Texas 2021 - 87th 2nd C.S.

Texas House Bill HB109 Compare Versions

Only one version of the bill is available at this time.

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1	1	By: Vasut H.B. No. 109
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to a limitation on increases in the appraised value of real
7	7	property for ad valorem tax purposes.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Section 1.12(d), Tax Code, is amended to read as
10	10	follows:
11	11	(d) For purposes of this section, the appraisal ratio of
12	12	real property [a homestead] to which Section 23.23 applies is the
13	13	ratio of the property's market value as determined by the appraisal
14	14	district or appraisal review board, as applicable, to the market
15	15	value of the property according to law. The appraisal ratio is not
16	16	calculated according to the appraised value of the property as
17	17	limited by Section 23.23.
18	18	SECTION 2. The heading to Section 23.23, Tax Code, is
19	19	amended to read as follows:
20	20	Sec. 23.23. LIMITATION ON APPRAISED VALUE OF REAL PROPERTY
21	21	[RESIDENCE HOMESTEAD].
22	22	SECTION 3. Section 23.23, Tax Code, is amended by amending
23	23	Subsections (a), (b), (c), and (e) and adding Subsections (c-1),
24	24	(c-2), and (c-3) to read as follows:
25	25	(a) Notwithstanding the requirements of Section 25.18 and
26	26	regardless of whether the appraisal office has appraised the
27	27	property and determined the market value of the property for the tax
28	28	year, an appraisal office may increase the appraised value of real
29	29	property [a residence homestead] for a tax year to an amount not to
30	30	exceed the lesser of:
31	31	(1) the market value of the property for the most
32	32	recent tax year that the market value was determined by the
33	33	appraisal office; or
34	34	(2) the sum of:
35	35	(A) 3.5 [10] percent of the appraised value of
36	36	the property for the preceding tax year;
37	37	(B) the appraised value of the property for the
38	38	preceding tax year; and
39	39	(C) the market value of all new improvements to
40	40	the property.
41	41	(b) When appraising real property [a residence homestead],
42	42	the chief appraiser shall:
43	43	(1) appraise the property at its market value; and
44	44	(2) include in the appraisal records both the market
45	45	value of the property and the amount computed under Subsection
46	46	(a)(2).
47	47	(c) The limitation provided by Subsection (a) takes effect
48	48	on January 1 of the tax year following the first tax year in which
49	49	the owner owns the property on January 1 or, if the property
50	50	qualifies as the [to a] residence homestead of the owner under
51	51	Section 11.13 in the tax year in which the owner acquires the
52	52	property, the limitation takes effect on January 1 of the tax year
53	53	following that [the first] tax year [the owner qualifies the
54	54	property for an exemption under Section 11.13]. Except as provided
55	55	by Subsection (c-1) or (c-2), the [The] limitation expires on
56	56	January 1 of the first tax year following the year in which [that
57	57	neither] the owner of the property ceases to own the property.
58	58	(c-1) If property subject to a limitation under this section
59	59	qualifies for an exemption under Section 11.13 when the ownership
60	60	of the property is transferred to the owner's spouse or surviving
61	61	spouse, the limitation expires on January 1 of the first tax year
62	62	following the year in which [when the limitation took effect nor]
63	63	the owner's spouse or surviving spouse ceases to own the property,
64	64	unless the limitation is further continued under this subsection on
65	65	the subsequent transfer to a spouse or surviving spouse [qualifies
66	66	for an exemption under Section 11.13].
67	67	(c-2) If property subject to a limitation under Subsection
68	68	(a), other than a residence homestead, is owned by two or more
69	69	persons, the limitation expires on January 1 of the first tax year
70	70	following the year in which the ownership of at least a 50 percent
71	71	interest in the property is sold or otherwise transferred.
