Texas 2021 - 87th 2nd C.S.

Texas House Bill HB157 Compare Versions

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1	1	87S20012 SMH-D
2	2	By: Allison H.B. No. 157
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the ad valorem taxation of residential real property.
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. Section 11.13, Tax Code, is amended by amending
19	19	Subsection (i) and adding Subsection (s) to read as follows:
20	20	(i) The assessor and collector for a taxing unit may
21	21	disregard the exemptions authorized by Subsection (b), (c), (d),
22	22	[or] (n), or (s) [of this section] and assess and collect a tax
23	23	pledged for payment of debt without deducting the amount of the
24	24	exemption if:
25	25	(1) prior to adoption of the exemption, the taxing
26	26	unit pledged the taxes for the payment of a debt; and
27	27	(2) granting the exemption would impair the obligation
28	28	of the contract creating the debt.
29	29	(s) In addition to any other exemptions provided by this
30	30	section, an individual who purchases property and qualifies the
31	31	property as the individual's residence homestead is entitled to an
32	32	exemption from taxation of the total appraised value of the
33	33	property for the first tax year the individual qualifies the
34	34	property as the individual's residence homestead if the property:
35	35	(1) is the first property the individual has ever
36	36	qualified as the individual's residence homestead; and
37	37	(2) has an appraised value of less than $300,000 for
38	38	that first tax year.
39	39	SECTION 3. Subchapter B, Chapter 11, Tax Code, is amended by
40	40	adding Section 11.262 to read as follows:
41	41	Sec. 11.262. LIMITATION OF TAXES ON HOMESTEADS FOLLOWING
42	42	CERTAIN PERIOD. (a) In this section, "residence homestead" has the
43	43	meaning assigned by Section 11.13.
44	44	(b) The chief appraiser shall appraise, and the tax assessor
45	45	for each taxing unit shall calculate the taxes on, each residence
46	46	homestead in the manner provided by law for other property.
47	47	(c) Except as provided by Subsection (h), if an individual
48	48	qualifies property as the individual's residence homestead for at
49	49	least 25 consecutive tax years, a taxing unit may not impose taxes
50	50	on that residence homestead in a subsequent tax year in an amount
51	51	that exceeds the lesser of the following amounts:
52	52	(1) the amount of taxes calculated for the taxing unit
53	53	for the current tax year under Subsection (b); or
54	54	(2) the amount of taxes imposed by the taxing unit for
55	55	that 25th tax year.
56	56	(d) For purposes of this section, if the first tax year an
57	57	individual qualified property as the individual's residence
58	58	homestead was a tax year before the 1999 tax year, the individual is
59	59	considered to have qualified the property as the individual's
60	60	residence homestead for the first time in the 1999 tax year.
61	61	(e) If an individual who qualifies for a limitation under
62	62	this section dies, the surviving spouse of the individual is
63	63	entitled to continue receiving the limitation applicable to the
64	64	residence homestead of the individual if the property:
65	65	(1) is the residence homestead of the surviving spouse
66	66	on the date that the individual dies; and
67	67	(2) remains the residence homestead of the surviving
68	68	spouse.
69	69	(f) Except as provided by Subsection (e) or (g), a
70	70	limitation under this section expires on January 1 if the property
71	71	is not the residence homestead of the individual entitled to the
72	72	limitation for the preceding tax year.
73	73	(g) A limitation under this section does not expire if:
74	74	(1) an owner of an interest in the residence homestead
75	75	conveys the interest to a qualifying trust as defined by Section
76	76	11.13(j) and the owner or the owner's spouse is:
77	77	(A) a trustor of the trust; and
78	78	(B) entitled to occupy the property; or
79	79	(2) the owner of the structure qualifies for an
80	80	exemption under Section 11.13 under the circumstances described by
81	81	Section 11.135(a).
82	82	(h) Except as provided by Subsection (i), a taxing unit may
83	83	increase the tax on a residence homestead subject to a limitation
84	84	under this section in the first year the appraised value of the
85	85	property is increased as the result of an improvement made to the
86	86	property in the preceding tax year. The amount of the tax increase
87	87	is determined by applying the current tax rate of the taxing unit to
88	88	the difference in the taxable value of the property with the
89	89	improvement and the taxable value the property would have had
90	90	without the improvement. A limitation imposed by this section then
91	91	applies to the increased amount of tax until another improvement is
92	92	made to the property.
93	93	(i) An improvement to a residence homestead is not treated
94	94	as an improvement under Subsection (h) if the improvement is:
95	95	(1) a repair;
96	96	(2) required to be made to comply with a governmental
97	97	requirement; or
98	98	(3) subject to Subsection (j), a replacement structure
99	99	for a structure that was rendered uninhabitable or unusable by a
100	100	casualty or by wind or water damage.
