86R66 CJC/KJE-D
By: Murr H.B. No. 297
A BILL TO BE ENTITLED
AN ACT
relating to the elimination of certain property taxes for school
district maintenance and operations and the provision of public
education funding by increasing the rates of certain state taxes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. PUBLIC SCHOOL FINANCE
SECTION 1.01. Section 11.1511(c), Education Code, is
amended to read as follows:
(c) The board may:
(1) issue bonds and levy, pledge, assess, and collect
an annual ad valorem tax to pay the principal and interest on the
bonds as authorized under Sections 45.001 and 45.003;
(2) levy, assess, and collect an annual ad valorem tax
for enrichment [maintenance and operation] of the district as
authorized under Sections 45.002 and 45.003;
(3) employ a person to assess or collect the district's
taxes as authorized under Section 45.231; and
(4) enter into contracts as authorized under this code
or other law and delegate contractual authority to the
superintendent as appropriate.
SECTION 1.02. Section 12.013(b), Education Code, is amended
to read as follows:
(b) A home-rule school district is subject to:
(1) a provision of this title establishing a criminal
offense;
(2) a provision of this title relating to limitations
on liability; and
(3) a prohibition, restriction, or requirement, as
applicable, imposed by this title or a rule adopted under this
title, relating to:
(A) the Public Education Information Management
System (PEIMS) to the extent necessary to monitor compliance with
this subchapter as determined by the commissioner;
(B) educator certification under Chapter 21 and
educator rights under Sections 21.407, 21.408, and 22.001;
(C) criminal history records under Subchapter C,
Chapter 22;
(D) student admissions under Section 25.001;
(E) school attendance under Sections 25.085,
25.086, and 25.087;
(F) inter-district or inter-county transfers of
students under Subchapter B, Chapter 25;
(G) elementary class size limits under Section
25.112, in the case of any campus in the district that fails to
satisfy any standard under Section 39.054(e);
(H) high school graduation under Section 28.025;
(I) special education programs under Subchapter
A, Chapter 29;
(J) bilingual education under Subchapter B,
Chapter 29;
(K) prekindergarten programs under Subchapter E,
Chapter 29;
(L) safety provisions relating to the
transportation of students under Sections 34.002, 34.003, 34.004,
and 34.008;
(M) computation and distribution of state aid
under Chapters 31, 42, and 43;
(N) extracurricular activities under Section
33.081;
(O) health and safety under Chapter 38;
(P) public school accountability under
Subchapters B, C, D, and J, Chapter 39, and Chapter 39A;
(Q) [equalized wealth under Chapter 41;
[(R)] a bond or other obligation or tax rate under
Chapters 42, 43, and 45; and
(R) [(S)] purchasing under Chapter 44.
SECTION 1.03. Section 12.029(b), Education Code, is amended
to read as follows:
(b) If [Except as provided by Subchapter H, Chapter 41, if]
two or more school districts having different status, one of which
is home-rule school district status, consolidate into a single
district, the petition under Section 13.003 initiating the
consolidation must state the status for the consolidated district.
The ballot shall be printed to permit voting for or against the
proposition: "Consolidation of (names of school districts) into a
single school district governed as (status of school district
specified in the petition)."
SECTION 1.04. Section 12.106(a), Education Code, is amended
to read as follows:
(a) A charter holder is entitled to receive for the
open-enrollment charter school funding under Chapter 42 equal to
the amount of funding per student in weighted average daily
attendance, excluding enrichment funding under Section 42.302(a),
to which the charter holder would be entitled for the school under
Chapter 42 if the school were a school district [without a tier one
local share for purposes of Section 42.253].
SECTION 1.05. Sections 13.054(f) and (i), Education Code,
are amended to read as follows:
(f) For five years beginning with the school year in which
the annexation occurs, a school district shall receive additional
funding as provided by Subchapter G [under this subsection or
Subsection (h). The amount of funding shall be determined by
multiplying the lesser of the enlarged district's local fund
assignment computed under Section 42.252 or the enlarged district's
total cost of tier one by a fraction, the numerator of which is the
number of students residing in the territory annexed to the
receiving district preceding the date of the annexation and the
denominator of which is the number of students residing in the
district as enlarged on the date of the annexation].
(i) The funding provided under Subsection (f) or [,] (g)[,
or (h)] is in addition to other funding the district receives
through other provisions of this code, including Chapter [Chapters
41 and] 42.
SECTION 1.06. Section 21.402(a), Education Code, is amended
to read as follows:
(a) Except as provided by Subsection (e-1) or (f), a school
district must pay each classroom teacher, full-time librarian,
full-time school counselor certified under Subchapter B, or
full-time school nurse not less than the minimum monthly salary,
based on the employee's level of experience in addition to other
factors, as determined by commissioner rule, determined by the
following formula:
MS = SF x FS
where:
"MS" is the minimum monthly salary;
"SF" is the applicable salary factor specified by Subsection
(c); and
"FS" is the amount, as determined by the commissioner under
Subsection (b), of the basic allotment as provided by Section
42.101(a) or (b) [for a school district with a maintenance and
operations tax rate at least equal to the state maximum compressed
tax rate, as defined by Section 42.101(a)].
SECTION 1.07. Section 21.410(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 1.08. Section 21.411(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 1.09. Section 21.412(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 1.10. Section 21.413(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 1.11. Section 25.081(f), Education Code, as added
by Chapter 851 (H.B. 2442), Acts of the 85th Legislature, Regular
Session, 2017, is amended to read as follows:
(f) The commissioner may proportionally reduce the amount
of funding a district receives under Chapter [41,] 42[,] or 46 and
the average daily attendance calculation for the district if the
district operates on a calendar that provides fewer minutes of
operation than required under Subsection (a).
SECTION 1.12. Section 29.008(b), Education Code, is amended
to read as follows:
(b) Except as provided by Subsection (c), costs of an
approved contract for residential placement may be paid from a
combination of federal and[,] state[, and local] funds. [The local
share of the total contract cost for each student is that portion of
the local tax effort that exceeds the district's local fund
assignment under Section 42.252, divided by the average daily
attendance in the district. If the contract involves a private
facility, the state share of the total contract cost is that amount
remaining after subtracting the local share. If the contract
involves a public facility, the state share is that amount
remaining after subtracting the local share from the portion of the
contract that involves the costs of instructional and related
services. For purposes of this subsection, "local tax effort"
means the total amount of money generated by taxes imposed for debt
service and maintenance and operation less any amounts paid into a
tax increment fund under Chapter 311, Tax Code.]
SECTION 1.13. Section 29.087(j), Education Code, is amended
to read as follows:
(j) For purposes of funding under Chapters [41,] 42[,] and
46, a student attending a program authorized by this section may be
counted in attendance only for the actual number of hours each
school day the student attends the program, in accordance with
Section 25.081.
SECTION 1.14. Section 29.203(b), Education Code, is amended
to read as follows:
(b) A school district is entitled to the allotment provided
by Section 42.157 for each eligible student using a public
education grant. A [If the district has a wealth per student
greater than the guaranteed wealth level but less than the
equalized wealth level, a] school district is entitled under rules
adopted by the commissioner to additional state aid in an amount
equal to the difference between the cost to the district of
providing services to a student using a public education grant and
the sum of the state aid received because of the allotment under
Section 42.157 and money from the available school fund
attributable to the student.
SECTION 1.15. Section 30.003(b), Education Code, is amended
to read as follows:
(b) If the student is admitted to the school for a full-time
program for the equivalent of two long semesters, the district's
share of the cost is an amount equal to the sum of the dollar amount
of enrichment [maintenance] and debt service taxes imposed by the
district for that year divided by the district's average daily
attendance for the preceding year and a dollar amount determined by
the commissioner.
