86R3205 SMT-F
By: Shine H.B. No. 492
A BILL TO BE ENTITLED
AN ACT
relating to a temporary local option exemption from ad valorem
taxation of a portion of the appraised value of certain property
damaged by a 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 11.35 to read as follows:
Sec. 11.35. TEMPORARY EXEMPTION FOR QUALIFIED PROPERTY
DAMAGED BY DISASTER. (a) In this section, "qualified property"
means property that:
(1) consists of:
(A) tangible personal property used for the
production of income; or
(B) an improvement to real property;
(2) is located in an area declared by the governor to
be a disaster area following a disaster;
(3) is at least 15 percent damaged by the disaster, as
determined by the chief appraiser under this section; and
(4) for property described by Subdivision (1)(A), is
the subject of a rendition statement or property report filed by the
property owner under Section 22.01 that demonstrates that the
property had taxable situs in the disaster area for the tax year in
which the disaster occurred.
(b) A person is entitled to an exemption from taxation by a
taxing unit of a portion of the appraised value of qualified
property that the person owns if the exemption is adopted by the
governing body of the taxing unit in the manner provided by law for
official action by the body.
(c) An exemption adopted by the governing body of a taxing
unit under this section must:
(1) specify the disaster to which the exemption
pertains; and
(2) be adopted not later than the 60th day after the
date the governor first declares territory in the taxing unit to be
a disaster area as a result of the disaster.
(d) A taxing unit the governing body of which adopts an
exemption under this section shall, not later than the seventh day
after the date the governing body adopts the exemption, notify the
chief appraiser of each appraisal district in which the taxing unit
participates, the assessor for the taxing unit, and the comptroller
of the adoption of the exemption.
(e) On receipt of an application for the exemption
authorized by this section, the chief appraiser shall determine
whether any item of qualified property that is the subject of the
application is at least 15 percent damaged by the disaster and
assign to each such item of qualified property a damage assessment
rating of Level I, Level II, Level III, or Level IV, as appropriate,
as provided by Subsection (f). In determining the appropriate
damage assessment rating, the chief appraiser may rely on
information provided by a county emergency management authority,
the Federal Emergency Management Agency, or any other source the
chief appraiser considers appropriate.
(f) The chief appraiser shall assign to an item of qualified
property:
(1) a Level I damage assessment rating if the property
is at least 15 percent, but less than 30 percent, damaged, meaning
that the property suffered minimal damage and may continue to be
used as intended;
(2) a Level II damage assessment rating if the
property is at least 30 percent, but less than 60 percent, damaged,
which, for qualified property described by Subsection (a)(1)(B),
means that the property has suffered only nonstructural damage,
including nonstructural damage to the roof, walls, foundation, or
mechanical components, and the waterline, if any, is less than 18
inches above the floor;
(3) a Level III damage assessment rating if the
property is at least 60 percent damaged but is not a total loss,
which, for qualified property described by Subsection (a)(1)(B),
means that the property has suffered significant structural damage
requiring extensive repair due to the failure or partial failure of
structural elements, wall elements, or the foundation, or the
waterline is at least 18 inches above the floor; or
(4) a Level IV damage assessment rating if the
property is a total loss, meaning that repair of the property is not
feasible.
(g) Subject to Subsection (h), the amount of the exemption
authorized by this section for an item of qualified property is
determined by multiplying the appraised value, determined for the
tax year in which the disaster occurred, of the property by:
(1) 15 percent, if the property is assigned a Level I
damage assessment rating;
(2) 30 percent, if the property is assigned a Level II
damage assessment rating;
(3) 60 percent, if the property is assigned a Level III
damage assessment rating; or
(4) 100 percent, if the property is assigned a Level IV
damage assessment rating.
(h) If a person qualifies for the exemption authorized by
this section after the beginning of the tax year, the amount of the
exemption is calculated by multiplying the amount determined under
Subsection (g) by a fraction, the denominator of which is 365 and
the numerator of which is the number of days remaining in the tax
year after the day on which the governor first declares the area in
which the person's qualified property is located to be a disaster
area, including the day on which the governor makes the
declaration.
(i) If a person qualifies for the exemption authorized by
this section after the amount of the tax due on the qualified
property is calculated and the effect of the qualification is to
reduce the amount of the tax due on the property, the assessor for
each taxing unit that has adopted the exemption shall recalculate
the amount of the tax due on the property and correct the tax roll.
If the tax bill has been mailed and the tax on the property has not
been paid, the assessor shall mail a corrected tax bill to the
person in whose name the property is listed on the tax roll or to the
person's authorized agent. If the tax on the property 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. No interest is due on an amount refunded under this
subsection.
(j) The exemption authorized by this section expires as to
an item of qualified property on January 1 of the first tax year in
which the property is reappraised under Section 25.18.
SECTION 2. Section 11.42(e), Tax Code, is amended to read as
follows:
(e) A person who qualifies for an exemption under Section
11.131 or 11.35 after January 1 of a tax year may receive the
exemption for the applicable portion of that tax year immediately
on qualification for the exemption.