101	101	(j) A replacement structure described by Subsection (i)(3)
102	102	is considered to be an improvement under Subsection (h) only if:
103	103	(1) the square footage of the replacement structure
104	104	exceeds the square footage of the replaced structure as the
105	105	replaced structure existed before the casualty or damage occurred;
106	106	or
107	107	(2) the exterior of the replacement structure is of
108	108	higher quality construction and composition than that of the
109	109	replaced structure.
110	110	(k) If the appraisal roll provides for taxation of appraised
111	111	value for a prior year because a limitation under this section was
112	112	erroneously allowed, the tax assessor for the taxing unit shall add
113	113	as back taxes due, as provided by Section 26.09(d), the positive
114	114	difference, if any, between the tax that should have been imposed
115	115	for that tax year and the tax that was imposed because of the
116	116	provisions of this section.
117	117	(l) For each school district in an appraisal district, the
118	118	chief appraiser shall determine the portion of the appraised value
119	119	of residence homesteads of individuals on which school district
120	120	taxes are not imposed in a tax year because of the limitation under
121	121	this section. That portion is calculated by determining the
122	122	taxable value that, if multiplied by the tax rate adopted by the
123	123	school district for the tax year, would produce an amount equal to
124	124	the amount of tax that would have been imposed by the school
125	125	district on those properties if the limitation under this section
126	126	were not in effect, but that was not imposed because of that
127	127	limitation. The chief appraiser shall determine that taxable value
128	128	and certify it to the comptroller as soon as practicable for each
129	129	tax year.
130	130	SECTION 4. Sections 23.19(b) and (g), Tax Code, are amended
131	131	to read as follows:
132	132	(b) If an appraisal district receives a written request for
133	133	the appraisal of real property and improvements of a cooperative
134	134	housing corporation according to the separate interests of the
135	135	corporation's stockholders, the chief appraiser shall separately
136	136	appraise the interests described by Subsection (d) if the
137	137	conditions required by Subsections (e) and (f) have been met.
138	138	Separate appraisal under this section is for the purposes of
139	139	administration of tax exemptions, determination of applicable
140	140	limitations of taxes under Section 11.26, [or] 11.261, or 11.262,
141	141	and apportionment by a cooperative housing corporation of property
142	142	taxes among its stockholders but is not the basis for determining
143	143	value on which a tax is imposed under this title. A stockholder
144	144	whose interest is separately appraised under this section may
145	145	protest and appeal the appraised value in the manner provided by
146	146	this title for protest and appeal of the appraised value of other
147	147	property.
148	148	(g) A tax bill or a separate statement accompanying the tax
149	149	bill to a cooperative housing corporation for which interests of
150	150	stockholders are separately appraised under this section must
151	151	state, in addition to the information required by Section 31.01,
152	152	the appraised value and taxable value of each interest separately
153	153	appraised. Each exemption claimed as provided by this title by a
154	154	person entitled to the exemption shall also be deducted from the
155	155	total appraised value of the property of the corporation. The total
156	156	tax imposed by a school district, county, municipality, or junior
157	157	college district shall be reduced by any amount that represents an
158	158	increase in taxes attributable to separately appraised interests of
159	159	the real property and improvements that are subject to the
160	160	limitation of taxes prescribed by Section 11.26, [or] 11.261, or
161	161	11.262. The corporation shall apportion among its stockholders
162	162	liability for reimbursing the corporation for property taxes
163	163	according to the relative taxable values of their interests.
164	164	SECTION 5. The heading to Section 23.23, Tax Code, is
165	165	amended to read as follows:
166	166	Sec. 23.23. LIMITATION ON APPRAISED VALUE OF RESIDENTIAL
167	167	REAL PROPERTY [RESIDENCE HOMESTEAD].
168	168	SECTION 6. Section 23.23, Tax Code, is amended by amending
169	169	Subsections (a), (b), (c), (e), and (f) and adding Subsections
170	170	(c-1), (c-2), and (c-3) to read as follows:
171	171	(a) Notwithstanding the requirements of Section 25.18 and
172	172	regardless of whether the appraisal office has appraised the
173	173	property and determined the market value of the property for the tax
174	174	year, an appraisal office may increase the appraised value of
175	175	residential real property [a residence homestead] for a tax year to
176	176	an amount not to exceed the lesser of:
177	177	(1) the market value of the property for the most
178	178	recent tax year that the market value was determined by the
179	179	appraisal office; or
180	180	(2) the sum of:
181	181	(A) five [10] percent of the appraised value of
182	182	the property for the preceding tax year;
183	183	(B) the appraised value of the property for the
184	184	preceding tax year; and
185	185	(C) the market value of all new improvements to
186	186	the property.