SECTION 1.16. Section 37.0061, Education Code, is amended
to read as follows:
Sec. 37.0061. FUNDING FOR ALTERNATIVE EDUCATION SERVICES IN
JUVENILE RESIDENTIAL FACILITIES. A school district that provides
education services to pre-adjudicated and post-adjudicated
students who are confined by court order in a juvenile residential
facility operated by a juvenile board is entitled to count such
students in the district's average daily attendance for purposes of
receipt of state funds under the Foundation School Program. [If the
district has a wealth per student greater than the guaranteed
wealth level but less than the equalized wealth level, the district
in which the student is enrolled on the date a court orders the
student to be confined to a juvenile residential facility shall
transfer to the district providing education services an amount
equal to the difference between the average Foundation School
Program costs per student of the district providing education
services and the sum of the state aid and the money from the
available school fund received by the district that is attributable
to the student for the portion of the school year for which the
district provides education services to the student.]
SECTION 1.17. Section 42.009(b), Education Code, is amended
to read as follows:
(b) In making the determinations regarding funding levels
required by Subsection (a), the commissioner shall:
(1) make adjustments as necessary to reflect changes
in a school district's enrichment [maintenance and operations] tax
rate; and
(2) [for a district required to take action under
Chapter 41 to reduce its wealth per student to the equalized wealth
level, base the determinations on the district's net funding levels
after deducting any amounts required to be expended by the district
to comply with Chapter 41; and
[(3)] determine a district's weighted average daily
attendance in accordance with this chapter as it existed on January
1, 2011.
SECTION 1.18. Section 42.101(a), Education Code, is amended
to read as follows:
(a) For each student in average daily attendance, not
including the time students spend each day in special education
programs in an instructional arrangement other than mainstream or
career and technology education programs, for which an additional
allotment is made under Subchapter C, a district is entitled to an
allotment equal to [the lesser of] $4,765 [or the amount that
results from the following formula:
[A = $4,765 X (DCR/MCR)
[where:
["A" is the allotment to which a district is entitled;
["DCR" is the district's compressed tax rate, which is the
product of the state compression percentage, as determined under
Section 42.2516, multiplied by the maintenance and operations tax
rate adopted by the district for the 2005 tax year; and
["MCR" is the state maximum compressed tax rate, which is the
product of the state compression percentage, as determined under
Section 42.2516, multiplied by $1.50].
SECTION 1.19. Section 42.251(b), Education Code, is amended
to read as follows:
(b) The program shall be financed by:
(1) [ad valorem tax revenue generated by an equalized
uniform school district effort;
[(2)] ad valorem tax revenue generated by local school
district effort as provided by Subchapter F [in excess of the
equalized uniform school district effort];
(2) [(3)] state available school funds distributed in
accordance with law; and
(3) [(4)] state funds appropriated for the purposes of
public school education and allocated to each district in an amount
sufficient to finance the cost of each district's Foundation School
Program not covered by other funds specified in this subsection.
SECTION 1.20. Section 42.2511(b), Education Code, is
amended to read as follows:
(b) Notwithstanding any other provision of this chapter [or
Chapter 41], a school district subject to this section is entitled
to receive for each student in average daily attendance at the
campus described by Subsection (a) an amount equivalent to the
difference, if the difference results in increased funding,
between:
(1) the amount described by Section 12.106; and
(2) the amount to which the district would be entitled
under this chapter.
SECTION 1.21. Section 42.2521(a), Education Code, is
amended to read as follows:
(a) For purposes of Chapter [Chapters 41 and] 46 and this
chapter, and to the extent money specifically authorized to be used
under this section is available, the commissioner shall adjust the
taxable value of property in a school district that, due to factors
beyond the control of the board of trustees, experiences a rapid
decline in the tax base used in calculating taxable values in excess
of four percent of the tax base used in the preceding year.
SECTION 1.22. Section 42.2522(e), Education Code, is
amended to read as follows:
(e) The commissioner shall notify school districts as soon
as practicable as to the availability of funds under this section.
[For purposes of computing a rollback tax rate under Section 26.08,
Tax Code, a district shall adjust the district's tax rate limit to
reflect assistance received under this section.]
SECTION 1.23. Section 42.2523(a), Education Code, is
amended to read as follows:
(a) For purposes of Chapter [Chapters 41 and] 46 and this
chapter, the commissioner shall adjust the taxable value of
property of a school district all or part of which is located in an
area declared a disaster area by the governor under Chapter 418,
Government Code, as necessary to ensure that the district receives
funding based as soon as possible on property values as affected by
the disaster.
SECTION 1.24. Sections 42.2524(c) and (d), Education Code,
are amended to read as follows:
(c) The commissioner may provide reimbursement under this
section only if funds are available for that purpose from [as
follows]:
(1) [reimbursement for a school district not required
to take action under Chapter 41 may be provided from:
[(A)] amounts appropriated for that purpose,
including amounts appropriated for [those] districts to which this
section applies, [for that purpose] to the disaster contingency
fund established under Section 418.073, Government Code; or
(2) [(B)] Foundation School Program funds available
for that purpose, based on a determination by the commissioner that
the amount appropriated for the Foundation School Program,
including the facilities component as provided by Chapter 46,
exceeds the amount to which districts are entitled under this
chapter and Chapter 46[; and
[(2) reimbursement for a school district required to
take action under Chapter 41 may be provided from funds described by
Subdivision (1)(B) if funds remain available after fully
reimbursing each school district described by Subdivision (1) for
its disaster remediation costs].
(d) If the amount of money available for purposes of
reimbursing school districts [not required to take action under
Chapter 41] is not sufficient to fully reimburse each district's
disaster remediation costs, the commissioner shall reduce the
amount of assistance provided to each of those districts
proportionately. [If the amount of money available for purposes of
reimbursing school districts required to take action under Chapter
41 is not sufficient to fully reimburse each district's disaster
remediation costs, the commissioner shall reduce the amount of
assistance provided to each of those districts proportionately.]
SECTION 1.25. Sections 42.253(a), (c), and (h), Education
Code, are amended to read as follows:
(a) For each school year the commissioner shall determine:
(1) the amount of money to which a school district is
entitled under Subchapters B and C;
(2) the amount of money to which a school district is
entitled under Subchapter F;
(3) the amount of money allocated to the district from
the available school fund; and
(4) [the amount of each district's tier one local share
under Section 42.252; and
[(5)] the amount of each district's tier two local
share under Section 42.302.
(c) Each school district is entitled to an amount equal to
the difference for that district between the sum of Subsections
(a)(1) and (a)(2) and the sum of Subsections (a)(3) and[,] (a)(4)[,
and (a)(5)].
(h) If the amount appropriated for the Foundation School
Program for the second year of a state fiscal biennium is less than
the amount to which school districts and open-enrollment charter
schools are entitled for that year, the commissioner shall certify
the amount of the difference to the Legislative Budget Board not
later than January 1 of the second year of the state fiscal
biennium. The Legislative Budget Board shall propose to the
legislature that the certified amount be transferred to the
foundation school fund from the economic stabilization fund and
appropriated for the purpose of increases in allocations under this
subsection. If the legislature fails during the regular session to
enact the proposed transfer and appropriation and there are not
funds available under Subsection (j), the commissioner shall adjust
the total amounts due to each school district and open-enrollment
charter school under this chapter [and the total amounts necessary
for each school district to comply with the requirements of Chapter
41] by an amount determined by applying to each district and school
the same percentage adjustment to the total amount of state and
local revenue due to the district or school under this chapter [and
Chapter 41] so that the total amount of the adjustment to all
districts and schools results in an amount equal to the total
adjustment necessary. The following fiscal year,[:
[(1)] a district's or school's entitlement under this
section is increased by an amount equal to the adjustment made under
this subsection[; and
[(2) the amount necessary for a district to comply
with the requirements of Chapter 41 is reduced by an amount
necessary to ensure a district's full recovery of the adjustment
made under this subsection].
SECTION 1.26. Sections 42.2531(a), (b), and (c), Education
Code, are amended to read as follows:
(a) The commissioner may make adjustments to amounts due to
a school district under this chapter or Chapter 46, [or to amounts
necessary for a district to comply with the requirements of Chapter
41,] as provided by this section.
