increased
103	103	expenditure of money by a taxing unit [school district] is
104	104	necessary to respond to a disaster, including a tornado, hurricane,
105	105	flood, or other calamity, but not including a drought, that has
106	106	impacted the taxing unit [a school district] and the governor has
107	107	requested federal disaster assistance for the area in which the
108	108	taxing unit [school district] is located, an election is not
109	109	required under this section to approve the tax rate adopted by the
110	110	governing body for the year following the year in which the disaster
111	111	occurs.
112	112	(b) The governing body shall order that the election be held
113	113	in the taxing unit [school district] on a date not less than 30 or
114	114	more than 90 days after the day on which it adopted the tax rate.
115	115	Section 41.001, Election Code, does not apply to the election
116	116	unless a date specified by that section falls within the time
117	117	permitted by this section. At the election, the ballots shall be
118	118	prepared to permit voting for or against the
119	119	proposition: "Approving the ad valorem tax rate of $_____ per $100
120	120	valuation in (name of taxing unit [school district]) for the
121	121	current year, a rate that is $_____ higher per $100 valuation than
122	122	the [school district] rollback tax rate of (name of taxing unit),
123	123	for the purpose of (description of purpose of increase)." The
124	124	ballot proposition must include the adopted tax rate and the
125	125	difference between that rate and the rollback tax rate in the
126	126	appropriate places.
127	127	(d) If the proposition is not approved as provided by
128	128	Subsection (c), the governing body may not adopt a tax rate for the
129	129	taxing unit [school district] for the current year that exceeds the
130	130	taxing unit's [school district's] rollback tax rate.
131	131	(d-1) If, after tax bills for the taxing unit [school
132	132	district] have been mailed, a proposition to approve the taxing
133	133	unit's [school district's] adopted tax rate is not approved by the
134	134	voters of the taxing unit [district] at an election held under this
135	135	section, on subsequent adoption of a new tax rate by the governing
136	136	body of the taxing unit [district], the assessor for the taxing unit
137	137	[school] shall prepare and mail corrected tax bills. The assessor
138	138	shall include with each bill a brief explanation of the reason for
139	139	and effect of the corrected bill. The date on which the taxes
140	140	become delinquent for the year is extended by a number of days equal
141	141	to the number of days between the date the first tax bills were sent
142	142	and the date the corrected tax bills were sent.
143	143	(d-2) If a property owner pays taxes calculated using the
144	144	originally adopted tax rate of the taxing unit [school district]
145	145	and the proposition to approve the adopted tax rate is not approved
146	146	by the voters, the taxing unit [school district] shall refund the
147	147	difference between the amount of taxes paid and the amount due under
148	148	the subsequently adopted rate if the difference between the amount
149	149	of taxes paid and the amount due under the subsequent rate is $1 or
150	150	more. If the difference between the amount of taxes paid and the
151	151	amount due under the subsequent rate is less than $1, the taxing
152	152	unit [school district] shall refund the difference on request of
153	153	the taxpayer. An application for a refund of less than $1 must be
154	154	made within 90 days after the date the refund becomes due or the
155	155	taxpayer forfeits the right to the refund.
156	156	(e) For purposes of this section, local tax funds dedicated
157	157	to a junior college district under Section 45.105(e), Education
158	158	Code, shall be eliminated from the calculation of the tax rate
159	159	adopted by the governing body of a [the] school district. However,
160	160	the funds dedicated to the junior college district are subject to
161	161	Section 26.085.
162	162	(h) For purposes of this section, increases in taxable
163	163	values and tax levies occurring within a reinvestment zone under
164	164	Chapter 311 (Tax Increment Financing Act), in which a school [the]
165	165	district is a participant, shall be eliminated from the calculation
166	166	of the tax rate adopted by the governing body of the school
167	167	district.
168	168	SECTION 5. Section 26.16(d), Tax Code, is amended to read as
169	169	follows:
170	170	(d) The county assessor-collector shall post immediately
171	171	below the table prescribed by Subsection (c) the following
172	172	statement:
173	173	"The county is providing this table of property tax rate
174	174	information as a service to the residents of the county. Each
175	175	individual taxing unit is responsible for calculating the property
176	176	tax rates listed in this table pertaining to that taxing unit and
177	177	providing that information to the county.
178	178	"The adopted tax rate is the tax rate adopted by the governing
179	179	body of a taxing unit.
180	180	"The maintenance and operations rate is the component of the
181	181	adopted tax rate of a taxing unit that will impose the amount of
182	182	taxes needed to fund maintenance and operation expenditures of the
183	183	unit for the following year.
