Texas 2023 - 88th Regular

Texas House Bill HB1189 Compare Versions

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1	1	88R1084 TJB-D
2	2	By: Davis H.B. No. 1189
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to limitations on the appraised value of certain real
8	8	property in specified areas for ad valorem tax purposes.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 1.12(d), Tax Code, is amended to read as
11	11	follows:
12	12	(d) For purposes of this section, the appraisal ratio of
13	13	real property [a homestead] to which Section 23.23, 23.231, or
14	14	23.232 applies is the ratio of the property's market value as
15	15	determined by the appraisal district or appraisal review board, as
16	16	applicable, to the market value of the property according to law.
17	17	The appraisal ratio is not calculated according to the appraised
18	18	value of the property as limited by Section 23.23, 23.231, or
19	19	23.232.
20	20	SECTION 2. Subchapter B, Chapter 23, Tax Code, is amended by
21	21	adding Sections 23.231 and 23.232 to read as follows:
22	22	Sec. 23.231. TEMPORARY LIMITATION ON APPRAISED VALUE OF
23	23	CERTAIN REAL PROPERTY IN SPECIFIED AREAS. (a) In this section:
24	24	(1) "Census tract" means the geographic area
25	25	identified as a "tract" on the 2020 Census TIGER/Line Shapefiles,
26	26	prepared by the federal Bureau of the Census for the Twenty-fourth
27	27	Decennial Census of the United States, enumerated as of April 1,
28	28	2020.
29	29	(2) "Eligible property" means real property that:
30	30	(A) is:
31	31	(i) a residence homestead; or
32	32	(ii) an undeveloped lot, subject to
33	33	Subsection (f); and
34	34	(B) is located in one of the following census
35	35	tracts:
36	36	(i) Dallas County tract 002703; or
37	37	(ii) Harris County tract 210900, 211000,
38	38	211101, 211102, 211200, or 211700.
39	39	(3) "Residence homestead" has the meaning assigned by
40	40	Section 11.13.
41	41	(b) The governing body of a municipality, county, or school
42	42	district may by official action adopt a limitation as prescribed by
43	43	this section on the appraised value of all eligible property
44	44	located in the taxing unit adopting the limitation. The governing
45	45	body of a municipality, county, or school district may not repeal,
46	46	rescind, or take other action to negate the adoption of the
47	47	limitation once adopted under this subsection.
48	48	(c) Notwithstanding the requirements of Sections 23.23 and
49	49	25.18, and regardless of whether the appraisal office has appraised
50	50	the property and determined the market value of the property for the
51	51	tax year, an appraisal office may increase the appraised value of
52	52	eligible property for a tax year to which a limitation under this
53	53	section applies for purposes of taxation of the property by the
54	54	taxing unit that adopted the limitation to an amount not to exceed
55	55	the lesser of:
56	56	(1) the appraised value of the property as otherwise
57	57	determined by law; or
58	58	(2) the appraised value of the property for the tax
59	59	year preceding the tax year in which the limitation adopted by that
60	60	taxing unit first applies, as provided by Subsection (e).
61	61	(d) When appraising eligible property, the chief appraiser
62	62	shall:
63	63	(1) appraise the property as otherwise determined by
64	64	law; and
65	65	(2) include in the appraisal records:
66	66	(A) the appraised value of the property
67	67	determined under Subdivision (1); and
68	68	(B) the amount determined under Subsection
69	69	(c)(2) applicable to each taxing unit that has adopted the
70	70	limitation.
71	71	(e) Except as provided by Subsection (f), a limitation once
72	72	adopted by a governing body under this section applies to each tax
73	73	year:
74	74	(1) beginning with:
75	75	(A) the tax year in which the governing body
76	76	adopts the limitation, if the governing body adopts the limitation
77	77	on or before April 1; or
78	78	(B) the tax year following the tax year in which
79	79	the governing body adopts the limitation, if the governing body
80	80	adopts the limitation after April 1; and
81	81	(2) ending with the 2039 tax year.
82	82	(f) A limitation adopted under this section as applied to a
83	83	vacant lot expires on the earlier of:
84	84	(1) January 1 following the end of the fifth tax year
85	85	for which the limitation applies, unless:
86	86	(A) a single-family residence has been
87	87	constructed on the property; and
88	88	(B) the owner of the residence has qualified the
89	89	property as the owner's residence homestead; or
90	90	(2) January 1 of the tax year in which the vacant lot
91	91	is:
92	92	(A) developed for a purpose other than as a
93	93	single-family residence; or
94	94	(B) developed as a single-family residence but
95	95	not qualified as the residence homestead of an owner of the
96	96	property.