72	72	(c-3) For purposes of applying the limitation provided by
73	73	this section in the first tax year after the 2021 tax year in which
74	74	the property is appraised for taxation:
75	75	(1) the property is considered to have been appraised
76	76	for taxation in the 2021 tax year at a market value equal to the
77	77	appraised value of the property for that tax year;
78	78	(2) a person who acquired real property in a tax year
79	79	before the 2021 tax year is considered to have acquired the property
80	80	on January 1, 2021; and
81	81	(3) a person who qualified the property for an
82	82	exemption under Section 11.13 as the person's residence homestead
83	83	for any portion of the 2021 tax year is considered to have acquired
84	84	the property in the 2021 tax year.
85	85	(e) In this section, "new improvement" means an improvement
86	86	to real property [a residence homestead] made after the most recent
87	87	appraisal of the property that increases the market value of the
88	88	property and the value of which is not included in the appraised
89	89	value of the property for the preceding tax year. The term does not
90	90	include repairs to or ordinary maintenance of an existing structure
91	91	or the grounds or another feature of the property.
92	92	SECTION 4. Section 42.26(d), Tax Code, is amended to read as
93	93	follows:
94	94	(d) For purposes of this section, the value of the property
95	95	subject to the suit and the value of a comparable property or sample
96	96	property that is used for comparison must be the market value
97	97	determined by the appraisal district when the property is [a
98	98	residence homestead] subject to the limitation on appraised value
99	99	imposed by Section 23.23.
100	100	SECTION 5. Sections 403.302(d) and (i), Government Code,
101	101	are amended to read as follows:
102	102	(d) For the purposes of this section, "taxable value" means
103	103	the market value of all taxable property less:
104	104	(1) the total dollar amount of any residence homestead
105	105	exemptions lawfully granted under Section 11.13(b) or (c), Tax
106	106	Code, in the year that is the subject of the study for each school
107	107	district;
108	108	(2) one-half of the total dollar amount of any
109	109	residence homestead exemptions granted under Section 11.13(n), Tax
110	110	Code, in the year that is the subject of the study for each school
111	111	district;
112	112	(3) the total dollar amount of any exemptions granted
113	113	before May 31, 1993, within a reinvestment zone under agreements
114	114	authorized by Chapter 312, Tax Code;
115	115	(4) subject to Subsection (e), the total dollar amount
116	116	of any captured appraised value of property that:
117	117	(A) is within a reinvestment zone created on or
118	118	before May 31, 1999, or is proposed to be included within the
119	119	boundaries of a reinvestment zone as the boundaries of the zone and
120	120	the proposed portion of tax increment paid into the tax increment
121	121	fund by a school district are described in a written notification
122	122	provided by the municipality or the board of directors of the zone
123	123	to the governing bodies of the other taxing units in the manner
124	124	provided by former Section 311.003(e), Tax Code, before May 31,
125	125	1999, and within the boundaries of the zone as those boundaries
126	126	existed on September 1, 1999, including subsequent improvements to
127	127	the property regardless of when made;
128	128	(B) generates taxes paid into a tax increment
129	129	fund created under Chapter 311, Tax Code, under a reinvestment zone
130	130	financing plan approved under Section 311.011(d), Tax Code, on or
131	131	before September 1, 1999; and
132	132	(C) is eligible for tax increment financing under
133	133	Chapter 311, Tax Code;
134	134	(5) the total dollar amount of any captured appraised
135	135	value of property that:
136	136	(A) is within a reinvestment zone:
137	137	(i) created on or before December 31, 2008,
138	138	by a municipality with a population of less than 18,000; and
139	139	(ii) the project plan for which includes
140	140	the alteration, remodeling, repair, or reconstruction of a
141	141	structure that is included on the National Register of Historic
142	142	Places and requires that a portion of the tax increment of the zone
143	143	be used for the improvement or construction of related facilities
144	144	or for affordable housing;
145	145	(B) generates school district taxes that are paid
146	146	into a tax increment fund created under Chapter 311, Tax Code; and
147	147	(C) is eligible for tax increment financing under
148	148	Chapter 311, Tax Code;
149	149	(6) the total dollar amount of any exemptions granted