184	184	"The debt rate is the component of the adopted tax rate of a
185	185	taxing unit that will impose the amount of taxes needed to fund the
186	186	unit's debt service for the following year.
187	187	"The effective tax rate is the tax rate that would generate
188	188	the same amount of revenue in the current tax year as was generated
189	189	by a taxing unit's adopted tax rate in the preceding tax year from
190	190	property that is taxable in both the current tax year and the
191	191	preceding tax year.
192	192	"The effective maintenance and operations rate is the tax
193	193	rate that would generate the same amount of revenue for maintenance
194	194	and operations in the current tax year as was generated by a taxing
195	195	unit's maintenance and operations rate in the preceding tax year
196	196	from property that is taxable in both the current tax year and the
197	197	preceding tax year.
198	198	"The rollback tax rate is the highest tax rate a taxing unit
199	199	may adopt before requiring voter approval at an election. An [In
200	200	the case of a taxing unit other than a school district, the voters
201	201	by petition may require that a rollback election be held if the unit
202	202	adopts a tax rate in excess of the unit's rollback tax rate. In the
203	203	case of a school district, an] election will automatically be held
204	204	if a taxing unit [the district] wishes to adopt a tax rate in excess
205	205	of the unit's [district's] rollback tax rate."
206	206	SECTION 6. Sections 31.12(a) and (b), Tax Code, are amended
207	207	to read as follows:
208	208	(a) If a refund of a tax provided by Section 11.431(b),
209	209	26.08(d-2) [26.07(g)], 26.15(f), 31.11, or 31.111 is paid on or
210	210	before the 60th day after the date the liability for the refund
211	211	arises, no interest is due on the amount refunded. If not paid on or
212	212	before that 60th day, the amount of the tax to be refunded accrues
213	213	interest at a rate of one percent for each month or part of a month
214	214	that the refund is unpaid, beginning with the date on which the
215	215	liability for the refund arises.
216	216	(b) For purposes of this section, liability for a refund
217	217	arises:
218	218	(1) if the refund is required by Section 11.431(b), on
219	219	the date the chief appraiser notifies the collector for the unit of
220	220	the approval of the late homestead exemption;
221	221	(2) if the refund is required by Section 26.08(d-2)
222	222	[26.07(g)], on the date the results of the election to reduce the
223	223	tax rate are certified;
224	224	(3) if the refund is required by Section 26.15(f):
225	225	(A) for a correction to the tax roll made under
226	226	Section 26.15(b), on the date the change in the tax roll is
227	227	certified to the assessor for the taxing unit under Section 25.25;
228	228	or
229	229	(B) for a correction to the tax roll made under
230	230	Section 26.15(c), on the date the change in the tax roll is ordered
231	231	by the governing body of the taxing unit;
232	232	(4) if the refund is required by Section 31.11, on the
233	233	date the auditor for the taxing unit determines that the payment was
234	234	erroneous or excessive or, if the amount of the refund exceeds the
235	235	applicable amount specified by Section 31.11(a), on the date the
236	236	governing body of the unit approves the refund; or
237	237	(5) if the refund is required by Section 31.111, on the
238	238	date the collector for the taxing unit determines that the payment
239	239	was erroneous.
240	240	SECTION 7. Section 33.08(b), Tax Code, is amended to read as
241	241	follows:
242	242	(b) The governing body of the taxing unit or appraisal
243	243	district, in the manner required by law for official action, may
244	244	provide that taxes that become delinquent on or after June 1 under
245	245	Section 26.08(d-1) [26.07(f)], 26.15(e), 31.03, 31.031, 31.032,
246	246	31.04, or 42.42 incur an additional penalty to defray costs of
247	247	collection. The amount of the penalty may not exceed the amount of
248	248	the compensation specified in the applicable contract with an
249	249	attorney under Section 6.30 to be paid in connection with the
250	250	collection of the delinquent taxes.
251	251	SECTION 8. Section 130.016(b), Education Code, is amended
252	252	to read as follows:
253	253	(b) If the board of trustees of an independent school
254	254	district that divests itself of the management, control, and
255	255	operation of a junior college district under this section or under
256	256	Section 130.017 [of this code] was authorized by [Subsection (e)
257	257	of] Section 45.105(e) or under former Section 20.48(e) [20.48 of
258	258	this code] to dedicate a portion of its tax levy to the junior
259	259	college district before the divestment, the junior college district
260	260	may levy an ad valorem tax from and after the divestment. In the
261	261	first two years in which the junior college district levies an ad
262	262	valorem tax, the tax rate adopted by the governing body may not
263	263	exceed the rate that, if applied to the total taxable value
264	264	submitted to the governing body under Section 26.04, Tax Code,
265	265	would impose an amount equal to the amount of taxes of the school
266	266	district dedicated to the junior college under [Subsection (e) of]
267	267	Section 45.105(e) or former Section 20.48(e) [20.48 of this code]
268	268	in the last dedication before the divestment. In subsequent years,
269	269	the tax rate of the junior college district is subject to Section
270	270	26.08 [26.07], Tax Code.