(b) A school district that has a major taxpayer, as
determined by the commissioner, that because of a protest of the
valuation of the taxpayer's property fails to pay all or a portion
of the ad valorem taxes due to the district may apply to the
commissioner to have the district's taxable value of property or ad
valorem tax collections adjusted for purposes of this chapter or
Chapter [41 or] 46. The commissioner may make the adjustment only
to the extent the commissioner determines that making the
adjustment will not:
(1) in the fiscal year in which the adjustment is made,
cause the amount to which school districts are entitled under this
chapter to exceed the amount appropriated for purposes of the
Foundation School Program for that year; and
(2) if the adjustment is made in the first year of a
state fiscal biennium, cause the amount to which school districts
are entitled under this chapter for the second year of the biennium
to exceed the amount appropriated for purposes of the Foundation
School Program for that year.
(c) The commissioner shall recover the benefit of any
adjustment made under this section by making offsetting adjustments
in the school district's taxable value of property or ad valorem tax
collections for purposes of this chapter or Chapter [41 or] 46 on a
final determination of the taxable value of property that was the
basis of the original adjustment, or in the second school year
following the year in which the adjustment is made, whichever is
earlier.
SECTION 1.27. Section 42.257(b), Education Code, is amended
to read as follows:
(b) If the district would have received a greater amount
from the foundation school fund for the applicable school year
using the adjusted value, the commissioner shall add the difference
to subsequent distributions to the district from the foundation
school fund. [An adjustment does not affect the local fund
assignment of any other district.]
SECTION 1.28. Section 42.258(a-1), Education Code, is
amended to read as follows:
(a-1) Notwithstanding Subsection (a), the agency may
recover an overallocation of state funds over a period not to exceed
the subsequent five school years if the commissioner determines
that the overallocation was the result of exceptional circumstances
reasonably caused by statutory changes to former Chapter 41,
Chapter [or] 46, or this chapter and related reporting
requirements.
SECTION 1.29. Section 42.259(a)(4), Education Code, is
amended to read as follows:
(4) "Wealth per student" means the taxable property
values reported by the comptroller under Section 5.09, Tax Code,
[to the commissioner under Section 42.252] divided by the number of
students in average daily attendance.
SECTION 1.30. Section 42.260(b), Education Code, is amended
to read as follows:
(b) The amount of additional funds to which each school
district or participating charter school is entitled due to the
increases in formula funding made by H.B. No. 3343, Acts of the 77th
Legislature, Regular Session, 2001, and any subsequent legislation
amending the provisions amended by that Act that increase formula
funding under [Chapter 41 and] this chapter to school districts and
charter schools is available for purposes of Subsection (c).
SECTION 1.31. Sections 42.302(a), (a-1), (a-2), (b), and
(d), Education Code, are amended to read as follows:
(a) Each school district is guaranteed a specified amount
per weighted student in state and local funds for each cent of tax
effort [over that required for the district's local fund
assignment] up to the maximum level specified in this subchapter.
The amount of state support, subject only to the maximum amount
under Section 42.303, is determined by the formula:
GYA = (GL X WADA X DTR X 100) - LR
where:
"GYA" is the guaranteed yield amount of state funds to be
allocated to the district;
"GL" is the dollar amount guaranteed level of state and local
funds per weighted student per cent of tax effort, which is an
amount described by Subsection (a-1) or a greater amount for any
year provided by appropriation;
"WADA" is the number of students in weighted average daily
attendance, which is calculated by dividing the sum of the school
district's allotments under Subchapters B and C, less any allotment
to the district for transportation, any allotment under Section
42.158 or 42.160, and 50 percent of the adjustment under Section
42.102, by the basic allotment for the applicable year;
"DTR" is the district enrichment tax rate of the school
district, which is determined by subtracting the amounts specified
by Subsection (b) from the total amount of enrichment [maintenance
and operations] taxes collected by the school district for the
applicable school year and dividing the difference by the quotient
of the district's taxable value of property as determined under
Subchapter M, Chapter 403, Government Code, or, if applicable,
under Section 42.2521, divided by 100; and
"LR" is the local revenue, which is determined by multiplying
"DTR" by the quotient of the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, under Section 42.2521, divided by 100.
(a-1) For purposes of Subsection (a), the dollar amount
guaranteed level of state and local funds per weighted student per
cent of tax effort ("GL") for a school district is:
(1) the greater of the amount of district tax revenue
per weighted student per cent of tax effort that would be available
to the Austin Independent School District, as determined by the
commissioner in cooperation with the Legislative Budget Board, if
the reduction of the limitation on tax increases as provided by
Section 11.26(a-1), (a-2), or (a-3), Tax Code, did not apply, or the
amount of district tax revenue per weighted student per cent of tax
effort used for purposes of this subdivision in the preceding
school year, for the first six cents of [by which] the district's
enrichment [maintenance and operations] tax rate [exceeds the rate
equal to the sum of the product of the state compression percentage,
as determined under Section 42.2516, multiplied by the maintenance
and operations tax rate adopted by the district for the 2005 tax
year and any additional tax effort included in calculating the
district's compressed tax rate under Section 42.101(a-1)]; and
(2) $31.95, for the district's enrichment [maintenance
and operations] tax effort that exceeds the amount of tax effort
described by Subdivision (1).
(a-2) The limitation on district enrichment tax rate
("DTR") under Section 42.303 does not apply to the district's
[maintenance and operations] tax effort described by Subsection
(a-1)(1).
(b) In computing the district enrichment tax rate of a
school district, the total amount of enrichment [maintenance and
operations] taxes collected by the school district does not include
the amount of[:
[(1) the district's local fund assignment under
Section 42.252; or
[(2)] taxes paid into a tax increment fund under
Chapter 311, Tax Code.
(d) For purposes of this section, the total amount of
enrichment [maintenance and operations] taxes collected for an
applicable school year by a school district with alternate tax
dates, as authorized by Section 26.135, Tax Code, is the amount of
enrichment taxes collected on or after January 1 of the year in
which the school year begins and not later than December 31 of the
same year.
SECTION 1.32. Section 42.303, Education Code, is amended to
read as follows:
Sec. 42.303. LIMITATION ON ENRICHMENT TAX RATE. The
district enrichment tax rate ("DTR") under Section 42.302 may not
exceed $0.17 [the amount] per $100 of valuation [by which the
maximum rate permitted under Section 45.003 exceeds the rate used
to determine the district's local share under Section 42.252, or a
greater amount for any year provided by appropriation].
SECTION 1.33. Section 44.004, Education Code, is amended by
amending Subsections (c), (c-1), and (i) and adding Subsections
(c-2) and (c-3) 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) enrichment [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 "Enrichment," ["Maintenance &
Operations,"] "Interest & Sinking Fund," and "Total," which is the
sum of "Enrichment" ["Maintenance & Operations"] and "Interest &
Sinking Fund":
(i) the school district's "Last Year's
Rate";
(ii) the "Rate to Maintain Same Level of
Enrichment [Maintenance & Operations] Revenue & Pay Debt Service,"
which:
(a) in the case of "Enrichment,"
["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 Subchapter F,
Chapter 42, would provide the same amount of enrichment
[maintenance and operations] taxes and state funds distributed
under Subchapter F, 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."; and
(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 enrichment [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.
(c-1) The notice described by Subsection (c) must state in a
distinct row or on a separate or individual line for each of the
following taxes:
(1) the proposed rate of the school district's
enrichment [maintenance] tax described by Section 45.003, under the
heading "Enrichment [Maintenance] Tax"; and
(2) if the school district has issued ad valorem tax
bonds under Section 45.001, the proposed rate of the tax to pay for
the bonds, under the heading "School Debt Service Tax Approved by
Local Voters."