97	97	(g) This section expires January 1, 2040.
98	98	Sec. 23.232. LIMITATION ON APPRAISED VALUE OF RAPIDLY
99	99	APPRECIATING RESIDENCE HOMESTEADS IN SPECIFIED AREAS. (a) In this
100	100	section:
101	101	(1) "Census tract" means the geographic area
102	102	identified as a "tract" on the 2020 Census TIGER/Line Shapefiles,
103	103	prepared by the federal Bureau of the Census for the Twenty-fourth
104	104	Decennial Census of the United States, enumerated as of April 1,
105	105	2020.
106	106	(2) "Disaster recovery program" means the disaster
107	107	recovery program administered by the General Land Office or by a
108	108	political subdivision of this state that is funded with community
109	109	development block grant disaster recovery money authorized by
110	110	federal law.
111	111	(3) "New improvement" means an improvement to a
112	112	rapidly appreciating residence homestead made after the most recent
113	113	appraisal of the property that increases the market value of the
114	114	property and the value of which is not included in the appraised
115	115	value of the property for the preceding tax year. The term does not
116	116	include repairs to or ordinary maintenance of an existing structure
117	117	or the grounds or another feature of the property.
118	118	(4) "Rapidly appreciating residence homestead" means
119	119	real property:
120	120	(A) that is a residence homestead;
121	121	(B) that is located in Dallas County census tract
122	122	004300, 010101, 010102, 010500, 010601, 010602, or 020500;
123	123	(C) for which the owner was granted a residence
124	124	homestead exemption in the 2017, 2018, 2019, 2020, 2021, 2022,
125	125	2023, and 2024 tax years; and
126	126	(D) for which the market value for the 2024 tax
127	127	year is at least 25 percent higher than the market value of the
128	128	property for the 2017 tax year.
129	129	(5) "Residence homestead" has the meaning assigned by
130	130	Section 11.13.
131	131	(b) Notwithstanding the requirements of Sections 23.23 and
132	132	25.18, and regardless of whether the appraisal office has appraised
133	133	the property and determined the market value of the property for the
134	134	tax year, an appraisal office may increase the appraised value of a
135	135	rapidly appreciating residence homestead for a tax year to an
136	136	amount not to exceed the lesser of:
137	137	(1) the market value of the property for the most
138	138	recent tax year that the market value was determined by the
139	139	appraisal office; or
140	140	(2) the sum of:
141	141	(A) the appraised value of the property for the
142	142	2017 tax year; and
143	143	(B) the market value of all new improvements to
144	144	the property.
145	145	(c) When appraising a rapidly appreciating residence
146	146	homestead, the chief appraiser shall:
147	147	(1) appraise the property at its market value; and
148	148	(2) include in the appraisal records:
149	149	(A) the market value of the property; and
150	150	(B) the amount determined under Subsection
151	151	(b)(2).
152	152	(d) The limitation provided by Subsection (b) expires on
153	153	January 1 of the first tax year that neither the owner of the
154	154	property when the limitation took effect nor the owner's spouse or
155	155	surviving spouse qualifies for an exemption under Section 11.13.
156	156	(e) Notwithstanding Subsection (b), and except as provided
157	157	by Subdivision (2), an improvement to property that would otherwise
158	158	constitute a new improvement is not treated as a new improvement if
159	159	the improvement is a replacement structure for a structure that was
160	160	rendered uninhabitable or unusable by a casualty or by wind, fire,
161	161	or water damage. For purposes of appraising the property under
162	162	Subsection (b) in the tax year in which the structure would have
163	163	constituted a new improvement:
164	164	(1) the appraised value the property would have had in
165	165	the preceding tax year if the casualty or damage had not occurred is
166	166	considered to be the appraised value of the property for that year,
167	167	regardless of whether that appraised value exceeds the actual
168	168	appraised value of the property for that year as limited by
169	169	Subsection (b); and
170	170	(2) the replacement structure is considered to be a
171	171	new improvement only if:
172	172	(A) the square footage of the replacement
173	173	structure exceeds that of the replaced structure as that structure
174	174	existed before the casualty or damage occurred; or
175	175	(B) the exterior of the replacement structure is
176	176	of higher quality construction and composition than that of the
177	177	replaced structure.
