85S10111 TJB-D
By: Neave H.B. No. 261
A BILL TO BE ENTITLED
AN ACT
relating to a temporary limitation on the total amount of ad valorem
taxes that may be imposed by a taxing unit on a residence homestead
rendered uninhabitable or unusable as a result of a natural
disaster.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 11, Tax Code, is amended by
adding Section 11.262 to read as follows:
Sec. 11.262. LIMITATION OF TAX ON HOMESTEADS DAMAGED IN
DISASTER AREA. (a) In this section, "residence homestead" has the
meaning assigned by Section 11.13.
(b) This section applies only to a residence homestead that
is:
(1) located in an area declared by the governor to be a
disaster area following a natural disaster; and
(2) rendered uninhabitable or unusable as a result of
the disaster.
(c) A taxing unit may not increase during the period
prescribed by Subsection (d) the total annual amount of ad valorem
taxes the taxing unit imposes on a residence homestead above the
amount of the taxes the taxing unit imposed on the residence
homestead for the tax year in which the residence homestead was
rendered uninhabitable or unusable as a result of a natural
disaster if:
(1) the owner of the residence homestead submits an
application for the limitation to the chief appraiser of the
appraisal district in which the residence homestead is located not
later than the first anniversary of the date the residence
homestead is rendered uninhabitable or unusable; and
(2) the chief appraiser determines that the residence
homestead was rendered uninhabitable or unusable as a result of the
natural disaster.
(d) The limitation provided by this section:
(1) takes effect on January 1 of the first tax year
following the tax year in which the natural disaster that renders
the residence homestead uninhabitable or unusable occurs; and
(2) expires on January 1 of the earlier of:
(A) the first tax year following the tax year in
which the fifth anniversary of the natural disaster occurs; or
(B) the first tax year in which the property no
longer qualifies as the residence homestead of:
(i) the property owner claiming the
limitation under this section; or
(ii) the surviving spouse of the property
owner if the surviving spouse is entitled to the limitation under
this section.
(e) If a property owner who qualifies for a limitation under
this section dies, the surviving spouse of the owner is entitled to
the limitation for the residence homestead of the owner for the
period prescribed by Subsection (d) if the residence homestead:
(1) is the residence homestead of the surviving spouse
on the date that the owner dies; and
(2) remains the residence homestead of the surviving
spouse.
(f) This subsection applies only if a property owner submits
an application under this section to the chief appraiser after the
tax year in which the natural disaster occurs that renders the
owner's residence homestead uninhabitable or unusable, the chief
appraiser approves the application, and the taxes imposed by a
taxing unit on the residence homestead for that tax year are greater
than the taxes imposed by the taxing unit for the preceding tax
year. If the tax bill for the current tax year has been mailed and
the tax on the residence homestead has not been paid, the assessor
shall mail a corrected tax bill to the person in whose name the
residence homestead is listed on the tax roll or to the person's
authorized agent. If the tax on the residence homestead for the
current tax year has been paid, the tax collector for the taxing
unit shall refund to the person who paid the tax the amount by which
the payment exceeded the tax due.
(g) For each school district in an appraisal district, the
chief appraiser shall determine the portion of the appraised value
of residence homesteads of individuals on which school district
taxes are not imposed in a tax year because of the limitation on tax
increases under this section. That portion is calculated by
determining the taxable value that, if multiplied by the tax rate
adopted by the school district for the tax year, would produce an
amount equal to the amount of tax that would have been imposed by
the school district on those homesteads if the limitation on tax
increases under this section were not in effect, but that was not
imposed because of that limitation. The chief appraiser shall
determine that taxable value and certify it to the comptroller as
soon as practicable for each tax year.
SECTION 2. Sections 23.19(b) and (g), Tax Code, are amended
to read as follows:
(b) If an appraisal district receives a written request for
the appraisal of real property and improvements of a cooperative
housing corporation according to the separate interests of the
corporation's stockholders, the chief appraiser shall separately
appraise the interests described by Subsection (d) if the
conditions required by Subsections (e) and (f) have been met.
