Texas 2021 - 87th 1st C.S.

Texas House Bill HB70 Compare Versions

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1	1	87S10209 CJC-D
2	2	By: Schofield H.B. No. 70
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the establishment of a limitation on the total amount of
8	8	ad valorem taxes that taxing units may impose on the residence
9	9	homesteads of individuals who are disabled or elderly and their
10	10	surviving spouses.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. The heading to Section 11.26, Tax Code, is
13	13	amended to read as follows:
14	14	Sec. 11.26. LIMITATION OF TAXES [SCHOOL TAX] ON HOMESTEADS
15	15	OF INDIVIDUALS WHO ARE ELDERLY OR DISABLED.
16	16	SECTION 2. Sections 11.26(a), (a-1), (a-2), (a-3), (b),
17	17	(c), (e), (g), (h), (i), (i-1), (j), (k), and (o), Tax Code, are
18	18	amended to read as follows:
19	19	(a) The tax officials shall appraise [the] property to which
20	20	this section applies and calculate taxes as on other property, but
21	21	if the tax [so] calculated exceeds the limitation imposed by this
22	22	section, the tax imposed is the amount of the tax as limited by this
23	23	section, except as otherwise provided by this section. A taxing
24	24	unit [school district] may not increase the total annual amount of
25	25	ad valorem tax it imposes on the residence homestead of an
26	26	individual 65 years of age or older or on the residence homestead of
27	27	an individual who is disabled, as defined by Section 11.13, above
28	28	the amount of the tax it imposed in the first tax year in which the
29	29	individual qualified that residence homestead for the applicable
30	30	exemption provided by Section 11.13(c) for an individual who is 65
31	31	years of age or older or is disabled. If the individual qualified
32	32	that residence homestead for the exemption after the beginning of
33	33	that first year and the residence homestead remains eligible for
34	34	the same exemption for the next year, and if the [school district]
35	35	taxes imposed by a taxing unit on the residence homestead in the
36	36	next year are less than the amount of those taxes imposed in that
37	37	first year, the taxing unit [a school district] may not
38	38	subsequently increase the total annual amount of ad valorem taxes
39	39	it imposes on the residence homestead above the amount it imposed in
40	40	the year immediately following the first year for which the
41	41	individual qualified that residence homestead for the same
42	42	exemption, except as provided by Subsection (b). [If the first tax
43	43	year the individual qualified the residence homestead for the
44	44	exemption provided by Section 11.13(c) for individuals 65 years of
45	45	age or older or disabled was a tax year before the 2015 tax year, the
46	46	amount of the limitation provided by this section is the amount of
47	47	tax the school district imposed for the 2014 tax year less an amount
48	48	equal to the amount determined by multiplying $10,000 times the tax
49	49	rate of the school district for the 2015 tax year, plus any 2015 tax
50	50	attributable to improvements made in 2014, other than improvements
51	51	made to comply with governmental regulations or repairs.]
52	52	(a-1) If the first tax year the individual qualified the
53	53	residence homestead for the exemption provided by Section 11.13(c)
54	54	for individuals 65 years of age or older or disabled was a tax year
55	55	before the 2022 tax year, the amount of the limitation on school
56	56	district taxes provided by this section is the amount of those taxes
57	57	imposed for the 2021 tax year plus any 2022 tax attributable to
58	58	improvements made in 2021, other than improvements made to comply
59	59	with governmental regulations or repairs [Notwithstanding the
60	60	other provisions of this section, if in the 2007 tax year an
61	61	individual qualifies for a limitation on tax increases provided by
62	62	this section on the individual's residence homestead and the first
63	63	tax year the individual or the individual's spouse qualified for an
64	64	exemption under Section 11.13(c) for the same homestead was the
65	65	2006 tax year, the amount of the limitation provided by this section
66	66	on the homestead in the 2007 tax year is equal to the amount
67	67	computed by:
68	68	[(1) multiplying the amount of tax the school district
69	69	imposed on the homestead in the 2006 tax year by a fraction the
70	70	numerator of which is the tax rate of the district for the 2007 tax
71	71	year and the denominator of which is the tax rate of the district
72	72	for the 2006 tax year; and
73	73	[(2) adding any tax imposed in the 2007 tax year
74	74	attributable to improvements made in the 2006 tax year as provided
75	75	by Subsection (b) to the lesser of the amount computed under
76	76	Subdivision (1) or the amount of tax the district imposed on the
77	77	homestead in the 2006 tax year].