(c-2) For the notice required by Subsection (c) for the 2021
tax year:
(1) the rows required by Subsection (c)(5) entitled
"Last Year's Rate" and the rows required by Subsection (c)(6)(A)
entitled "Last Year's Rate Versus Proposed Rate per $100 Value" and
"Taxes Due on Average Residence" and the item required by
Subsection (c)(6)(B) entitled "Increase (Decrease) in Taxes" must
contain an asterisk and a footnote to that section that, in reduced
type, states "The 86th Legislature eliminated certain school
district maintenance and operations taxes. The tax rate shown
as 'Last Year's Rate' and the 'Taxes Due on Average Residence' for
last year are based on the sum of the interest and sinking fund tax
rate adopted by the district for the 2020 tax year and the rate of
any tax the district imposed for enrichment for that tax year, not
the total tax rate."; and
(2) the computation required by Subsection (c)(6)(B)
shall be made using:
(A) for the 2020 tax year, the sum of the interest
and sinking fund tax rate adopted by the district for that tax year
and the rate of any tax the district imposed for enrichment for that
tax year; and
(B) for the 2021 tax year, the sum of the
district's proposed interest and sinking fund tax rate for that tax
year and the district's proposed enrichment tax rate for that tax
year.
(c-3) Subsection (c-2) and this subsection expire January
1, 2022.
(i) A school district that uses a certified estimate, as
authorized by Subsection (h), may adopt a budget at the public
meeting designated in the notice prepared using the estimate, but
the district may not adopt a tax rate before the district receives
the certified appraisal roll for the district required by Section
26.01(a), Tax Code. After receipt of the certified appraisal roll,
the district must publish a revised notice and hold another public
meeting before the district may adopt a tax rate that exceeds[:
[(1)] the rate proposed in the notice prepared using
the estimate[; or
[(2) the district's rollback rate determined under
Section 26.08, Tax Code, using the certified appraisal roll].
SECTION 1.34. The heading to Subchapter A, Chapter 45,
Education Code, is amended to read as follows:
SUBCHAPTER A. TAX BONDS AND ENRICHMENT [MAINTENANCE] TAXES
SECTION 1.35. Section 45.002, Education Code, is amended to
read as follows:
Sec. 45.002. ENRICHMENT [MAINTENANCE] TAXES. The governing
board of an independent school district, including the city council
or commission that has jurisdiction over a municipally controlled
independent school district, the governing board of a rural high
school district, and the commissioners court of a county, on behalf
of each common school district under its jurisdiction, may levy,
assess, and collect annual ad valorem taxes for the enrichment
[further maintenance] of public schools in the district, subject to
Section 45.003.
SECTION 1.36. Section 45.003, Education Code, is amended by
adding Subsections (a-1) and (a-2) and amending Subsection (d) to
read as follows:
(a-1) The governing board or commissioners court may levy
the tax described by Section 45.002 at a rate of $0.04 or less per
$100 of taxable value without an election.
(a-2) A governing board or commissioners court that, for the
2020 tax year, levied an enrichment tax at a rate in excess of $0.04
per $100 of taxable value may continue to levy the tax at a rate that
does not exceed that rate without an election.
(d) A proposition submitted to authorize the levy of
enrichment [maintenance] taxes must include the question of whether
the governing board or commissioners court may levy, assess, and
collect annual ad valorem taxes for the enrichment [further
maintenance] of public schools, at a rate not to exceed the rate
stated in the proposition. For any year, the enrichment
[maintenance] tax rate adopted by the district may not exceed $0.17
per $100 of taxable value [adopted by the district may not exceed
the rate equal to the sum of $0.17 and the product of the state
compression percentage, as determined under Section 42.2516,
multiplied by $1.50].
SECTION 1.37. Sections 45.006(b), (c), (d), (e), and (f),
Education Code, are amended to read as follows:
(b) A [Notwithstanding Section 45.003, a] school district
may levy, assess, and collect maintenance taxes [at a rate that
exceeds $1.50 per $100 valuation of taxable property] if:
(1) the [additional ad valorem] taxes are necessary to
pay a debt of the district that:
(A) resulted from the rendition of a judgment
against the district before May 1, 1995;
(B) is greater than $5 million;
(C) decreases a property owner's ad valorem tax
liability;
(D) requires the district to refund to the
property owner the difference between the amount of taxes paid by
the property owner and the amount of taxes for which the property
owner is liable; and
(E) is payable according to the judgment in more
than one of the district's fiscal years; and
(2) the [additional] taxes are:
(A) imposed at a rate that, when added to the rate
of any ad valorem tax imposed by the district under Section 45.002
or 45.007, produces a rate that does not exceed $0.17 per $100 of
taxable value; and
(B) approved by the voters of the district at an
election held for that purpose.
(c) Except as provided by Subsection (e), any [additional]
maintenance taxes that the district collects under this section may
be used only to pay the district's debt under Subsection (b)(1).
(d) Except as provided by Subsection (e), the authority of a
school district to levy the [additional] ad valorem taxes under
this section expires when the judgment against the district is
paid.
(e) The governing body of a school district shall pay the
district's debt under Subsection (b)(1) in a lump sum. To satisfy
the district's debt under Subsection (b)(1), the governing body may
levy and collect [additional] maintenance taxes as provided by
Subsection (b) and may issue bonds. If bonds are issued:
(1) the district may use any [additional] maintenance
taxes collected by the district under this section to pay debt
service on the bonds; and
(2) the authority of the district to levy the
[additional] ad valorem taxes expires when the bonds are paid in
full or the judgment is paid, whichever occurs later.
(f) The governing body of a school district that adopts a
tax rate under this section [that exceeds $1.50 per $100 valuation
of taxable property] may set the amount of the exemption from
taxation authorized by Section 11.13(n), Tax Code, at any time
before the date the governing body adopts the district's tax rate
for the tax year in which the election approving the [additional]
taxes is held.
SECTION 1.38. Subchapter A, Chapter 45, Education Code, is
amended by adding Section 45.007 to read as follows:
Sec. 45.007. AD VALOREM TAX FOR JUNIOR COLLEGE PURPOSES IN
CERTAIN SCHOOL DISTRICTS. (a) This section applies only to an
independent school district in a county with a population of more
than two million.
(b) Subject to Subsection (e), the governing body of an
independent school district that governs a junior college district
under Subchapter B, Chapter 130, may impose an ad valorem tax at a
rate not to exceed $0.05 on the $100 valuation of taxable property
in the district for the use of the junior college district for
facilities and equipment or for the maintenance and operating
expenses of the junior college district.
(c) All real property purchased with proceeds of a tax
imposed under this section or with funds dedicated under Section
45.105(e) as that section existed January 1, 2020, is the property
of the school district but is subject to the exclusive control of
the governing body of the junior college district for as long as the
junior college district uses the property for educational purposes.
(d) An independent school district that, under Section
45.105(e) as that section existed January 1, 2020, dedicated a
specific percentage of the school district's tax levy to the use of
a junior college district governed by the school district for
facilities and equipment or for the maintenance and operating
expenses of the junior college district is not required to hold an
election to impose a tax under this section.
(e) The tax authorized under this section may not be imposed
at a rate that, when added to the rate of any ad valorem tax imposed
by the district under Section 45.002 or 45.006, produces a rate that
exceeds $0.17 per $100 of taxable value.
SECTION 1.39. Section 45.104(a), Education Code, is amended
to read as follows:
(a) The board of trustees of any school district may pledge
its delinquent taxes levied for maintenance purposes for specific
past[, current, and future] school years or levied for enrichment
purposes for specific past, current, and future school years as
security for a loan, and may evidence any such loan with negotiable
notes, and the delinquent taxes pledged shall be applied against
the principal and interest of the loan. Negotiable notes issued
under this subsection must mature not more than 20 years from their
date.
SECTION 1.40. Section 45.108(a), Education Code, is amended
to read as follows:
(a) Independent or consolidated school districts may borrow
money for the purpose of paying maintenance expenses and may
evidence those loans with negotiable or nonnegotiable notes, except
that the loans may not at any time exceed 75 percent of the previous
year's income. The notes may be payable from and secured by a lien
on and pledge of any available funds of the district[, including
proceeds of a maintenance tax]. The term "maintenance expenses" or
"maintenance expenditures" as used in this section means any lawful
expenditure of the school district other than payment of principal
of and interest on bonds. The term includes expenditures relating
to notes issued to refund notes previously issued under this
section if the refunding notes are coterminous with the refunded
obligation. The term also includes all costs incurred in
connection with environmental cleanup and asbestos cleanup and
removal programs implemented by school districts or in connection
with the maintenance, repair, rehabilitation, or replacement of
heating, air conditioning, water, sanitation, roofing, flooring,
electric, or other building systems of existing school properties.