271	271	SECTION 9. Sections 281.124(d) and (e), Health and Safety
272	272	Code, are amended to read as follows:
273	273	(d) If a majority of the votes cast in the election favor the
274	274	proposition, the tax rate for the specified tax year is the rate
275	275	approved by the voters, and that rate is not subject to [a rollback
276	276	election under] Section 26.08 [26.07], Tax Code. The board shall
277	277	adopt the tax rate as provided by Chapter 26, Tax Code.
278	278	(e) If the proposition is not approved as provided by
279	279	Subsection (c), the board may not adopt a tax rate for the district
280	280	for the specified tax year that exceeds the rate that was not
281	281	approved, and Section 26.08 [26.07], Tax Code, applies to the
282	282	adopted rate if that rate exceeds the district's rollback tax rate.
283	283	SECTION 10. Section 140.010(e), Local Government Code, is
284	284	amended to read as follows:
285	285	(e) A county or municipality that proposes a property tax
286	286	rate that exceeds the lower of the effective tax rate or the
287	287	rollback tax rate shall provide the following notice:
288	288	"NOTICE OF (INSERT CURRENT TAX YEAR) TAX YEAR PROPOSED PROPERTY TAX
289	289	RATE FOR (INSERT NAME OF COUNTY OR MUNICIPALITY)
290	290	"A tax rate of $_____ per $100 valuation has been proposed for
291	291	adoption by the governing body of (insert name of county or
292	292	municipality). This rate exceeds the lower of the effective or
293	293	rollback tax rate, and state law requires that two public hearings
294	294	be held by the governing body before adopting the proposed tax
295	295	rate. The governing body of (insert name of county or
296	296	municipality) proposes to use revenue attributable to the tax rate
297	297	increase for the purpose of (description of purpose of increase).
298	298	PROPOSED TAX RATE$______ per $100
299	299	PRECEDING YEAR'S TAX RATE$______ per $100
300	300	EFFECTIVE TAX RATE$______ per $100
301	301	ROLLBACK TAX RATE$______ per $100
302	302	"The effective tax rate is the total tax rate needed to raise the
303	303	same amount of property tax revenue for (insert name of county or
304	304	municipality) from the same properties in both the (insert
305	305	preceding tax year) tax year and the (insert current tax year) tax
306	306	year.
307	307	"The rollback tax rate is the highest tax rate that (insert name of
308	308	county or municipality) may adopt without holding [before voters
309	309	are entitled to petition for] an election to ratify [limit] the rate
310	310	[that may be approved to the rollback rate].
311	311	"YOUR TAXES OWED UNDER ANY OF THE ABOVE RATES CAN BE CALCULATED AS
312	312	FOLLOWS:
313	313	property tax amount = (rate) x (taxable value of your property) /
314	314	100
315	315	"For assistance or detailed information about tax calculations,
316	316	please contact:
317	317	(insert name of county or municipal tax assessor-collector)
318	318	(insert name of county or municipality) tax
319	319	assessor-collector
320	320	(insert address)
321	321	(insert telephone number)
322	322	(insert e-mail address)
323	323	(insert Internet website address, if applicable)
324	324	"You are urged to attend and express your views at the following
325	325	public hearings on the proposed tax rate:
326	326	First Hearing: (insert date and time) at (insert location of
327	327	meeting).
328	328	Second Hearing: (insert date and time) at (insert location
329	329	of meeting)."
330	330	SECTION 11. Section 1101.254(f), Special District Local
331	331	Laws Code, is amended to read as follows:
332	332	(f) This section does not affect the applicability of [any
333	333	rights district voters may have to petition for an election under]
334	334	Section 26.08 [26.07], Tax Code, to the district's tax rate, except
335	335	that if district voters approve a tax rate increase under this
336	336	section, [the voters may not petition for an election under]
337	337	Section 26.08 [26.07], Tax Code, does not apply [as] to the tax rate
338	338	for that year.