Separate appraisal under this section is for the purposes of
administration of tax exemptions, determination of applicable
limitations of taxes under Section 11.26, [or] 11.261, or 11.262,
and apportionment by a cooperative housing corporation of property
taxes among its stockholders but is not the basis for determining
value on which a tax is imposed under this title. A stockholder
whose interest is separately appraised under this section may
protest and appeal the appraised value in the manner provided by
this title for protest and appeal of the appraised value of other
property.
(g) A tax bill or a separate statement accompanying the tax
bill to a cooperative housing corporation for which interests of
stockholders are separately appraised under this section must
state, in addition to the information required by Section 31.01,
the appraised value and taxable value of each interest separately
appraised. Each exemption claimed as provided by this title by a
person entitled to the exemption shall also be deducted from the
total appraised value of the property of the corporation. The total
tax imposed by a taxing unit [school district, county,
municipality, or junior college district] shall be reduced by any
amount that represents an increase in taxes attributable to
separately appraised interests of the real property and
improvements that are subject to the limitation of taxes prescribed
by Section 11.26, [or] 11.261, or 11.262. The corporation shall
apportion among its stockholders liability for reimbursing the
corporation for property taxes according to the relative taxable
values of their interests.
SECTION 3. Sections 26.012(6), (13), and (14), Tax Code,
are amended to read as follows:
(6) "Current total value" means the total taxable
value of property listed on the appraisal roll for the current year,
including all appraisal roll supplements and corrections as of the
date of the calculation, less the taxable value of property
exempted for the current tax year for the first time under Section
11.31 or 11.315, except that:
(A) the current total value for a school district
excludes:
(i) the total value of homesteads that
qualify for a tax limitation as provided by Section 11.26; and
(ii) new property value of property that is
subject to an agreement entered into under Chapter 313; [and]
(B) the current total value for a county,
municipality, or junior college district excludes the total value
of homesteads that qualify for a tax limitation provided by Section
11.261 applicable to the taxing unit; and
(C) the current total value for a taxing unit
excludes the total value of homesteads that qualify for a tax
limitation provided by Section 11.262 applicable to the taxing
unit.
(13) "Last year's levy" means the total of:
(A) the amount of taxes that would be generated
by multiplying the total tax rate adopted by the governing body in
the preceding year by the total taxable value of property on the
appraisal roll for the preceding year, including:
(i) taxable value that was reduced in an
appeal under Chapter 42; and
(ii) all appraisal roll supplements and
corrections other than corrections made pursuant to Section
25.25(d), as of the date of the calculation, except that last year's
taxable value for a school district excludes the total value of
homesteads that qualified for a tax limitation as provided by
Section 11.26, [and] last year's taxable value for a county,
municipality, or junior college district excludes the total value
of homesteads that qualified for a tax limitation as provided by
Section 11.261 applicable to the taxing unit, and last year's
taxable value for a taxing unit excludes the total value of
homesteads that qualified for a tax limitation as provided by
Section 11.262 applicable to the taxing unit; and
(B) the amount of taxes refunded by the taxing
unit in the preceding year for tax years before that year.
(14) "Last year's total value" means the total taxable
value of property listed on the appraisal roll for the preceding
year, including all appraisal roll supplements and corrections,
other than corrections made pursuant to Section 25.25(d), as of the
date of the calculation, except that:
(A) last year's taxable value for a school
district excludes the total value of homesteads that qualified for
a tax limitation as provided by Section 11.26; [and]
(B) last year's taxable value for a county,
municipality, or junior college district excludes the total value
of homesteads that qualified for a tax limitation as provided by
Section 11.261 applicable to the taxing unit; and
(C) last year's taxable value for a taxing unit
excludes the total value of homesteads that qualified for a tax
limitation as provided by Section 11.262 applicable to the taxing
unit.