Notes issued pursuant to this section may be issued to mature in not
more than 20 years from their date. Notes issued for a term longer
than one year must be treated as "debt" as defined in Section
26.012(7), Tax Code.
SECTION 1.41. Section 45.109(c), Education Code, is amended
to read as follows:
(c) The consideration for a contract under this section may
be paid from any source available to the independent school
district. [If voted as provided by this section, the district may
pledge to the payment of the contract an annual maintenance tax in
an amount sufficient, without limitation, to provide all of the
consideration. If voted and pledged, the maintenance tax shall be
assessed, levied, and collected annually in the same manner as
provided by general law applicable to independent school districts
for other maintenance taxes.]
SECTION 1.42. Section 45.156(c), Education Code, is amended
to read as follows:
(c) The consideration payable by the district under a
contract may be paid from any source available to the district. [If
voted, the district may pledge to the payment of the contract an
annual maintenance tax in an amount sufficient, without limitation,
to provide all or part of the consideration. If voted and pledged,
the maintenance tax shall be assessed, levied, and collected
annually in the same manner as provided by general law applicable to
independent school districts for other maintenance taxes. A
maintenance tax may not be pledged to the payment of any contract or
assessed, levied, or collected unless an election is held in the
district, and the maintenance tax for that purpose is favorably
voted by a majority of the qualified voters of the district. The
election order for an election under this subsection must include
the polling place or places and any other matters considered
advisable by the board of trustees.]
SECTION 1.43. Section 45.251(2), Education Code, is amended
to read as follows:
(2) "Foundation School Program" means the program
established under Chapters [41,] 42[,] and 46, or any successor
program of state appropriated funding for school districts in this
state.
SECTION 1.44. Sections 45.261(a) and (e), Education Code,
are amended to read as follows:
(a) If the commissioner orders payment from the money
appropriated to the Foundation School Program on behalf of a school
district [that is not required to reduce its wealth per student
under Chapter 41], the commissioner shall direct the comptroller to
withhold the amount paid from the first state money payable to the
district. [If the commissioner orders payment from the money
appropriated to the Foundation School Program on behalf of a school
district that is required to reduce its wealth per student under
Chapter 41, the commissioner shall increase amounts due from the
district under that chapter in a total amount equal to the amount of
payments made on behalf of the district under this subchapter.]
Amounts withheld [or received] under this subsection shall be used
for the Foundation School Program.
(e) Any part of a school district's tax rate attributable to
producing revenue for purposes of Subsection (c)(1) is considered
part of the district's[:
[(1) current debt rate for purposes of computing a
rollback tax rate under Section 26.08, Tax Code; and
[(2)] interest and sinking fund tax rate.
SECTION 1.45. Section 46.003(d), Education Code, is amended
to read as follows:
(d) The amount budgeted by a district for payment of
eligible bonds may include:
(1) bond taxes collected in the current school year;
(2) bond taxes collected in a preceding school year in
excess of the amount necessary to pay the district's share of actual
debt service on bonds in that year, provided that the taxes were not
used to generate other state financial assistance for the district;
[or]
(3) enrichment [maintenance and operations] taxes
collected in the current school year or a preceding school year in
excess of the amount eligible to be used to generate other state
financial assistance for the district; or
(4) maintenance and operations taxes collected in a
preceding school year in excess of the amount eligible to be used to
generate other state financial assistance for the district.
SECTION 1.46. Section 46.004(a), Education Code, is amended
to read as follows:
(a) A district may receive state assistance in connection
with a lease-purchase agreement concerning an instructional
facility. For purposes of this subchapter:
(1) taxes levied for purposes of enrichment
[maintenance and operations] that are necessary to pay a district's
share of the payments under a lease-purchase agreement for which
the district receives state assistance under this subchapter are
considered to be bond taxes; and
(2) payments under a lease-purchase agreement are
considered to be payments of principal of and interest on bonds.
SECTION 1.47. Section 46.032(c), Education Code, is amended
to read as follows:
(c) The amount budgeted by a district for payment of
eligible bonds may include:
(1) bond taxes collected in the current school year;
(2) bond taxes collected in a preceding school year in
excess of the amount necessary to pay the district's share of actual
debt service on bonds in that year, provided that the taxes were not
used to generate other state financial assistance for the district;
[or]
(3) enrichment [maintenance and operations] taxes
collected in the current school year or a preceding school year in
excess of the amount eligible to be used to generate other state
financial assistance for the district; or
(4) maintenance and operations taxes collected in a
preceding school year in excess of the amount eligible to be used to
generate other state financial assistance for the district.
SECTION 1.48. Section 79.10(f), Education Code, is amended
to read as follows:
(f) For each student enrolled in the academy, the academy is
entitled to allotments from the foundation school fund under
Chapter 42 as if the academy were a school district [without a tier
one local share for purposes of Section 42.253]. If in any academic
year the amount of the allotments under this subsection exceeds the
amount of state funds paid to the academy in the first fiscal year
of the academy's operation, the commissioner of education shall set
aside from the total amount of funds to which school districts are
entitled under Section 42.253(c) an amount equal to the excess
amount and shall distribute that amount to the academy. After
deducting the amount set aside and paid to the academy by the
commissioner of education under this subsection, the commissioner
of education shall reduce the amount to which each district is
entitled under Section 42.253(c) in the manner described by Section
42.253(h). A determination of the commissioner of education under
this subsection is final and may not be appealed.
SECTION 1.49. Section 87.208, Education Code, is amended to
read as follows:
Sec. 87.208. SEABORNE CONSERVATION CORPS. If the board of
regents of The Texas A&M University System administers a program
that is substantially similar to the Seaborne Conservation Corps as
it was administered by the board during the 1998-1999 school year,
the program is entitled, for each student enrolled, to allotments
from the Foundation School Program under Chapter 42 as if the
program were a school district[, except that the program has a local
share applied that is equivalent to the local fund assignment of the
school district in which the principal facilities of the program
are located].
SECTION 1.50. Section 87.505(g), Education Code, is amended
to read as follows:
(g) For each student enrolled in the academy, the academy is
entitled to allotments from the foundation school fund under
Chapter 42 as if the academy were a school district [without a tier
one local share for purposes of Section 42.253]. If in any academic
year the amount of the allotments under this subsection exceeds the
amount of state funds paid to the academy in the first fiscal year
of the academy's operation, the commissioner of education shall set
aside from the total amount of funds to which school districts are
entitled under Section 42.253(c) an amount equal to the excess
amount and shall distribute that amount to the academy. After
deducting the amount set aside and paid to the academy by the
commissioner of education under this subsection, the commissioner
of education shall reduce the amount to which each district is
entitled under Section 42.253(c) in the manner described by Section
42.253(h). A determination of the commissioner of education under
this subsection is final and may not be appealed.
SECTION 1.51. Section 96.707(k), Education Code, is amended
to read as follows:
(k) For each student enrolled in the academy, the academy is
entitled to allotments from the Foundation School Program under
Chapter 42 as if the academy were a school district [without a tier
one local share for purposes of Section 42.253].
SECTION 1.52. Section 105.301(e), Education Code, is
amended to read as follows:
(e) The academy is not subject to the provisions of this
code, or to the rules of the Texas Education Agency, regulating
public schools, except that:
(1) professional employees of the academy are entitled
to the limited liability of an employee under Section 22.0511,
22.0512, or 22.052;
(2) a student's attendance at the academy satisfies
compulsory school attendance requirements; and
(3) for each student enrolled, the academy is entitled
to allotments from the foundation school program under Chapter 42
as if the academy were a school district [without a tier one local
share for purposes of Section 42.253].
SECTION 1.53. Section 4.008(a), Election Code, is amended
to read as follows:
(a) The [Except as provided by Subsection (b), the]
governing body of a political subdivision, other than a county,
that orders an election shall deliver notice of the election to the
county clerk and voter registrar of each county in which the
political subdivision is located not later than the 60th day before
election day.