78	78	(a-2) If the first tax year the individual qualified the
79	79	residence homestead for the exemption provided by Section 11.13(c)
80	80	for individuals 65 years of age or older or disabled was a tax year
81	81	before the 2022 tax year and the homestead qualified for a
82	82	limitation on county, municipal, or junior college district taxes
83	83	under former Section 11.261, the amount of the limitation on
84	84	county, municipal, or junior college district taxes, as applicable,
85	85	provided by this section is the amount of the tax imposed by the
86	86	applicable taxing unit for the 2021 tax year, plus any 2022 tax
87	87	attributable to improvements made in 2021, other than improvements
88	88	made to comply with governmental regulations or repairs
89	89	[Notwithstanding the other provisions of this section, if in the
90	90	2007 tax year an individual qualifies for a limitation on tax
91	91	increases provided by this section on the individual's residence
92	92	homestead and the first tax year the individual or the individual's
93	93	spouse qualified for an exemption under Section 11.13(c) for the
94	94	same homestead was a tax year before the 2006 tax year, the amount
95	95	of the limitation provided by this section on the homestead in the
96	96	2007 tax year is equal to the amount computed by:
97	97	[(1) multiplying the amount of tax the school district
98	98	imposed on the homestead in the 2005 tax year by a fraction the
99	99	numerator of which is the tax rate of the district for the 2006 tax
100	100	year and the denominator of which is the tax rate of the district
101	101	for the 2005 tax year;
102	102	[(2) adding any tax imposed in the 2006 tax year
103	103	attributable to improvements made in the 2005 tax year as provided
104	104	by Subsection (b) to the lesser of the amount computed under
105	105	Subdivision (1) or the amount of tax the district imposed on the
106	106	homestead in the 2005 tax year;
107	107	[(3) multiplying the amount computed under
108	108	Subdivision (2) by a fraction the numerator of which is the tax rate
109	109	of the district for the 2007 tax year and the denominator of which
110	110	is the tax rate of the district for the 2006 tax year; and
111	111	[(4) adding to the lesser of the amount computed under
112	112	Subdivision (2) or (3) any tax imposed in the 2007 tax year
113	113	attributable to improvements made in the 2006 tax year, as provided
114	114	by Subsection (b)].
115	115	(a-3) Except as provided by Subsection (a-2), for the
116	116	purpose of calculating a limitation on tax increases by a taxing
117	117	unit other than a school district under this section, an individual
118	118	who qualified a residence homestead before January 1, 2022, for an
119	119	exemption under Section 11.13(c) for individuals 65 years of age or
120	120	older or disabled is considered to have qualified the homestead for
121	121	that exemption on January 1, 2022 [(b), a limitation on tax
122	122	increases provided by this section on a residence homestead
123	123	computed under Subsection (a-1) or (a-2) continues to apply to the
124	124	homestead in subsequent tax years until the limitation expires].
125	125	(b) If an individual makes improvements to the individual's
126	126	residence homestead, other than improvements required to comply
127	127	with governmental requirements or repairs, a taxing unit [the
128	128	school district] may increase the tax on the homestead in the first
129	129	year the value of the homestead is increased on the appraisal roll
130	130	because of the enhancement of value by the improvements. The amount
131	131	of the tax increase is determined by applying the taxing unit's
132	132	current tax rate to the difference in the assessed value of the
133	133	homestead with the improvements and the assessed value it would
134	134	have had without the improvements. A limitation under [imposed by]
135	135	this section [then] applies to the increased amount of tax in
136	136	subsequent tax years until more improvements, if any, are made.