SECTION 3. Section 11.43, Tax Code, is amended by amending
Subsection (c) and adding Subsection (s) to read as follows:
(c) An exemption provided by Section 11.13, 11.131, 11.132,
11.133, 11.134, 11.17, 11.18, 11.182, 11.1827, 11.183, 11.19,
11.20, 11.21, 11.22, 11.23(a), (h), (j), (j-1), or (m), 11.231,
11.254, 11.27, 11.271, 11.29, 11.30, 11.31, [or] 11.315, or 11.35,
once allowed, need not be claimed in subsequent years, and except as
otherwise provided by Subsection (e), the exemption applies to the
property until it changes ownership or the person's qualification
for the exemption changes. However, except as provided by
Subsection (r), the chief appraiser may require a person allowed
one of the exemptions in a prior year to file a new application to
confirm the person's current qualification for the exemption by
delivering a written notice that a new application is required,
accompanied by an appropriate application form, to the person
previously allowed the exemption. If the person previously allowed
the exemption is 65 years of age or older, the chief appraiser may
not cancel the exemption due to the person's failure to file the new
application unless the chief appraiser complies with the
requirements of Subsection (q), if applicable.
(s) A person who qualifies for an exemption under Section
11.35 must apply for the exemption not later than the 45th day after
the date the governing body of the taxing unit adopts the exemption,
provided that the chief appraiser may extend the deadline for good
cause shown.
SECTION 4. Section 11.45, Tax Code, is amended by adding
Subsection (e) to read as follows:
(e) If the chief appraiser approves, modifies, or denies an
application for an exemption under Section 11.35, the chief
appraiser shall deliver a written notice of the approval,
modification, or denial to the applicant not later than the fifth
day after the date the chief appraiser makes the determination. The
notice must include the damage assessment rating assigned by the
chief appraiser to each item of qualified property that is the
subject of the application and a brief explanation of the
procedures for protesting the chief appraiser's determination. The
notice required under this subsection is in lieu of any notice that
would otherwise be required under Subsection (d).
SECTION 5. Section 26.012(15), Tax Code, is amended to read
as follows:
(15) "Lost property levy" means the amount of taxes
levied in the preceding year on property value that was taxable in
the preceding year but is not taxable in the current year because
the property is exempt in the current year under a provision of this
code other than Section 11.251, [or] 11.253, or 11.35, the property
has qualified for special appraisal under Chapter 23 in the current
year, or the property is located in territory that has ceased to be
a part of the taxing unit since the preceding year.
SECTION 6. Section 41.03(a), Tax Code, is amended to read as
follows:
(a) A taxing unit is entitled to challenge before the
appraisal review board:
(1) the level of appraisals of any category of
property in the district or in any territory in the district, but
not the appraised value of a single taxpayer's property;
(2) an exclusion of property from the appraisal
records;
(3) a grant in whole or in part of a partial exemption,
other than an exemption under Section 11.35;
(4) a determination that land qualifies for appraisal
as provided by Subchapter C, D, E, or H, Chapter 23; or
(5) a failure to identify the taxing unit as one in
which a particular property is taxable.
SECTION 7. Section 41.41, Tax Code, is amended by adding
Subsection (c) to read as follows:
(c) Notwithstanding Subsection (a), a property owner is
entitled to protest before the appraisal review board only the
following actions of the chief appraiser in relation to an
exemption under Section 11.35:
(1) the modification or denial of an application for
an exemption under that section; or
(2) the determination of the appropriate damage
assessment rating for an item of qualified property under that
section.
SECTION 8. Section 41.44(a), Tax Code, is amended to read as
follows:
(a) Except as provided by Subsections (b), (c), (c-1), and
(c-2), to be entitled to a hearing and determination of a protest,
the property owner initiating the protest must file a written
notice of the protest with the appraisal review board having
authority to hear the matter protested:
(1) not later than May 15 or the 30th day after the
date that notice to the property owner was delivered to the property
owner as provided by Section 25.19, whichever is later;
(2) in the case of a protest of a change in the
appraisal records ordered as provided by Subchapter A of this
chapter or by Chapter 25, not later than the 30th day after the date
notice of the change is delivered to the property owner;
(3) in the case of a determination that a change in the
use of land appraised under Subchapter C, D, E, or H, Chapter 23,
has occurred, not later than the 30th day after the date the notice
of the determination is delivered to the property owner; [or]
(4) in the case of a determination of eligibility for a
refund under Section 23.1243, not later than the 30th day after the
date the notice of the determination is delivered to the property
owner; or
(5) in the case of a protest of the modification or
denial of an application for an exemption under Section 11.35, or
the determination of an appropriate damage assessment rating for an
item of qualified property under that section, not later than the
30th day after the date the property owner receives the notice
required under Section 11.45(e).
SECTION 9. 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, 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; and
(14) the total dollar amount of any exemptions granted
under Section 11.35, Tax Code.
SECTION 10. Section 23.02, Tax Code, is repealed.
SECTION 11. Section 11.35, Tax Code, as added by this Act,
applies only to ad valorem taxes imposed for a tax year that begins
on or after the effective date of this Act.
SECTION 12. This Act takes effect January 1, 2020, but only
if the constitutional amendment proposed by the 86th Legislature,
Regular Session, 2019, authorizing the legislature to provide for a
temporary local option exemption from ad valorem taxation of a
portion of the appraised value of certain property damaged by a
disaster is approved by the voters. If that amendment is not
approved by the voters, this Act has no effect.