SECTION 1.54. Section 403.302(a), Government Code, is
amended to read as follows:
(a) The comptroller shall conduct a study using comparable
sales and generally accepted auditing and sampling techniques to
determine the total taxable value of all property in each school
district. The study shall determine the taxable value of all
property and of each category of property in the district and the
productivity value of all land that qualifies for appraisal on the
basis of its productive capacity and for which the owner has applied
for and received a productivity appraisal. [The comptroller shall
make appropriate adjustments in the study to account for actions
taken under Chapter 41, Education Code.]
SECTION 1.55. Section 437.117(a), Government Code, is
amended to read as follows:
(a) For each student enrolled in the Texas ChalleNGe
Academy, the department is entitled to allotments from the
Foundation School Program under Chapter 42, Education Code, as if
the academy were a school district [without a tier one local share
for purposes of Section 42.253, Education Code].
SECTION 1.56. Section 1579.251(a), Insurance Code, is
amended to read as follows:
(a) The state shall assist employees of participating
school districts and charter schools in the purchase of group
health coverage under this chapter by providing for each covered
employee the amount of $900 each state fiscal year or a greater
amount as provided by the General Appropriations Act. The state
contribution shall be distributed through the school finance
formulas under Chapter [Chapters 41 and] 42, Education Code, and
used by school districts and charter schools as provided by Section
42.260, Education Code.
SECTION 1.57. Section 21.01, Tax Code, is amended to read as
follows:
Sec. 21.01. REAL PROPERTY. Real property is taxable by a
taxing unit if located in the unit on January 1[, except as provided
by Chapter 41, Education Code].
SECTION 1.58. Section 21.02(a), Tax Code, is amended to
read as follows:
(a) Except as provided by Subsection [Subsections (b) and]
(e) and by Sections 21.021, 21.04, and 21.05, tangible personal
property is taxable by a taxing unit if:
(1) it is located in the unit on January 1 for more
than a temporary period;
(2) it normally is located in the unit, even though it
is outside the unit on January 1, if it is outside the unit only
temporarily;
(3) it normally is returned to the unit between uses
elsewhere and is not located in any one place for more than a
temporary period; or
(4) the owner resides (for property not used for
business purposes) or maintains the owner's principal place of
business in this state (for property used for business purposes) in
the unit and the property is taxable in this state but does not have
a taxable situs pursuant to Subdivisions (1) through (3) [of this
subsection].
SECTION 1.59. Section 26.012, Tax Code, is amended by
amending Subdivisions (4) and (9) and adding Subdivision (8-a) to
read as follows:
(4) "Current debt rate" means a rate expressed in
dollars per $100 of taxable value and calculated according to the
following formula:
CURRENT DEBT RATE = [[](CURRENT DEBT SERVICE - EXCESS
COLLECTIONS) / (CURRENT TOTAL VALUE X COLLECTION RATE)[] + CURRENT
JUNIOR COLLEGE LEVY / CURRENT TOTAL VALUE]
(8-a) "Effective enrichment rate" means, for a school
district, a rate expressed in dollars per $100 of taxable value and
calculated according to the following formula:
EFFECTIVE ENRICHMENT RATE = (LAST YEAR'S LEVY - LAST YEAR'S DEBT
LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
(9) "Effective maintenance and operations rate"
means, for a taxing unit other than a school district, a rate
expressed in dollars per $100 of taxable value and calculated
according to the following formula:
EFFECTIVE MAINTENANCE AND OPERATIONS RATE = (LAST YEAR'S LEVY -
LAST YEAR'S DEBT LEVY [- LAST YEAR'S JUNIOR COLLEGE LEVY]) /
(CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
SECTION 1.60. Section 26.04, Tax Code, is amended by
amending Subsections (c) and (e-1) and adding Subsection (c-1) to
read as follows:
(c) An officer or employee designated by the governing body
of a taxing unit other than a school district shall calculate the
effective tax rate and the rollback tax rate for the unit, where:
(1) "Effective tax rate" means a rate expressed in
dollars per $100 of taxable value calculated according to the
following formula:
EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY
LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
; and
(2) "Rollback tax rate" means a rate expressed in
dollars per $100 of taxable value calculated according to the
following formula:
ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND OPERATIONS RATE x
1.08) + CURRENT DEBT RATE
(c-1) An officer or employee designated by the governing
body of a school district shall calculate the effective tax rate for
the school district. For purposes of this subsection, "effective
tax rate" has the meaning assigned by Subsection (c)(1).
(e-1) Subsections (e), (i), and (j) [The notice
requirements imposed by Subsections (e)(1)-(6)] do not apply to a
school district.
SECTION 1.61. Section 26.05, Tax Code, is amended by
amending Subsections (a), (b), and (g) and adding Subsection (b-1)
to read as follows:
(a) The governing body of each taxing unit, before the later
of September 30 or the 60th day after the date the certified
appraisal roll is received by the taxing unit, shall adopt a tax
rate for the current tax year and shall notify the assessor for the
unit of the rate adopted. The tax rate consists of two components,
each of which must be approved separately. The components are:
(1) for a taxing unit other than a school district, the
rate that, if applied to the total taxable value, will impose the
total amount published under Section 26.04(e)(3)(C), less any
amount of additional sales and use tax revenue that will be used to
pay debt service, or, for a school district, the rate calculated
under Section 44.004(c)(5)(A)(ii)(b), Education Code; and
(2) for a taxing unit other than a school district, the
rate that, if applied to the total taxable value, will impose the
amount of taxes needed to fund maintenance and operation
expenditures of the unit for the next year, or, for a school
district, the rate that, if applied to total taxable value, will
impose the amount of taxes needed to fund the enrichment
expenditures of the school district for the next year.
(b) A taxing unit may not impose property taxes in any year
until the governing body has adopted a tax rate for that year, and
the annual tax rate must be set by ordinance, resolution, or order,
depending on the method prescribed by law for adoption of a law by
the governing body. The vote on the ordinance, resolution, or
order setting the tax rate must be separate from the vote adopting
the budget. For a taxing unit other than a school district, the
vote on the ordinance, resolution, or order setting a tax rate that
exceeds the effective tax rate must be a record vote, and at least
60 percent of the members of the governing body must vote in favor
of the ordinance, resolution, or order. For a school district, the
vote on the ordinance, resolution, or order setting a tax rate that
exceeds the sum of the effective enrichment [maintenance and
operations tax] rate of the district [as determined under Section
26.08(i)] and the district's current debt rate must be a record
vote, and at least 60 percent of the members of the governing body
must vote in favor of the ordinance, resolution, or order. A
motion to adopt an ordinance, resolution, or order setting a tax
rate that exceeds the effective tax rate must be made in the
following form: "I move that the property tax rate be increased by
the adoption of a tax rate of (specify tax rate), which is
effectively a (insert percentage by which the proposed tax rate
exceeds the effective tax rate) percent increase in the tax
rate."