187	187	(b) When appraising residential real property [a residence
188	188	homestead], the chief appraiser shall:
189	189	(1) appraise the property at its market value; and
190	190	(2) include in the appraisal records both the market
191	191	value of the property and the amount computed under Subsection
192	192	(a)(2).
193	193	(c) The limitation provided by Subsection (a) takes effect
194	194	on January 1 of the tax year following the first tax year in which
195	195	the owner owns the property on January 1 or, if the property
196	196	qualifies as the [to a] residence homestead of the owner under
197	197	Section 11.13 in the tax year in which the owner acquires the
198	198	property, the limitation takes effect on January 1 of the tax year
199	199	following that [the first] tax year [the owner qualifies the
200	200	property for an exemption under Section 11.13]. Except as provided
201	201	by Subsection (c-1) or (c-2), the [The] limitation expires on
202	202	January 1 of the first tax year following the year in which [that
203	203	neither] the owner of the property ceases to own the property.
204	204	(c-1) If property subject to a limitation under this section
205	205	qualifies for an exemption under Section 11.13 when the ownership
206	206	of the property is transferred to the owner's spouse or surviving
207	207	spouse, the limitation expires on January 1 of the first tax year
208	208	following the year in which [when the limitation took effect nor]
209	209	the owner's spouse or surviving spouse ceases to own the property,
210	210	unless the limitation is further continued under this subsection on
211	211	the subsequent transfer to a spouse or surviving spouse [qualifies
212	212	for an exemption under Section 11.13].
213	213	(c-2) If property subject to a limitation under Subsection
214	214	(a), other than a residence homestead, is owned by two or more
215	215	persons, the limitation expires on January 1 of the first tax year
216	216	following the year in which the ownership of at least a 50 percent
217	217	interest in the property is sold or otherwise transferred.
218	218	(c-3) For purposes of applying the limitation provided by
219	219	this section in the first tax year after the 2022 tax year in which
220	220	the property is appraised for taxation:
221	221	(1) the property is considered to have been appraised
222	222	for taxation in the 2022 tax year at a market value equal to the
223	223	appraised value of the property for that tax year;
224	224	(2) a person who acquired residential real property in
225	225	a tax year before the 2022 tax year is considered to have acquired
226	226	the property on January 1, 2022; and
227	227	(3) a person who qualified the property for an
228	228	exemption under Section 11.13 as the person's residence homestead
229	229	for any portion of the 2022 tax year is considered to have acquired
230	230	the property in the 2022 tax year.
231	231	(e) In this section:
232	232	(1) "New [, "new] improvement" means an improvement to
233	233	real property [a residence homestead] made after the most recent
234	234	appraisal of the property that increases the market value of the
235	235	property and the value of which is not included in the appraised
236	236	value of the property for the preceding tax year. The term does not
237	237	include repairs to or ordinary maintenance of an existing structure
238	238	or the grounds or another feature of the property.
239	239	(2) "Residential real property":
240	240	(A) means real property that:
241	241	(i) qualifies for an exemption under
242	242	Section 11.13; or
243	243	(ii) is designed or adapted for residential
244	244	purposes, including the residential portion, not to exceed 20
245	245	acres, of farm or ranch property; and
246	246	(B) does not include real property on which a
247	247	hotel, motel, or similar structure is located that is designed to
248	248	provide temporary lodging or accommodations.
249	249	(f) Notwithstanding Subsections (a) and (e)(1) [(e)] and
250	250	except as provided by Subdivision (2) of this subsection, an
251	251	improvement to property that would otherwise constitute a new
252	252	improvement is not treated as a new improvement if the improvement
253	253	is a replacement structure for a structure that was rendered
254	254	uninhabitable or unusable by a casualty or by wind or water damage.
255	255	For purposes of appraising the property under Subsection (a) in the
256	256	tax year in which the structure would have constituted a new
257	257	improvement:
258	258	(1) the appraised value the property would have had in
259	259	the preceding tax year if the casualty or damage had not occurred is
260	260	considered to be the appraised value of the property for that year,
261	261	regardless of whether that appraised value exceeds the actual
262	262	appraised value of the property for that year as limited by
263	263	Subsection (a); and
264	264	(2) the replacement structure is considered to be a
265	265	new improvement only if:
266	266	(A) the square footage of the replacement
267	267	structure exceeds that of the replaced structure as that structure
268	268	existed before the casualty or damage occurred; or
269	269	(B) the exterior of the replacement structure is
270	270	of higher quality construction and composition than that of the
271	271	replaced structure.