SECTION 4. Section 31.01, Tax Code, is amended by adding
Subsection (c-3) to read as follows:
(c-3) This subsection applies only to taxes imposed on a
residence homestead subject to the limitation authorized by Section
11.262 for the tax year preceding the tax year in which the
limitation expires under Section 11.262(d)(2)(A). The tax bill or
separate statement described by Subsection (c) must include
notification that the limitation will expire and that the amount of
taxes imposed on the property may increase in the following tax
year.
SECTION 5. Section 44.004(c), Education Code, is amended to
read as follows:
(c) The notice of public meeting to discuss and adopt the
budget and the proposed tax rate may not be smaller than one-quarter
page of a standard-size or a tabloid-size newspaper, and the
headline on the notice must be in 18-point or larger type. Subject
to Subsection (d), the notice must:
(1) contain a statement in the following form:
"NOTICE OF PUBLIC MEETING TO DISCUSS BUDGET AND PROPOSED TAX RATE
"The (name of school district) will hold a public meeting at
(time, date, year) in (name of room, building, physical location,
city, state). The purpose of this meeting is to discuss the school
district's budget that will determine the tax rate that will be
adopted. Public participation in the discussion is invited." The
statement of the purpose of the meeting must be in bold type. In
reduced type, the notice must state: "The tax rate that is
ultimately adopted at this meeting or at a separate meeting at a
later date may not exceed the proposed rate shown below unless the
district publishes a revised notice containing the same information
and comparisons set out below and holds another public meeting to
discuss the revised notice.";
(2) contain a section entitled "Comparison of Proposed
Budget with Last Year's Budget," which must show the difference,
expressed as a percent increase or decrease, as applicable, in the
amounts budgeted for the preceding fiscal year and the amount
budgeted for the fiscal year that begins in the current tax year for
each of the following:
(A) maintenance and operations;
(B) debt service; and
(C) total expenditures;
(3) contain a section entitled "Total Appraised Value
and Total Taxable Value," which must show the total appraised value
and the total taxable value of all property and the total appraised
value and the total taxable value of new property taxable by the
district in the preceding tax year and the current tax year as
calculated under Section 26.04, Tax Code;
(4) contain a statement of the total amount of the
outstanding and unpaid bonded indebtedness of the school district;
(5) contain a section entitled "Comparison of Proposed
Rates with Last Year's Rates," which must:
(A) show in rows the tax rates described by
Subparagraphs (i)-(iii), expressed as amounts per $100 valuation of
property, for columns entitled "Maintenance & Operations,"
"Interest & Sinking Fund," and "Total," which is the sum of
"Maintenance & Operations" and "Interest & Sinking Fund":
(i) the school district's "Last Year's
Rate";
(ii) the "Rate to Maintain Same Level of
Maintenance & Operations Revenue & Pay Debt Service," which:
(a) in the case of "Maintenance &
Operations," is the tax rate that, when applied to the current
taxable value for the district, as certified by the chief appraiser
under Section 26.01, Tax Code, and as adjusted to reflect changes
made by the chief appraiser as of the time the notice is prepared,
would impose taxes in an amount that, when added to state funds to
be distributed to the district under Chapter 42, would provide the
same amount of maintenance and operations taxes and state funds
distributed under Chapter 42 per student in average daily
attendance for the applicable school year that was available to the
district in the preceding school year; and
(b) in the case of "Interest & Sinking
Fund," is the tax rate that, when applied to the current taxable
value for the district, as certified by the chief appraiser under
Section 26.01, Tax Code, and as adjusted to reflect changes made by
the chief appraiser as of the time the notice is prepared, and when
multiplied by the district's anticipated collection rate, would
impose taxes in an amount that, when added to state funds to be
distributed to the district under Chapter 46 and any excess taxes
collected to service the district's debt during the preceding tax