(b-1) If the ordinance, resolution, or order adopted by a
governing body under Subsection (b) sets a tax rate that, if applied
to the total taxable value, will impose an amount of taxes to fund
the maintenance and operation expenditures or, in the case of a
school district, the enrichment expenditures of the taxing unit
that exceeds the amount of taxes imposed for that purpose in the
preceding year, the taxing unit must:
(1) include in the ordinance, resolution, or order in
type larger than the type used in any other portion of the document:
(A) the following statement: "THIS TAX RATE
WILL RAISE MORE TAXES FOR (Insert MAINTENANCE AND OPERATIONS or
ENRICHMENT, as applicable) THAN LAST YEAR'S TAX RATE."; and
(B) if the tax rate exceeds the effective
maintenance and operations rate or the effective enrichment rate,
as applicable, the following statement: "THE TAX RATE WILL
EFFECTIVELY BE RAISED BY (INSERT PERCENTAGE BY WHICH THE TAX RATE
EXCEEDS THE EFFECTIVE MAINTENANCE AND OPERATIONS RATE OR EFFECTIVE
ENRICHMENT RATE, AS APPLICABLE) PERCENT AND WILL RAISE TAXES [FOR
MAINTENANCE AND OPERATIONS] ON A $100,000 HOME BY APPROXIMATELY
$(Insert amount)."; and
(2) include on the home page of any Internet website
operated by the unit:
(A) the following statement: "(Insert name of
unit) ADOPTED A TAX RATE THAT WILL RAISE MORE TAXES FOR (Insert
MAINTENANCE AND OPERATIONS or ENRICHMENT, as applicable) THAN LAST
YEAR'S TAX RATE"; and
(B) if the tax rate exceeds the effective
maintenance and operations rate or the effective enrichment rate,
as applicable, the following statement: "THE TAX RATE WILL
EFFECTIVELY BE RAISED BY (INSERT PERCENTAGE BY WHICH THE TAX RATE
EXCEEDS THE EFFECTIVE MAINTENANCE AND OPERATIONS RATE OR EFFECTIVE
ENRICHMENT RATE, AS APPLICABLE) PERCENT AND WILL RAISE TAXES [FOR
MAINTENANCE AND OPERATIONS] ON A $100,000 HOME BY APPROXIMATELY
$(Insert amount)."
(g) Notwithstanding Subsection (a), the governing body of a
school district that elects to adopt a tax rate before the adoption
of a budget for the fiscal year that begins in the current tax year
may adopt a tax rate for the current tax year before receipt of the
certified appraisal roll for the school district if the chief
appraiser of the appraisal district in which the school district
participates has certified to the assessor for the school district
an estimate of the taxable value of property in the school district
as provided by Section 26.01(e). If a school district adopts a tax
rate under this subsection, the effective tax rate [and the
rollback tax rate] of the district shall be calculated based on the
certified estimate of taxable value.
SECTION 1.62. Sections 26.16(a) and (d), Tax Code, are
amended to read as follows:
(a) The county assessor-collector for each county that
maintains an Internet website shall post on the website of the
county the following applicable information for the most recent
five tax years [beginning with the 2012 tax year] for each taxing
unit all or part of the territory of which is located in the county:
(1) the adopted tax rate;
(2) the maintenance and operations rate;
(3) the enrichment rate;
(4) the debt rate;
(5) [(4)] the effective tax rate;
(6) [(5)] the effective maintenance and operations
rate;
(7) the effective enrichment rate; and
(8) [(6)] the rollback tax rate.
(d) The county assessor-collector shall post immediately
below the table prescribed by Subsection (c) the following
statement:
"The county is providing this table of property tax rate
information as a service to the residents of the county. Each
individual taxing unit is responsible for calculating the property
tax rates listed in this table pertaining to that taxing unit and
providing that information to the county.
"The adopted tax rate is the tax rate adopted by the governing
body of a taxing unit.
"The maintenance and operations rate is the component of the
adopted tax rate of a taxing unit other than a school district that
will impose the amount of taxes needed to fund maintenance and
operation expenditures of the unit for the following year.
"The enrichment rate is the component of the adopted tax rate
of a school district that will impose the amount of taxes needed to
fund enrichment expenditures of the school district for the
following year.
"The debt rate is the component of the adopted tax rate of a
taxing unit that will impose the amount of taxes needed to fund the
unit's debt service for the following year.
"The effective tax rate is the tax rate that would generate
the same amount of revenue in the current tax year as was generated
by a taxing unit's adopted tax rate in the preceding tax year from
property that is taxable in both the current tax year and the
preceding tax year.
"The effective maintenance and operations rate is the tax
rate that, if adopted by a taxing unit other than a school district
in the current tax year, would generate the same amount of revenue
for maintenance and operations in the current tax year as was
generated by the [a] taxing unit's maintenance and operations rate
in the preceding tax year from property that is taxable in both the
current tax year and the preceding tax year.
"The effective enrichment rate is the tax rate that, if
adopted by a school district in the current tax year, would generate
the same amount of revenue for enrichment expenditures in the
current tax year as was generated by the school district's
enrichment rate in the preceding tax year from property that is
taxable in both the current tax year and the preceding tax year.
"The rollback tax rate is the highest tax rate a taxing unit
other than a school district may adopt before requiring voter
approval at an election. The [In the case of a taxing unit other
than a school district, the] voters by petition may require that a
rollback election be held if a taxing unit other than a school
district [the unit] adopts a tax rate in excess of the taxing unit's
rollback tax rate. [In the case of a school district, an election
will automatically be held if the district wishes to adopt a tax
rate in excess of the district's rollback tax rate.]"
SECTION 1.63. Section 31.01, Tax Code, is amended by
amending Subsection (d-1) and adding Subsection (d-2) to read as
follows:
(d-1) This subsection applies only to a school
district. In addition to stating the total tax rate for the school
district, the tax bill or the separate statement shall separately
state:
(1) the enrichment [maintenance and operations] rate
of the school district;
(2) if the school district has outstanding debt, as
defined by Section 26.012, the debt rate of the district;
(3) the enrichment [maintenance and operations] rate
of the school district for the preceding tax year;
(4) if for the current tax year the school district
imposed taxes for debt, as defined by Section 26.012, the debt rate
of the district for the current tax year;
(5) if for the preceding tax year the school district
imposed taxes for debt, as defined by Section 26.012, the debt rate
of the district for that year; and
(6) the total tax rate of the district for the
preceding tax year.
(d-2) For the 2021 tax year, the "total tax rate of the
district for the preceding tax year" as required by Subsection
(d-1)(6) shall be computed by adding the district's debt rate for
the 2020 tax year and the rate of any tax the district imposed for
enrichment in the 2020 tax year. This subsection expires January 1,
2022.
SECTION 1.64. Section 312.210(b), Tax Code, is amended to
read as follows:
(b) A tax abatement agreement with the owner of real
property or tangible personal property that is located in the
reinvestment zone described by Subsection (a) [and in a school
district that has a wealth per student that does not exceed the
equalized wealth level] must exempt from taxation:
(1) the portion of the value of the property in the
amount specified in the joint agreement among the municipality,
county, and junior college district; and
(2) an amount equal to 10 percent of the maximum
portion of the value of the property that may under Section
312.204(a) be otherwise exempted from taxation.
SECTION 1.65. The following provisions are repealed:
(1) Section 7.055(b)(34), Education Code;
(2) Section 8.056, Education Code;
(3) Section 13.054(h), Education Code;
(4) Section 29.203(g), Education Code;
(5) Chapter 41, Education Code;
(6) Sections 42.101(a-1) and (c), Education Code;
(7) Section 42.158(e), Education Code;
(8) Section 42.160(b), Education Code;
(9) Sections 42.2516, 42.2518, and 42.252, Education
Code;
(10) Section 42.2524(f), Education Code;
(11) Section 42.2528(b), Education Code;
(12) Section 42.262, Education Code;
(13) Section 42.302(f), Education Code;
(14) Section 45.003(f), Education Code;
(15) Section 45.105(e), Education Code;
(16) Section 45.109(d), Education Code;
(17) Section 45.111(b), Education Code;
(18) Section 3.005(d), Election Code;
(19) Section 4.008(b), Election Code;
(20) Sections 825.405(h) and (i), Government Code;
(21) Sections 21.02(b) and (c), Tax Code;
(22) Section 25.25(k), Tax Code;
(23) Sections 26.012(5) and (12), Tax Code;
(24) Sections 26.08 and 26.085, Tax Code; and
(25) Section 312.210(c), Tax Code.
SECTION 1.66. (a) This article takes effect January 1,
2021.
(b) Chapter 42, Education Code, as amended by this article,
applies beginning with the 2021-2022 school year.
(c) To the extent of any conflict, the repeal by this
article of Section 8.056, Education Code, prevails over another Act
of the 86th Legislature, Regular Session, 2019, relating to the
continuation of regional education service centers.
(d) The repeal by this article of Chapter 41, Education
Code, does not affect the obligations of a school district under
that chapter, as it existed before repeal by this article, for the
2020-2021 school year.