272	272	SECTION 7. Sections 26.012(6), (13), and (14), Tax Code,
273	273	are amended to read as follows:
274	274	(6) "Current total value" means the total taxable
275	275	value of property listed on the appraisal roll for the current year,
276	276	including all appraisal roll supplements and corrections as of the
277	277	date of the calculation, less the taxable value of property
278	278	exempted for the current tax year for the first time under Section
279	279	11.31 or 11.315, except that:
280	280	(A) the current total value for a school district
281	281	excludes:
282	282	(i) the total value of homesteads that
283	283	qualify for a tax limitation as provided by Section 11.26; and
284	284	(ii) new property value of property that is
285	285	subject to an agreement entered into under Chapter 313; [and]
286	286	(B) the current total value for a county,
287	287	municipality, or junior college district excludes the total value
288	288	of homesteads that qualify for a tax limitation provided by Section
289	289	11.261; and
290	290	(C) the current total value for a taxing unit
291	291	excludes the total value of homesteads that qualify for a tax
292	292	limitation as provided by Section 11.262.
293	293	(13) "Last year's levy" means the total of:
294	294	(A) the amount of taxes that would be generated
295	295	by multiplying the total tax rate adopted by the governing body in
296	296	the preceding year by the total taxable value of property on the
297	297	appraisal roll for the preceding year, including:
298	298	(i) taxable value that was reduced in an
299	299	appeal under Chapter 42;
300	300	(ii) all appraisal roll supplements and
301	301	corrections other than corrections made pursuant to Section
302	302	25.25(d), as of the date of the calculation, except that last year's
303	303	taxable value for a school district excludes the total value of
304	304	homesteads that qualified for a tax limitation as provided by
305	305	Section 11.26, [and] last year's taxable value for a county,
306	306	municipality, or junior college district excludes the total value
307	307	of homesteads that qualified for a tax limitation as provided by
308	308	Section 11.261, and last year's taxable value for a taxing unit
309	309	excludes the total value of homesteads that qualified for a tax
310	310	limitation as provided by Section 11.262; and
311	311	(iii) the portion of taxable value of
312	312	property that is the subject of an appeal under Chapter 42 on July
313	313	25 that is not in dispute; and
314	314	(B) the amount of taxes refunded by the taxing
315	315	unit in the preceding year for tax years before that year.
316	316	(14) "Last year's total value" means the total taxable
317	317	value of property listed on the appraisal roll for the preceding
318	318	year, including all appraisal roll supplements and corrections,
319	319	other than corrections made pursuant to Section 25.25(d), as of the
320	320	date of the calculation, except that:
321	321	(A) last year's taxable value for a school
322	322	district excludes the total value of homesteads that qualified for
323	323	a tax limitation as provided by Section 11.26; [and]
324	324	(B) last year's taxable value for a county,
325	325	municipality, or junior college district excludes the total value
326	326	of homesteads that qualified for a tax limitation as provided by
327	327	Section 11.261; and
328	328	(C) last year's taxable value for a taxing unit
329	329	excludes the total value of homesteads that qualified for a tax
330	330	limitation as provided by Section 11.262.
331	331	SECTION 8. Section 42.26(d), Tax Code, is amended to read as
332	332	follows:
333	333	(d) For purposes of this section, the value of the property
334	334	subject to the suit and the value of a comparable property or sample
335	335	property that is used for comparison must be the market value
336	336	determined by the appraisal district when the property is [a
337	337	residence homestead] subject to the limitation on appraised value
338	338	imposed by Section 23.23.