137	137	(c) The limitation on tax increases required by this section
138	138	expires if on January 1:
139	139	(1) none of the owners of the structure who qualify for
140	140	the exemption under Section 11.13(c) for individuals 65 years of
141	141	age or older or disabled and who owned the structure when the
142	142	limitation first took effect is using the structure as a residence
143	143	homestead; or
144	144	(2) none of the owners of the structure qualifies for
145	145	the exemption described by Subdivision (1).
146	146	(e) For each school district participating in an appraisal
147	147	district, the chief appraiser shall determine the portion of the
148	148	appraised value of residence homesteads of individuals on which
149	149	school district taxes are not imposed in a tax year because of the
150	150	limitation on tax increases imposed by this section. That portion
151	151	is calculated by determining the taxable value that, if multiplied
152	152	by the tax rate adopted by the school district for the tax year,
153	153	would produce an amount equal to the amount of tax that would have
154	154	been imposed by the school district on those residence homesteads
155	155	if the limitation on tax increases imposed by this section were not
156	156	in effect, but that was not imposed because of that limitation. The
157	157	chief appraiser shall determine that taxable value and certify it
158	158	to the comptroller as soon as practicable for each tax year.
159	159	(g) Except as provided by Subsection (b), if an individual
160	160	who receives a limitation on tax increases imposed by this section,
161	161	including a surviving spouse who receives a limitation under
162	162	Subsection (i), subsequently qualifies a different residence
163	163	homestead for the same exemption under Section 11.13, a taxing unit
164	164	[school district] may not impose ad valorem taxes on the
165	165	subsequently qualified homestead in a year in an amount that
166	166	exceeds the amount of taxes the taxing unit [school district] would
167	167	have imposed on the subsequently qualified homestead in the first
168	168	year in which the individual receives that same exemption for the
169	169	subsequently qualified homestead had the limitation on tax
170	170	increases imposed by this section not been in effect, multiplied by
171	171	a fraction the numerator of which is the total amount of [school
172	172	district] taxes imposed by a taxing unit of the same type on the
173	173	former homestead in the last year in which the individual received
174	174	that same exemption for the former homestead and the denominator of
175	175	which is the total amount of [school district] taxes that would have
176	176	been imposed by the taxing unit of the same type on the former
177	177	homestead in the last year in which the individual received that
178	178	same exemption for the former homestead had the limitation on tax
179	179	increases imposed by this section not been in effect. A limitation
180	180	under this subsection does not apply to a taxing unit if the former
181	181	homestead was not subject to taxation by a taxing unit of the same
182	182	type in the last year in which the individual received the exemption
183	183	for the former homestead.
184	184	(h) An individual who receives a limitation on tax increases
185	185	under this section, including a surviving spouse who receives a
186	186	limitation under Subsection (i), and who subsequently qualifies a
187	187	different residence homestead for an exemption under Section 11.13,
188	188	or an agent of the individual, is entitled to receive from the chief
189	189	appraiser of the appraisal district in which the former homestead
190	190	was located a written certificate providing the information
191	191	necessary to determine whether the individual may qualify for that
192	192	same limitation on the subsequently qualified homestead under
193	193	Subsection (g) and to calculate the amount of taxes the taxing units
194	194	[school district] may impose on the subsequently qualified
195	195	homestead.
196	196	(i) If an individual who qualifies for the exemption
197	197	provided by Section 11.13(c) for individuals 65 years of age or
198	198	older or disabled dies, the surviving spouse of the individual is
199	199	entitled to the limitation applicable to the residence homestead of
200	200	the individual if:
201	201	(1) the surviving spouse is 55 years of age or older or
202	202	disabled when the individual dies; and
203	203	(2) the residence homestead of the individual:
204	204	(A) is the residence homestead of the surviving
205	205	spouse on the date that the individual dies; and
206	206	(B) remains the residence homestead of the
207	207	surviving spouse.