(e) This article does not affect ad valorem taxes imposed
before the effective date of this article, and the law in effect
before the effective date of this article is continued in effect for
purposes of the liability for and collection of those taxes and
penalties and interest on those taxes.
ARTICLE 2. STATE FUNDING FOR PUBLIC EDUCATION
SECTION 2.01. Section 151.051(b), Tax Code, is amended to
read as follows:
(b) The sales tax rate is 12 [6-1/4] percent of the sales
price of the taxable item sold.
SECTION 2.02. Section 151.801, Tax Code, is amended by
amending Subsection (a) and adding Subsection (b-1) to read as
follows:
(a) Except for the amounts allocated under Subsections (b),
(b-1), (c), and (c-2), all proceeds from the collection of the taxes
imposed by this chapter shall be deposited to the credit of the
general revenue fund.
(b-1) Notwithstanding any other provision of this section,
an amount of revenue under this chapter equal to the proceeds, other
than the proceeds allocated under Subsection (b), derived from the
collection of taxes imposed by this chapter attributable to the
portion of the tax rate in excess of 6.25 percent of the sales price
of the taxable item sold shall be deposited to the credit of the
foundation school fund.
SECTION 2.03. Section 152.021(b), Tax Code, is amended to
read as follows:
(b) The tax rate is 12 [6-1/4] percent of the total
consideration.
SECTION 2.04. Section 152.022(b), Tax Code, is amended to
read as follows:
(b) The tax rate is 12 [6-1/4] percent of the total
consideration.
SECTION 2.05. Section 152.023(b-1), Tax Code, is amended to
read as follows:
(b-1) The tax on a motor vehicle eligible to be issued
exhibition vehicle specialty license plates under Section 504.502,
Transportation Code, is equal to the lesser of $90 or 12 [6.25]
percent of the total consideration.
SECTION 2.06. Section 152.026(b), Tax Code, is amended to
read as follows:
(b) The tax rate is 19 [10] percent of the gross rental
receipts from the rental of a rented motor vehicle for 30 days or
less and 12 [6-1/4] percent of the gross rental receipts from the
rental of a rented motor vehicle for longer than 30 days.
SECTION 2.07. Section 152.028(b), Tax Code, is amended to
read as follows:
(b) The tax rate is 12 [6-1/4] percent of the total
consideration.
SECTION 2.08. Section 152.122, Tax Code, is amended to read
as follows:
Sec. 152.122. ALLOCATION OF TAX. (a) The comptroller shall
deposit the funds received under Section 152.121 [of this code as
follows:
[(1) 1/4 to the credit of the foundation school fund;
and
[(2) the remaining funds] to the credit of the general
revenue fund.
(b) Notwithstanding Subsection (a), the comptroller shall
deposit to the credit of the foundation school fund an amount equal
to the amount of money that is:
(1) received by the comptroller under Sections
152.043, 152.044, 152.045, 152.046, 152.047, and 152.121;
(2) derived from the taxes imposed under Sections
152.021, 152.022, 152.023, 152.026, and 152.028; and
(3) attributable to an increase in the rate of a tax
described by Subdivision (2) effective October 1, 2020.
SECTION 2.09. The heading to Section 152.1222, Tax Code, is
amended to read as follows:
Sec. 152.1222. ALLOCATION OF CERTAIN TAX REVENUE TO
FOUNDATION SCHOOL [PROPERTY TAX RELIEF] FUND.
SECTION 2.10. Section 152.1222(a), Tax Code, is amended to
read as follows:
(a) Notwithstanding Section 152.122, the comptroller shall
deposit to the credit of the foundation school fund [property tax
relief fund under Section 403.109, Government Code,] the amount of
money received under Section 152.121 that is estimated to have been
derived from the computation of the tax imposed by this chapter on
the standard presumptive values of motor vehicles or on percentages
of those values as provided by Section 152.0412.
SECTION 2.11. Section 154.6035, Tax Code, is amended to
read as follows:
Sec. 154.6035. ALLOCATION OF CERTAIN REVENUE TO FOUNDATION
SCHOOL [PROPERTY TAX RELIEF] FUND. Notwithstanding Section
154.603, all proceeds from the collection of taxes imposed by this
chapter attributable to the portion of the tax rate in excess of
$20.50 per thousand on cigarettes, regardless of weight, shall be
deposited to the credit of the foundation school fund [property tax
relief fund under Section 403.109, Government Code].
SECTION 2.12. The heading to Section 155.2415, Tax Code, is
amended to read as follows:
Sec. 155.2415. ALLOCATION OF CERTAIN REVENUE TO FOUNDATION
SCHOOL [PROPERTY TAX RELIEF] FUND AND CERTAIN OTHER FUNDS.
SECTION 2.13. Section 155.2415(a), Tax Code, is amended to
read as follows:
(a) Notwithstanding Section 155.241, the proceeds from the
collection of taxes imposed by Section 155.0211 shall be allocated
as follows:
(1) the amount of the proceeds that is equal to the
amount that, if the taxes imposed by Section 155.0211 were imposed
at a rate of 40 percent of the manufacturer's list price, exclusive
of any trade discount, special discount, or deal, would be
attributable to the portion of that tax rate in excess of 35.213
percent, shall be deposited to the credit of the foundation school
fund [property tax relief fund under Section 403.109, Government
Code];
(2) the amount of the proceeds that is equal to the
amount that would be attributable to a tax rate of 35.213 percent of
the manufacturer's list price, exclusive of any trade discount,
special discount, or deal, if the taxes were imposed by Section
155.0211 at that rate, shall be deposited to the credit of the
general revenue fund; and
(3) [100 percent of] the remaining proceeds shall be
deposited to the credit of:
(A) the physician education loan repayment
program account established under Subchapter J, Chapter 61,
Education Code; or
(B) the general revenue fund, if the comptroller
determines that the unencumbered beginning balance of the physician
education loan repayment account established under Subchapter J,
Chapter 61, Education Code, is sufficient to fund appropriations
and other direct and indirect costs from that account for the
fulfillment of existing and expected physician loan repayment
commitments during the current state fiscal biennium.
SECTION 2.14. The heading to Section 171.4011, Tax Code, is
amended to read as follows:
Sec. 171.4011. ALLOCATION OF CERTAIN REVENUE TO FOUNDATION
SCHOOL [PROPERTY TAX RELIEF] FUND.
SECTION 2.15. Section 171.4011(a), Tax Code, is amended to
read as follows:
(a) Notwithstanding Section 171.401, [beginning with the
state fiscal year that begins September 1, 2007,] the comptroller
shall, for each state fiscal year, deposit to the credit of the
foundation school fund [property tax relief fund under Section
403.109, Government Code,] an amount of revenue calculated by:
(1) determining the revenue derived from the tax
imposed by this chapter as it applied during that [applicable]
state fiscal year; and
(2) subtracting the revenue the comptroller estimates
that the tax imposed by this chapter, as it existed on August 31,
2007, would have generated if it had been in effect for that
[applicable] state fiscal year.
SECTION 2.16. The following provisions are repealed:
(1) Section 403.109, Government Code; and
(2) Section 171.664, Tax Code.
SECTION 2.17. (a) This article takes effect October 1,
2020.
(b) On October 1, 2020, the property tax relief fund is
abolished and the unencumbered balance of that fund is transferred
to the foundation school fund.
(c) In addition to the substantive changes made by this
article, this article conforms Section 152.122, Tax Code, to the
method of allocating motor vehicle sales and use taxes in effect
before the effective date of this article. Section 11.04, Chapter 4
(S.B. 3), Acts of the 72nd Legislature, 1st Called Session, 1991,
enacted former Section 403.094(h), Government Code, which
abolished certain state fund dedications and resulted in the
abolition of the allocation to the foundation school fund effective
August 31, 1995.
(d) The changes in law made by this article do not affect tax
liability accruing before the effective date of this article. That
liability continues in effect as if this article had not been
enacted, and the former law is continued in effect for the
collection of taxes due and for civil and criminal enforcement of
the liability for those taxes.