339	339	SECTION 9. Section 44.004(c), Education Code, as amended by
340	340	H.B. No. 2723, Acts of the 87th Legislature, Regular Session, 2021,
341	341	is amended to read as follows:
342	342	(c) The notice of public meeting to discuss and adopt the
343	343	budget and the proposed tax rate may not be smaller than one-quarter
344	344	page of a standard-size or a tabloid-size newspaper, and the
345	345	headline on the notice must be in 18-point or larger type. Subject
346	346	to Subsection (d), the notice must:
347	347	(1) contain a statement in the following form:
348	348	"NOTICE OF PUBLIC MEETING TO DISCUSS BUDGET AND PROPOSED TAX RATE
349	349	"The (name of school district) will hold a public meeting at
350	350	(time, date, year) in (name of room, building, physical location,
351	351	city, state). The purpose of this meeting is to discuss the school
352	352	district's budget that will determine the tax rate that will be
353	353	adopted. Public participation in the discussion is invited." The
354	354	statement of the purpose of the meeting must be in bold type. In
355	355	reduced type, the notice must state: "The tax rate that is
356	356	ultimately adopted at this meeting or at a separate meeting at a
357	357	later date may not exceed the proposed rate shown below unless the
358	358	district publishes a revised notice containing the same information
359	359	and comparisons set out below and holds another public meeting to
360	360	discuss the revised notice." In addition, in reduced type, the
361	361	notice must state: "Visit Texas.gov/PropertyTaxes to find a link to
362	362	your local property tax database on which you can easily access
363	363	information regarding your property taxes, including information
364	364	about proposed tax rates and scheduled public hearings of each
365	365	entity that taxes your property.";
366	366	(2) contain a section entitled "Comparison of Proposed
367	367	Budget with Last Year's Budget," which must show the difference,
368	368	expressed as a percent increase or decrease, as applicable, in the
369	369	amounts budgeted for the preceding fiscal year and the amount
370	370	budgeted for the fiscal year that begins in the current tax year for
371	371	each of the following:
372	372	(A) maintenance and operations;
373	373	(B) debt service; and
374	374	(C) total expenditures;
375	375	(3) contain a section entitled "Total Appraised Value
376	376	and Total Taxable Value," which must show the total appraised value
377	377	and the total taxable value of all property and the total appraised
378	378	value and the total taxable value of new property taxable by the
379	379	district in the preceding tax year and the current tax year as
380	380	calculated under Section 26.04, Tax Code;
381	381	(4) contain a statement of the total amount of the
382	382	outstanding and unpaid bonded indebtedness of the school district;
383	383	(5) contain a section entitled "Comparison of Proposed
384	384	Rates with Last Year's Rates," which must:
385	385	(A) show in rows the tax rates described by
386	386	Subparagraphs (i)-(iii), expressed as amounts per $100 valuation of
387	387	property, for columns entitled "Maintenance & Operations,"
388	388	"Interest & Sinking Fund," and "Total," which is the sum of
389	389	"Maintenance & Operations" and "Interest & Sinking Fund":
390	390	(i) the school district's "Last Year's
391	391	Rate";
392	392	(ii) the "Rate to Maintain Same Level of
393	393	Maintenance & Operations Revenue & Pay Debt Service," which:
394	394	(a) in the case of "Maintenance &
395	395	Operations," is the tax rate that, when applied to the current
396	396	taxable value for the district, as certified by the chief appraiser
397	397	under Section 26.01, Tax Code, and as adjusted to reflect changes
398	398	made by the chief appraiser as of the time the notice is prepared,
399	399	would impose taxes in an amount that, when added to state funds to
400	400	be distributed to the district under Chapter 48, would provide the
401	401	same amount of maintenance and operations taxes and state funds
402	402	distributed under Chapter 48 per student in average daily
403	403	attendance for the applicable school year that was available to the
404	404	district in the preceding school year; and
405	405	(b) in the case of "Interest & Sinking
406	406	Fund," is the tax rate that, when applied to the current taxable
407	407	value for the district, as certified by the chief appraiser under
408	408	Section 26.01, Tax Code, and as adjusted to reflect changes made by
409	409	the chief appraiser as of the time the notice is prepared, and when
410	410	multiplied by the district's anticipated collection rate, would
411	411	impose taxes in an amount that, when added to state funds to be
412	412	distributed to the district under Chapter 46 and any excess taxes
413	413	collected to service the district's debt during the preceding tax
414	414	year but not used for that purpose during that year, would provide
415	415	the amount required to service the district's debt; and
416	416	(iii) the "Proposed Rate";
417	417	(B) contain fourth and fifth columns aligned with
418	418	the columns required by Paragraph (A) that show, for each row
419	419	required by Paragraph (A):
420	420	(i) the "Local Revenue per Student," which
421	421	is computed by multiplying the district's total taxable value of
422	422	property, as certified by the chief appraiser for the applicable
423	423	school year under Section 26.01, Tax Code, and as adjusted to
424	424	reflect changes made by the chief appraiser as of the time the
425	425	notice is prepared, by the total tax rate, and dividing the product
426	426	by the number of students in average daily attendance in the
427	427	district for the applicable school year; and