year but not used for that purpose during that year, would provide
the amount required to service the district's debt; and
(iii) the "Proposed Rate";
(B) contain fourth and fifth columns aligned with
the columns required by Paragraph (A) that show, for each row
required by Paragraph (A):
(i) the "Local Revenue per Student," which
is computed by multiplying the district's total taxable value of
property, as certified by the chief appraiser for the applicable
school year under Section 26.01, Tax Code, and as adjusted to
reflect changes made by the chief appraiser as of the time the
notice is prepared, by the total tax rate, and dividing the product
by the number of students in average daily attendance in the
district for the applicable school year; and
(ii) the "State Revenue per Student," which
is computed by determining the amount of state aid received or to be
received by the district under Chapters 42, 43, and 46 and dividing
that amount by the number of students in average daily attendance in
the district for the applicable school year; and
(C) contain an asterisk after each calculation
for "Interest & Sinking Fund" and a footnote to the section that, in
reduced type, states "The Interest & Sinking Fund tax revenue is
used to pay for bonded indebtedness on construction, equipment, or
both. The bonds, and the tax rate necessary to pay those bonds,
were approved by the voters of this district.";
(6) contain a section entitled "Comparison of Proposed
Levy with Last Year's Levy on Average Residence," which must:
(A) show in rows the information described by
Subparagraphs (i)-(iv), rounded to the nearest dollar, for columns
entitled "Last Year" and "This Year":
(i) "Average Market Value of Residences,"
determined using the same group of residences for each year;
(ii) "Average Taxable Value of Residences,"
determined after taking into account the limitation on the
appraised value of residences under Section 23.23, Tax Code, and
after subtracting all homestead exemptions applicable in each year,
other than exemptions available only to disabled persons or persons
65 years of age or older or their surviving spouses, and using the
same group of residences for each year;
(iii) "Last Year's Rate Versus Proposed
Rate per $100 Value"; and
(iv) "Taxes Due on Average Residence,"
determined using the same group of residences for each year; and
(B) contain the following information:
"Increase (Decrease) in Taxes" expressed in dollars and cents,
which is computed by subtracting the "Taxes Due on Average
Residence" for the preceding tax year from the "Taxes Due on Average
Residence" for the current tax year;
(7) contain the following statement in bold print:
"Under state law, the dollar amount of school taxes imposed on the
residence of a person 65 years of age or older or of the surviving
spouse of such a person, if the surviving spouse was 55 years of age
or older when the person died, may not be increased above the amount
paid in the first year after the person turned 65, regardless of
changes in tax rate or property value.";
(8) contain the following statement in bold print:
"Notice of Rollback Rate: The highest tax rate the district can
adopt before requiring voter approval at an election is (the school
district rollback rate determined under Section 26.08, Tax Code).
This election will be automatically held if the district adopts a
rate in excess of the rollback rate of (the school district rollback
rate)."; [and]
(9) contain a section entitled "Fund Balances," which
must include the estimated amount of interest and sinking fund
balances and the estimated amount of maintenance and operation or
general fund balances remaining at the end of the current fiscal
year that are not encumbered with or by corresponding debt
obligation, less estimated funds necessary for the operation of the
district before the receipt of the first payment under Chapter 42 in
the succeeding school year; and
(10) contain the following statement in bold print:
"Under state law, the dollar amount of school taxes imposed on a
residence homestead rendered uninhabitable or unusable as a result
of a natural disaster may not for a temporary period be increased
above the amount of school taxes imposed on the property in the year
in which the natural disaster rendered the residence homestead
uninhabitable or unusable, regardless of changes in tax rate or
property value.".