208	208	(i-1) A limitation on school district taxes under
209	209	Subsection (i) applicable to the residence homestead of the
210	210	surviving spouse of an individual who was disabled and who died
211	211	before January 1, 2020, is calculated as if the surviving spouse was
212	212	entitled to the limitation when the individual died.
213	213	(j) If an individual who qualifies for an exemption provided
214	214	by Section 11.13(c) for an individual 65 years of age or older dies
215	215	in the first year in which the individual qualified for the
216	216	exemption and the individual first qualified for the exemption
217	217	after the beginning of that year, except as provided by Subsection
218	218	(k), the amount to which the surviving spouse's [school district]
219	219	taxes imposed by a taxing unit are limited under Subsection (i) is
220	220	the amount of [school district] taxes imposed by the taxing unit on
221	221	the residence homestead in that year determined as if the
222	222	individual qualifying for the exemption had lived for the entire
223	223	year.
224	224	(k) If in the first tax year after the year in which an
225	225	individual dies in the circumstances described by Subsection (j)
226	226	the amount of [school district] taxes imposed by a taxing unit on
227	227	the residence homestead of the surviving spouse is less than the
228	228	amount of [school district] taxes imposed by the taxing unit in the
229	229	preceding year as limited by Subsection (j), in a subsequent tax
230	230	year the [surviving spouse's school district] taxes imposed by that
231	231	taxing unit on that residence homestead are limited to the amount of
232	232	taxes imposed by the district in that first tax year after the year
233	233	in which the individual dies.
234	234	(o) Notwithstanding Subsections (a)[, (a-3),] and (b), an
235	235	improvement to property that would otherwise constitute an
236	236	improvement under Subsection (b) is not treated as an improvement
237	237	under that subsection if the improvement is a replacement structure
238	238	for a structure that was rendered uninhabitable or unusable by a
239	239	casualty or by wind or water damage. For purposes of appraising the
240	240	property in the tax year in which the structure would have
241	241	constituted an improvement under Subsection (b), the replacement
242	242	structure is considered to be an improvement under that subsection
243	243	only if:
244	244	(1) the square footage of the replacement structure
245	245	exceeds that of the replaced structure as that structure existed
246	246	before the casualty or damage occurred; or
247	247	(2) the exterior of the replacement structure is of
248	248	higher quality construction and composition than that of the
249	249	replaced structure.
250	250	SECTION 3. Sections 23.19(b) and (g), Tax Code, are amended
251	251	to read as follows:
252	252	(b) If an appraisal district receives a written request for
253	253	the appraisal of real property and improvements of a cooperative
254	254	housing corporation according to the separate interests of the
255	255	corporation's stockholders, the chief appraiser shall separately
256	256	appraise the interests described by Subsection (d) if the
257	257	conditions required by Subsections (e) and (f) have been met.
258	258	Separate appraisal under this section is for the purposes of
259	259	administration of tax exemptions, determination of applicable
260	260	limitations of taxes under Section 11.26 [or 11.261], and
261	261	apportionment by a cooperative housing corporation of property
262	262	taxes among its stockholders but is not the basis for determining
263	263	value on which a tax is imposed under this title. A stockholder
264	264	whose interest is separately appraised under this section may
265	265	protest and appeal the appraised value in the manner provided by
266	266	this title for protest and appeal of the appraised value of other
267	267	property.
268	268	(g) A tax bill or a separate statement accompanying the tax
269	269	bill to a cooperative housing corporation for which interests of
270	270	stockholders are separately appraised under this section must
271	271	state, in addition to the information required by Section 31.01,
272	272	the appraised value and taxable value of each interest separately
273	273	appraised. Each exemption claimed as provided by this title by a
274	274	person entitled to the exemption shall also be deducted from the
275	275	total appraised value of the property of the corporation. The total
276	276	tax imposed by a taxing unit [school district, county,
277	277	municipality, or junior college district] shall be reduced by any
278	278	amount that represents an increase in taxes attributable to
279	279	separately appraised interests of the real property and
280	280	improvements that are subject to a [the] limitation of taxes
281	281	prescribed by Section 11.26 [or 11.261]. The corporation shall
282	282	apportion among its stockholders liability for reimbursing the
283	283	corporation for property taxes according to the relative taxable
284	284	values of their interests.