428	428	(ii) the "State Revenue per Student," which
429	429	is computed by determining the amount of state aid received or to be
430	430	received by the district under Chapters 43, 46, and 48 and dividing
431	431	that amount by the number of students in average daily attendance in
432	432	the district for the applicable school year; and
433	433	(C) contain an asterisk after each calculation
434	434	for "Interest & Sinking Fund" and a footnote to the section that, in
435	435	reduced type, states "The Interest & Sinking Fund tax revenue is
436	436	used to pay for bonded indebtedness on construction, equipment, or
437	437	both. The bonds, and the tax rate necessary to pay those bonds,
438	438	were approved by the voters of this district.";
439	439	(6) contain a section entitled "Comparison of Proposed
440	440	Levy with Last Year's Levy on Average Residence," which must:
441	441	(A) show in rows the information described by
442	442	Subparagraphs (i)-(iv), rounded to the nearest dollar, for columns
443	443	entitled "Last Year" and "This Year":
444	444	(i) "Average Market Value of Residences,"
445	445	determined using the same group of residences for each year;
446	446	(ii) "Average Taxable Value of Residences,"
447	447	determined after taking into account the limitation on the
448	448	appraised value of residences under Section 23.23, Tax Code, and
449	449	after subtracting all homestead exemptions applicable in each year,
450	450	other than exemptions available only to disabled persons or persons
451	451	65 years of age or older or their surviving spouses, and using the
452	452	same group of residences for each year;
453	453	(iii) "Last Year's Rate Versus Proposed
454	454	Rate per $100 Value"; and
455	455	(iv) "Taxes Due on Average Residence,"
456	456	determined using the same group of residences for each year; and
457	457	(B) contain the following information: "Increase
458	458	(Decrease) in Taxes" expressed in dollars and cents, which is
459	459	computed by subtracting the "Taxes Due on Average Residence" for
460	460	the preceding tax year from the "Taxes Due on Average Residence" for
461	461	the current tax year;
462	462	(7) contain the following statement in bold print:
463	463	"Under state law, the dollar amount of school taxes imposed on the
464	464	residence of a person 65 years of age or older or of the surviving
465	465	spouse of such a person, if the surviving spouse was 55 years of age
466	466	or older when the person died, may not be increased above the amount
467	467	paid in the first year after the person turned 65, regardless of
468	468	changes in tax rate or property value.";
469	469	(8) contain the following statement in bold print:
470	470	"Notice of Voter-Approval Rate: The highest tax rate the district
471	471	can adopt before requiring voter approval at an election is (the
472	472	school district voter-approval rate determined under Section
473	473	26.08, Tax Code). This election will be automatically held if the
474	474	district adopts a rate in excess of the voter-approval rate of (the
475	475	school district voter-approval rate)."; [and]
476	476	(9) contain a section entitled "Fund Balances," which
477	477	must include the estimated amount of interest and sinking fund
478	478	balances and the estimated amount of maintenance and operation or
479	479	general fund balances remaining at the end of the current fiscal
480	480	year that are not encumbered with or by corresponding debt
481	481	obligation, less estimated funds necessary for the operation of the
482	482	district before the receipt of the first payment under Chapter 48 in
483	483	the succeeding school year; and
484	484	(10) contain the following statement in bold print:
485	485	"Under state law, the dollar amount of school taxes imposed on a
486	486	residence homestead that qualifies as the owner's residence
487	487	homestead for at least 25 consecutive years may not be increased
488	488	above the amount of school taxes imposed on the property in that
489	489	25th consecutive year, regardless of changes in tax rate or
490	490	property value."[.]
491	491	SECTION 10. Section 46.071, Education Code, is amended by
492	492	adding Subsection (a-2) and amending Subsections (b) and (c) to
493	493	read as follows:
494	494	(a-2) Beginning with the 2023-2024 school year, in addition
495	495	to state aid a school district is entitled to under Subsection (a),
496	496	a school district is also entitled to additional state aid under
497	497	this subchapter to the extent that state and local revenue used to
498	498	service debt eligible under this chapter is less than the state and
499	499	local revenue that would have been available to the district under
500	500	this chapter as it existed on September 1, 2022, if the exemption
501	501	for an individual's first residence homestead under Section 1-b(q),
502	502	Article VIII, Texas Constitution, as proposed by the 87th
503	503	Legislature, 2nd Called Session, 2021, had not been adopted.
504	504	(b) Subject to Subsections (c)-(e), additional state aid
505	505	under this section is equal to the amount by which the loss of local
506	506	interest and sinking revenue for debt service attributable to the
507	507	increase in the residence homestead exemption under Section 1-b(c),
508	508	Article VIII, Texas Constitution, and the additional limitation on
509	509	tax increases under Section 1-b(d) of that article as proposed by
510	510	S.J.R. 1, 84th Legislature, Regular Session, 2015, and the
511	511	residence homestead exemption under Section 1-b(q), Article VIII,
512	512	Texas Constitution, as proposed by the 87th Legislature, 2nd Called
513	513	Session, 2021, is not offset by a gain in state aid under this
514	514	chapter.