339	339	SECTION 12. Sections 1122.2522, 3828.157, and 8876.152,
340	340	Special District Local Laws Code, are amended to read as follows:
341	341	Sec. 1122.2522. ROLLBACK TAX RATE PROVISIONS APPLICABLE.
342	342	[(a)] If in any year the board adopts a tax rate that exceeds the
343	343	rollback tax rate calculated as provided by Chapter 26, Tax Code,
344	344	[the qualified voters of the district by petition may require that]
345	345	an election under Section 26.08 of that code must be held to
346	346	determine whether or not to approve [reduce] the tax rate adopted by
347	347	the board for that year [to the rollback tax rate].
348	348	[(b) To the extent a conflict exists between this section
349	349	and a provision of the Tax Code, the provision of the Tax Code
350	350	prevails.]
351	351	Sec. 3828.157. INAPPLICABILITY OF CERTAIN TAX CODE
352	352	PROVISIONS. Sections 26.04, 26.05, and 26.08 [26.07], Tax Code, do
353	353	not apply to a tax imposed under Section 3828.153 or 3828.156.
354	354	Sec. 8876.152. APPLICABILITY OF CERTAIN TAX PROVISIONS.
355	355	(a) Sections 26.04, 26.05, 26.06, and 26.08 [26.07], Tax Code, do
356	356	not apply to a tax imposed by the district.
357	357	(b) Sections 49.236(a)(1) and (2) and (b) [Section 49.236],
358	358	Water Code, apply [as added by Chapter 248 (H.B. 1541), Acts of the
359	359	78th Legislature, Regular Session, 2003, applies] to the district.
360	360	SECTION 13. Section 49.107(g), Water Code, is amended to
361	361	read as follows:
362	362	(g) Sections 26.04, 26.05, and 26.08 [26.07], Tax Code, do
363	363	not apply to a tax levied and collected under this section or an ad
364	364	valorem tax levied and collected for the payment of the interest on
365	365	and principal of bonds issued by a district.
366	366	SECTION 14. Section 49.108(f), Water Code, is amended to
367	367	read as follows:
368	368	(f) Sections 26.04, 26.05, and 26.08 [26.07], Tax Code, do
369	369	not apply to a tax levied and collected for payments made under a
370	370	contract approved in accordance with this section.
371	371	SECTION 15. Section 49.236, Water Code, as added by Chapter
372	372	335 (S.B. 392), Acts of the 78th Legislature, Regular Session,
373	373	2003, is amended by amending Subsections (a) and (d) and adding
374	374	Subsection (e) to read as follows:
375	375	(a) Before the board adopts an ad valorem tax rate for the
376	376	district for debt service, operation and maintenance purposes, or
377	377	contract purposes, the board shall give notice of each meeting of
378	378	the board at which the adoption of a tax rate will be considered.
379	379	The notice must:
380	380	(1) contain a statement in substantially the following
381	381	form:
382	382	"NOTICE OF PUBLIC HEARING ON TAX RATE
383	383	"The (name of the district) will hold a public hearing on a
384	384	proposed tax rate for the tax year (year of tax levy) on (date and
385	385	time) at (meeting place). Your individual taxes may increase or
386	386	decrease, depending on the change in the taxable value of your
387	387	property in relation to the change in taxable value of all other
388	388	property and the tax rate that is adopted.