SECTION 6. Section 403.302(d), Government Code, is amended
to read as follows:
(d) For the purposes of this section, "taxable value" means
the market value of all taxable property less:
(1) the total dollar amount of any residence homestead
exemptions lawfully granted under Section 11.13(b) or (c), Tax
Code, in the year that is the subject of the study for each school
district;
(2) one-half of the total dollar amount of any
residence homestead exemptions granted under Section 11.13(n), Tax
Code, in the year that is the subject of the study for each school
district;
(3) the total dollar amount of any exemptions granted
before May 31, 1993, within a reinvestment zone under agreements
authorized by Chapter 312, Tax Code;
(4) subject to Subsection (e), the total dollar amount
of any captured appraised value of property that:
(A) is within a reinvestment zone created on or
before May 31, 1999, or is proposed to be included within the
boundaries of a reinvestment zone as the boundaries of the zone and
the proposed portion of tax increment paid into the tax increment
fund by a school district are described in a written notification
provided by the municipality or the board of directors of the zone
to the governing bodies of the other taxing units in the manner
provided by former Section 311.003(e), Tax Code, before May 31,
1999, and within the boundaries of the zone as those boundaries
existed on September 1, 1999, including subsequent improvements to
the property regardless of when made;
(B) generates taxes paid into a tax increment
fund created under Chapter 311, Tax Code, under a reinvestment zone
financing plan approved under Section 311.011(d), Tax Code, on or
before September 1, 1999; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(5) the total dollar amount of any captured appraised
value of property that:
(A) is within a reinvestment zone:
(i) created on or before December 31, 2008,
by a municipality with a population of less than 18,000; and
(ii) the project plan for which includes
the alteration, remodeling, repair, or reconstruction of a
structure that is included on the National Register of Historic
Places and requires that a portion of the tax increment of the zone
be used for the improvement or construction of related facilities
or for affordable housing;
(B) generates school district taxes that are paid
into a tax increment fund created under Chapter 311, Tax Code; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(6) the total dollar amount of any exemptions granted
under Section 11.251 or 11.253, Tax Code;
(7) the difference between the comptroller's estimate
of the market value and the productivity value of land that
qualifies for appraisal on the basis of its productive capacity,
except that the productivity value estimated by the comptroller may
not exceed the fair market value of the land;
(8) the portion of the appraised value of residence
homesteads of individuals who receive a tax limitation under
Section 11.26 or 11.262, Tax Code, on which school district taxes
are not imposed in the year that is the subject of the study,
calculated as if the residence homesteads were appraised at the
full value required by law;
(9) a portion of the market value of property not
otherwise fully taxable by the district at market value because of:
(A) action required by statute or the
constitution of this state, other than Section 11.311, Tax Code,
that, if the tax rate adopted by the district is applied to it,
produces an amount equal to the difference between the tax that the
district would have imposed on the property if the property were
fully taxable at market value and the tax that the district is
actually authorized to impose on the property, if this subsection
does not otherwise require that portion to be deducted; or
(B) action taken by the district under Subchapter
B or C, Chapter 313, Tax Code, before the expiration of the
subchapter;
(10) the market value of all tangible personal
property, other than manufactured homes, owned by a family or
individual and not held or used for the production of income;
(11) the appraised value of property the collection of
delinquent taxes on which is deferred under Section 33.06, Tax
Code;
(12) the portion of the appraised value of property
the collection of delinquent taxes on which is deferred under
Section 33.065, Tax Code; and
(13) the amount by which the market value of a
residence homestead to which Section 23.23, Tax Code, applies
exceeds the appraised value of that property as calculated under
that section.
SECTION 7. The changes in law made by this Act apply only to
a residence homestead rendered uninhabitable or unusable by a
natural disaster that occurs on or after the effective date of this
Act.
SECTION 8. This Act takes effect January 1, 2018, but only
if the constitutional amendment proposed by the 85th Legislature,
1st Called Session, 2017, authorizing the legislature to limit for
a temporary period the total amount of ad valorem taxes that may be
imposed by a political subdivision on a residence homestead
rendered uninhabitable or unusable as a result of a natural
disaster is approved by the voters. If that amendment is not
approved by the voters, this Act has no effect.