515	515	(c) For the purpose of determining state aid under
516	516	Subsection (a) or (a-2) [this section], local interest and sinking
517	517	revenue for debt service is limited to revenue required to service
518	518	debt eligible under this chapter as of September 1, 2015, or as of
519	519	September 1, 2022, respectively, including refunding of the
520	520	applicable [that] debt, subject to Section 46.061. The limitation
521	521	imposed by Section 46.034(a) does not apply for the purpose of
522	522	determining state aid under Subsection (a) or (a-2) [this section].
523	523	SECTION 11. Subchapter F, Chapter 48, Education Code, is
524	524	amended by adding Section 48.2541 to read as follows:
525	525	Sec. 48.2541. ADDITIONAL STATE AID FOR HOMESTEAD EXEMPTION.
526	526	(a) Beginning with the 2023-2024 school year, a school district is
527	527	entitled to additional state aid to the extent that state and local
528	528	revenue under this chapter and Chapter 49 is less than the state and
529	529	local revenue that would have been available to the district under
530	530	Chapter 49 and this chapter as those chapters existed on September
531	531	1, 2022, if the exemption for an individual's first residence
532	532	homestead under Section 1-b(q), Article VIII, Texas Constitution,
533	533	as proposed by the joint resolution to add that subsection adopted
534	534	by the 87th Legislature, 2nd Called Session, 2021, had not been
535	535	adopted.
536	536	(b) The lesser of the school district's currently adopted
537	537	maintenance and operations tax rate or the adopted maintenance and
538	538	operations tax rate for the 2022 tax year is used for the purpose of
539	539	determining additional state aid under Subsection (a).
540	540	SECTION 12. Sections 403.302(d), (d-1), and (i), Government
541	541	Code, are amended to read as follows:
542	542	(d) For the purposes of this section, "taxable value" means
543	543	the market value of all taxable property less:
544	544	(1) the total dollar amount of any residence homestead
545	545	exemptions lawfully granted under Section 11.13(b) or (c), Tax
546	546	Code, in the year that is the subject of the study for each school
547	547	district;
548	548	(2) one-half of the total dollar amount of any
549	549	residence homestead exemptions granted under Section 11.13(n), Tax
550	550	Code, in the year that is the subject of the study for each school
551	551	district;
552	552	(3) the total dollar amount of any exemptions granted
553	553	before May 31, 1993, within a reinvestment zone under agreements
554	554	authorized by Chapter 312, Tax Code;
555	555	(4) subject to Subsection (e), the total dollar amount
556	556	of any captured appraised value of property that:
557	557	(A) is within a reinvestment zone created on or
558	558	before May 31, 1999, or is proposed to be included within the
559	559	boundaries of a reinvestment zone as the boundaries of the zone and
560	560	the proposed portion of tax increment paid into the tax increment
561	561	fund by a school district are described in a written notification
562	562	provided by the municipality or the board of directors of the zone
563	563	to the governing bodies of the other taxing units in the manner
564	564	provided by former Section 311.003(e), Tax Code, before May 31,
565	565	1999, and within the boundaries of the zone as those boundaries
566	566	existed on September 1, 1999, including subsequent improvements to
567	567	the property regardless of when made;
568	568	(B) generates taxes paid into a tax increment
569	569	fund created under Chapter 311, Tax Code, under a reinvestment zone
570	570	financing plan approved under Section 311.011(d), Tax Code, on or
571	571	before September 1, 1999; and
572	572	(C) is eligible for tax increment financing under
573	573	Chapter 311, Tax Code;
574	574	(5) the total dollar amount of any captured appraised
575	575	value of property that:
576	576	(A) is within a reinvestment zone:
577	577	(i) created on or before December 31, 2008,
578	578	by a municipality with a population of less than 18,000; and
579	579	(ii) the project plan for which includes
580	580	the alteration, remodeling, repair, or reconstruction of a
581	581	structure that is included on the National Register of Historic
582	582	Places and requires that a portion of the tax increment of the zone
583	583	be used for the improvement or construction of related facilities
584	584	or for affordable housing;
585	585	(B) generates school district taxes that are paid
586	586	into a tax increment fund created under Chapter 311, Tax Code; and
587	587	(C) is eligible for tax increment financing under
588	588	Chapter 311, Tax Code;
589	589	(6) the total dollar amount of any exemptions granted
590	590	under Section 11.251 or 11.253, Tax Code;
591	591	(7) the difference between the comptroller's estimate
592	592	of the market value and the productivity value of land that
593	593	qualifies for appraisal on the basis of its productive capacity,
594	594	except that the productivity value estimated by the comptroller may
595	595	not exceed the fair market value of the land;
596	596	(8) the portion of the appraised value of residence
597	597	homesteads of individuals who receive a tax limitation under
598	598	Section 11.26 or 11.262, Tax Code, on which school district taxes
599	599	are not imposed in the year that is the subject of the study,
600	600	calculated as if the residence homesteads were appraised at the
601	601	full value required by law;
602	602	(9) a portion of the market value of property not
603	603	otherwise fully taxable by the district at market value because of
604	604	action required by statute or the constitution of this state, other
605	605	than Section 11.311, Tax Code, that, if the tax rate adopted by the
606	606	district is applied to it, produces an amount equal to the
607	607	difference between the tax that the district would have imposed on
608	608	the property if the property were fully taxable at market value and
609	609	the tax that the district is actually authorized to impose on the
610	610	property, if this subsection does not otherwise require that
611	611	portion to be deducted;
612	612	(10) the market value of all tangible personal
613	613	property, other than manufactured homes, owned by a family or
614	614	individual and not held or used for the production of income;
615	615	(11) the appraised value of property the collection of
616	616	delinquent taxes on which is deferred under Section 33.06, Tax
617	617	Code;
618	618	(12) the portion of the appraised value of property
619	619	the collection of delinquent taxes on which is deferred under
620	620	Section 33.065, Tax Code;
621	621	(13) the amount by which the market value of real
622	622	property [a residence homestead] to which Section 23.23, Tax Code,
623	623	applies exceeds the appraised value of that property as calculated
624	624	under that section; and
625	625	(14) the total dollar amount of any exemptions granted
626	626	under Section 11.35, Tax Code.