389	389	"(Names of all board members and, if a vote was taken, an
390	390	indication of how each voted on the proposed tax rate and an
391	391	indication of any absences.)";
392	392	(2) contain the following information:
393	393	(A) the district's total adopted tax rate for the
394	394	preceding year and the proposed tax rate, expressed as an amount per
395	395	$100;
396	396	(B) the difference, expressed as an amount per
397	397	$100 and as a percent increase or decrease, as applicable, in the
398	398	proposed tax rate compared to the adopted tax rate for the preceding
399	399	year;
400	400	(C) the average appraised value of a residence
401	401	homestead in the district in the preceding year and in the current
402	402	year; the district's total homestead exemption, other than an
403	403	exemption available only to disabled persons or persons 65 years of
404	404	age or older, applicable to that appraised value in each of those
405	405	years; and the average taxable value of a residence homestead in the
406	406	district in each of those years, disregarding any homestead
407	407	exemption available only to disabled persons or persons 65 years of
408	408	age or older;
409	409	(D) the amount of tax that would have been
410	410	imposed by the district in the preceding year on a residence
411	411	homestead appraised at the average appraised value of a residence
412	412	homestead in that year, disregarding any homestead exemption
413	413	available only to disabled persons or persons 65 years of age or
414	414	older;
415	415	(E) the amount of tax that would be imposed by the
416	416	district in the current year on a residence homestead appraised at
417	417	the average appraised value of a residence homestead in that year,
418	418	disregarding any homestead exemption available only to disabled
419	419	persons or persons 65 years of age or older, if the proposed tax
420	420	rate is adopted; [and]
421	421	(F) the difference between the amounts of tax
422	422	calculated under Paragraphs (D) and (E), expressed in dollars and
423	423	cents and described as the annual percentage increase or decrease,
424	424	as applicable, in the tax to be imposed by the district on the
425	425	average residence homestead in the district in the current year if
426	426	the proposed tax rate is adopted; and
427	427	(G) if the proposed combined debt service,
428	428	operation and maintenance, and contract tax rate exceeds the
429	429	rollback tax rate, a description of the purpose of the proposed tax
430	430	increase; and
431	431	(3) contain a statement in substantially the following
432	432	form:
433	433	"NOTICE OF VOTE ON TAX RATE [TAXPAYERS' RIGHT TO ROLLBACK ELECTION]
434	434	"If operation and maintenance taxes on the average residence
435	435	homestead increase by more than six [eight] percent, [the qualified
436	436	voters of the district by petition may require that] an election
437	437	must be held to determine whether to ratify [reduce] the operation
438	438	and maintenance tax rate [to the rollback tax rate] under Section
439	439	49.236(d), Water Code."
440	440	(d) If the governing body of a district adopts a combined
441	441	debt service, operation and maintenance, and contract tax rate that
442	442	exceeds the rollback tax rate, [would impose more than 1.08 times
443	443	the amount of tax imposed by the district in the preceding year on a
444	444	residence homestead appraised at the average appraised value of a
445	445	residence homestead in the district in that year, disregarding any
446	446	homestead exemption available only to disabled persons or persons
447	447	65 years of age or older, the qualified voters of the district by
448	448	petition may require that] an election must be held to determine
449	449	whether [or not] to ratify [reduce] the tax rate adopted for the
450	450	current year [to the rollback tax rate] in accordance with the
451	451	procedures provided by Sections 26.08(b)-(d) [26.07(b)-(g) and
452	452	26.081], Tax Code. For purposes of Sections 26.08(b)-(d)
453	453	[26.07(b)-(g)] and this section [subsection], the rollback tax rate
454	454	is the sum of the following tax rates:
455	455	(1) the current year's debt service tax rate;
456	456	(2) the current year's [and] contract tax rate; and
457	457	(3) [rates plus] the operation and maintenance tax
458	458	rate that would impose 1.06 [1.08] times the amount of the operation
459	459	and maintenance tax imposed by the district in the preceding year on
460	460	a residence homestead appraised at the average appraised value of a
461	461	residence homestead in the district in that year, disregarding any
462	462	homestead exemption available only to disabled persons or persons
463	463	65 years of age or older.
464	464	(e) Notwithstanding any other provision of this section,
465	465	the board may substitute "eight percent" for "six percent" in
466	466	Subsection (a) and "1.08" for "1.06" in Subsection (d) if any part
467	467	of the district is located in an area declared a disaster area
468	468	during the current tax year by the governor or by the president of
469	469	the United States.
470	470	SECTION 16. The following provisions are repealed:
471	471	(1) Section 1063.255, Special District Local Laws
472	472	Code;
473	473	(2) Section 26.07, Tax Code;
474	474	(3) Section 49.236, Water Code, as added by Chapter
475	475	248 (H.B. 1541), Acts of the 78th Legislature, Regular Session,
476	476	2003; and
477	477	(4) Section 49.2361, Water Code.
478	478	SECTION 17. (a) The change in law made by this Act applies
479	479	to the ad valorem tax rate of a taxing unit beginning with the 2017
480	480	tax year, except as provided by Subsection (b) of this section.
481	481	(b) If the governing body of a taxing unit adopted an ad
482	482	valorem tax rate for the taxing unit for the 2017 tax year before
483	483	the effective date of this Act, the change in law made by this Act
484	484	applies to the ad valorem tax rate of that taxing unit beginning
485	485	with the 2018 tax year, and the law in effect when the tax rate was
486	486	adopted applies to the 2017 tax year with respect to that taxing
487	487	unit.
488	488	SECTION 18. This Act takes effect immediately if it
489	489	receives a vote of two-thirds of all the members elected to each
490	490	house, as provided by Section 39, Article III, Texas Constitution.
491	491	If this Act does not receive the vote necessary for immediate
492	492	effect, this Act takes effect on the 91st day after the last day of
493	493	the legislative session.