Texas Senate Bill SB1791

Texas 2019 - 86th Regular

Caption

Relating to the authority of the governing body of a taxing unit in a county in which home prices are appreciating rapidly to adopt a limitation on increases in the appraised value for purposes of ad valorem taxation by the taxing unit of residence homesteads in certain low-income areas.

Impact

The bill proposes to amend existing provisions in the Tax Code, thereby altering the appraisal framework for residences in qualifying census tracts identified by economically distressed metrics. For example, areas where the median family income is below 60% of the area median or where poverty rates exceed 25% could qualify under this legislation. Should local governments opt to enact such limitations, it could significantly affect the ad valorem taxation structure in these communities, promoting stability in housing costs for residents.

Summary

Senate Bill 1791 seeks to address the challenges posed by rapidly appreciating home prices in Texas by providing local taxing units, in designated low-income areas, with the authority to limit the increases in appraised values of residence homesteads for ad valorem tax purposes. Specifically, it enables the governing bodies of these taxing units to implement a cap on the appraisal value appreciation, ensuring that property taxes do not escalate excessively, thereby aiding families that may be economically vulnerable amid rising housing costs.

Contention

During discussions surrounding SB 1791, notable points of contention emerged regarding its potential ramifications on local tax revenues. Supporters argue that the measure would provide much-needed relief to low-income homeowners, while critics express concern over the implications for overall funding for local services that rely heavily on property tax revenues. The debate highlights the delicate balance between ensuring affordable housing and maintaining adequate funding for public services prevalent in rapidly appreciating markets.