285	285	SECTION 4. Sections 26.012(6), (13), and (14), Tax Code,
286	286	are amended to read as follows:
287	287	(6) "Current total value" means the total taxable
288	288	value of property listed on the appraisal roll for the current year,
289	289	including all appraisal roll supplements and corrections as of the
290	290	date of the calculation, less the taxable value of property
291	291	exempted for the current tax year for the first time under Section
292	292	11.31 or 11.315, except that:
293	293	(A) the current total value for a school district
294	294	excludes:
295	295	(i) the total value of homesteads that
296	296	qualify for a tax limitation as provided by Section 11.26; and
297	297	(ii) new property value of property that is
298	298	subject to an agreement entered into under Chapter 313; and
299	299	(B) the current total value for a taxing unit
300	300	other than a school district [county, municipality, or junior
301	301	college district] excludes the total value of homesteads that
302	302	qualify for a tax limitation provided by Section 11.26 [11.261].
303	303	(13) "Last year's levy" means the total of:
304	304	(A) the amount of taxes that would be generated
305	305	by multiplying the total tax rate adopted by the governing body in
306	306	the preceding year by the total taxable value of property on the
307	307	appraisal roll for the preceding year, including:
308	308	(i) taxable value that was reduced in an
309	309	appeal under Chapter 42;
310	310	(ii) all appraisal roll supplements and
311	311	corrections other than corrections made pursuant to Section
312	312	25.25(d), as of the date of the calculation but excluding[, except
313	313	that last year's taxable value for a school district excludes] the
314	314	total value of homesteads that qualified for a tax limitation as
315	315	provided by Section 11.26 [and last year's taxable value for a
316	316	county, municipality, or junior college district excludes the total
317	317	value of homesteads that qualified for a tax limitation as provided
318	318	by Section 11.261]; and
319	319	(iii) the portion of taxable value of
320	320	property that is the subject of an appeal under Chapter 42 on July
321	321	25 that is not in dispute; and
322	322	(B) the amount of taxes refunded by the taxing
323	323	unit in the preceding year for tax years before that year.
324	324	(14) "Last year's total value" means the total taxable
325	325	value of property listed on the appraisal roll for the preceding
326	326	year, including all appraisal roll supplements and corrections,
327	327	other than corrections made pursuant to Section 25.25(d), as of the
328	328	date of the calculation but excluding[, except that:
329	329	[(A) last year's taxable value for a school
330	330	district excludes] the total value of homesteads that qualified for
331	331	a tax limitation as provided by Section 11.26[; and
332	332	[(B) last year's taxable value for a county,
333	333	municipality, or junior college district excludes the total value
334	334	of homesteads that qualified for a tax limitation as provided by
335	335	Section 11.261].
336	336	SECTION 5. The following provisions of the Tax Code are
337	337	repealed:
338	338	(1) Sections 11.26(l) and (m); and
339	339	(2) Section 11.261.
340	340	SECTION 6. Section 11.26, Tax Code, as amended by this Act,
341	341	applies only to ad valorem taxes imposed for a tax year beginning on
342	342	or after the effective date of this Act.
343	343	SECTION 7. This Act takes effect January 1, 2022, but only
344	344	if the constitutional amendment proposed by the 87th Legislature,
345	345	1st Called Session, 2021, establishing a limitation on the total
346	346	amount of ad valorem taxes that political subdivisions may impose
347	347	on the residence homesteads of individuals who are disabled or
348	348	elderly and their surviving spouses is approved by the voters. If
349	349	that constitutional amendment is not approved by the voters, this
350	350	Act has no effect.