627	627	(d-1) For purposes of Subsection (d), a residence homestead
628	628	that receives an exemption under Section 11.13(s), 11.131, 11.133,
629	629	or 11.134, Tax Code, in the year that is the subject of the study is
630	630	not considered to be taxable property.
631	631	(i) If the comptroller determines in the study that the
632	632	market value of property in a school district as determined by the
633	633	appraisal district that appraises property for the school district,
634	634	less the total of the amounts and values listed in Subsection (d) as
635	635	determined by that appraisal district, is valid, the comptroller,
636	636	in determining the taxable value of property in the school district
637	637	under Subsection (d), shall for purposes of Subsection (d)(13)
638	638	subtract from the market value as determined by the appraisal
639	639	district of properties [residence homesteads] to which Section
640	640	23.23, Tax Code, applies the amount by which that amount exceeds the
641	641	appraised value of those properties as calculated by the appraisal
642	642	district under Section 23.23, Tax Code. If the comptroller
643	643	determines in the study that the market value of property in a
644	644	school district as determined by the appraisal district that
645	645	appraises property for the school district, less the total of the
646	646	amounts and values listed in Subsection (d) as determined by that
647	647	appraisal district, is not valid, the comptroller, in determining
648	648	the taxable value of property in the school district under
649	649	Subsection (d), shall for purposes of Subsection (d)(13) subtract
650	650	from the market value as estimated by the comptroller of properties
651	651	[residence homesteads] to which Section 23.23, Tax Code, applies
652	652	the amount by which that amount exceeds the appraised value of those
653	653	properties as calculated by the appraisal district under Section
654	654	23.23, Tax Code.
655	655	SECTION 13. Section 11.13(s), Tax Code, as added by this
656	656	Act, applies only to the appraisal for ad valorem tax purposes of
657	657	residence homesteads for a tax year that begins on or after the
658	658	effective date of this Act.
659	659	SECTION 14. Section 11.262, Tax Code, as added by this Act,
660	660	applies only to ad valorem taxes imposed for a tax year that begins
661	661	on or after the effective date of this Act.
662	662	SECTION 15. Section 23.23, Tax Code, as amended by this Act,
663	663	applies only to the appraisal for ad valorem tax purposes of
664	664	residential real property for a tax year that begins on or after the
665	665	effective date of this Act.
666	666	SECTION 16. This Act takes effect January 1, 2023, but only
667	667	if the constitutional amendment proposed by the 87th Legislature,
668	668	2nd Called Session, 2021, authorizing the legislature to limit the
669	669	maximum appraised value of residential real property for ad valorem
670	670	tax purposes to 105 percent or more of the appraised value of the
671	671	property for the preceding tax year, to exempt from ad valorem
672	672	taxation the total appraised value of property purchased by an
673	673	individual for the first tax year the individual qualifies the
674	674	property as the individual's residence homestead if the property is
675	675	the individual's first residence homestead and has an appraised
676	676	value of less than $300,000, and to limit the total amount of ad
677	677	valorem taxes that a political subdivision may impose on the
678	678	residence homestead of an individual and the surviving spouse of
679	679	the individual if the individual qualifies the property as the
680	680	individual's residence homestead for at least 25 consecutive tax
681	681	years is approved by the voters. If that constitutional amendment
682	682	is not approved by the voters, this Act has no effect.