150	150	under Section 11.251 or 11.253, Tax Code;
151	151	(7) the difference between the comptroller's estimate
152	152	of the market value and the productivity value of land that
153	153	qualifies for appraisal on the basis of its productive capacity,
154	154	except that the productivity value estimated by the comptroller may
155	155	not exceed the fair market value of the land;
156	156	(8) the portion of the appraised value of residence
157	157	homesteads of individuals who receive a tax limitation under
158	158	Section 11.26, Tax Code, on which school district taxes are not
159	159	imposed in the year that is the subject of the study, calculated as
160	160	if the residence homesteads were appraised at the full value
161	161	required by law;
162	162	(9) a portion of the market value of property not
163	163	otherwise fully taxable by the district at market value because of
164	164	action required by statute or the constitution of this state, other
165	165	than Section 11.311, Tax Code, that, if the tax rate adopted by the
166	166	district is applied to it, produces an amount equal to the
167	167	difference between the tax that the district would have imposed on
168	168	the property if the property were fully taxable at market value and
169	169	the tax that the district is actually authorized to impose on the
170	170	property, if this subsection does not otherwise require that
171	171	portion to be deducted;
172	172	(10) the market value of all tangible personal
173	173	property, other than manufactured homes, owned by a family or
174	174	individual and not held or used for the production of income;
175	175	(11) the appraised value of property the collection of
176	176	delinquent taxes on which is deferred under Section 33.06, Tax
177	177	Code;
178	178	(12) the portion of the appraised value of property
179	179	the collection of delinquent taxes on which is deferred under
180	180	Section 33.065, Tax Code;
181	181	(13) the amount by which the market value of real
182	182	property [a residence homestead] to which Section 23.23, Tax Code,
183	183	applies exceeds the appraised value of that property as calculated
184	184	under that section; and
185	185	(14) the total dollar amount of any exemptions granted
186	186	under Section 11.35, Tax Code.
187	187	(i) If the comptroller determines in the study that the
188	188	market value of property in a school district as determined by the
189	189	appraisal district that appraises property for the school district,
190	190	less the total of the amounts and values listed in Subsection (d) as
191	191	determined by that appraisal district, is valid, the comptroller,
192	192	in determining the taxable value of property in the school district
193	193	under Subsection (d), shall for purposes of Subsection (d)(13)
194	194	subtract from the market value as determined by the appraisal
195	195	district of properties [residence homesteads] to which Section
196	196	23.23, Tax Code, applies the amount by which that amount exceeds the
197	197	appraised value of those properties as calculated by the appraisal
198	198	district under Section 23.23, Tax Code. If the comptroller
199	199	determines in the study that the market value of property in a
200	200	school district as determined by the appraisal district that
201	201	appraises property for the school district, less the total of the
202	202	amounts and values listed in Subsection (d) as determined by that
203	203	appraisal district, is not valid, the comptroller, in determining
204	204	the taxable value of property in the school district under
205	205	Subsection (d), shall for purposes of Subsection (d)(13) subtract
206	206	from the market value as estimated by the comptroller of properties
207	207	[residence homesteads] to which Section 23.23, Tax Code, applies
208	208	the amount by which that amount exceeds the appraised value of those
209	209	properties as calculated by the appraisal district under Section
210	210	23.23, Tax Code.
211	211	SECTION 6. This Act applies only to the appraisal for ad
212	212	valorem tax purposes of real property for a tax year that begins on
213	213	or after the effective date of this Act.
214	214	SECTION 7. This Act takes effect January 1, 2022, but only
215	215	if the constitutional amendment proposed by the 87th Legislature,
216	216	2nd Called Session, 2021, to authorize the legislature to limit the
217	217	maximum appraised value of real property for ad valorem tax
218	218	purposes to 103.5 percent or more of the appraised value of the
219	219	property for the preceding tax year is approved by the voters. If
220	220	that amendment is not approved by the voters, this Act has no
221	221	effect.