178	178	(f) Notwithstanding Subsection (e)(2), and only to the
179	179	extent necessary to satisfy the requirements of the disaster
180	180	recovery program, a replacement structure described by that
181	181	subdivision is not considered to be a new improvement if to satisfy
182	182	the requirements of the disaster recovery program it was necessary
183	183	that:
184	184	(1) the square footage of the replacement structure
185	185	exceed that of the replaced structure as that structure existed
186	186	before the casualty or damage occurred; or
187	187	(2) the exterior of the replacement structure be of
188	188	higher quality construction and composition than that of the
189	189	replaced structure.
190	190	SECTION 3. Sections 25.19(b) and (g), Tax Code, are amended
191	191	to read as follows:
192	192	(b) The chief appraiser shall separate real from personal
193	193	property and include in the notice for each:
194	194	(1) a list of the taxing units in which the property is
195	195	taxable;
196	196	(2) the appraised value of the property in the
197	197	preceding year;
198	198	(3) the taxable value of the property in the preceding
199	199	year for each taxing unit taxing the property;
200	200	(4) the appraised value of the property for the
201	201	current year, the kind and amount of each exemption and partial
202	202	exemption, if any, approved for the property for the current year
203	203	and for the preceding year, and, if an exemption or partial
204	204	exemption that was approved for the preceding year was canceled or
205	205	reduced for the current year, the amount of the exemption or partial
206	206	exemption canceled or reduced;
207	207	(4-a) a statement of whether the property qualifies
208	208	for a limitation on appraised value under Section 23.231 or 23.232;
209	209	(5) in italic typeface, the following statement: "The
210	210	Texas Legislature does not set the amount of your local taxes. Your
211	211	property tax burden is decided by your locally elected officials,
212	212	and all inquiries concerning your taxes should be directed to those
213	213	officials";
214	214	(6) a detailed explanation of the time and procedure
215	215	for protesting the value;
216	216	(7) the date and place the appraisal review board will
217	217	begin hearing protests;
218	218	(8) an explanation of the availability and purpose of
219	219	an informal conference with the appraisal office before a hearing
220	220	on a protest; and
221	221	(9) a brief explanation that the governing body of
222	222	each taxing unit decides whether or not taxes on the property will
223	223	increase and the appraisal district only determines the value of
224	224	the property.
225	225	(g) By April 1 or as soon thereafter as practicable if the
226	226	property is a single-family residence that qualifies for an
227	227	exemption under Section 11.13, or by May 1 or as soon thereafter as
228	228	practicable in connection with any other property, the chief
229	229	appraiser shall deliver a written notice to the owner of each
230	230	property not included in a notice required to be delivered under
231	231	Subsection (a), if the property was reappraised in the current tax
232	232	year, if the ownership of the property changed during the preceding
233	233	year, or if the property owner or the agent of a property owner
234	234	authorized under Section 1.111 makes a written request for the
235	235	notice. The chief appraiser shall separate real from personal
236	236	property and include in the notice for each property:
237	237	(1) the appraised value of the property in the
238	238	preceding year;
239	239	(2) the appraised value of the property for the
240	240	current year and the kind of each partial exemption, if any,
241	241	approved for the current year;
242	242	(2-a) a statement of whether the property qualifies
243	243	for a limitation on appraised value under Section 23.231 or 23.232;
244	244	(3) a detailed explanation of the time and procedure
245	245	for protesting the value; and
246	246	(4) the date and place the appraisal review board will
247	247	begin hearing protests.
248	248	SECTION 4. Section 41.41(a), Tax Code, is amended to read as
249	249	follows:
250	250	(a) A property owner is entitled to protest before the
251	251	appraisal review board the following actions:
252	252	(1) determination of the appraised value of the
253	253	owner's property or, in the case of land appraised as provided by
254	254	Subchapter C, D, E, or H, Chapter 23, determination of its appraised
255	255	or market value;
256	256	(2) unequal appraisal of the owner's property;
257	257	(3) inclusion of the owner's property on the appraisal
258	258	records;
259	259	(4) denial to the property owner in whole or in part of
260	260	a partial exemption;
261	261	(4-a) determination that the owner's property does not
262	262	qualify for a limitation on appraised value under Section 23.231 or
263	263	23.232;
264	264	(5) determination that the owner's land does not
265	265	qualify for appraisal as provided by Subchapter C, D, E, or H,
266	266	Chapter 23;
267	267	(6) identification of the taxing units in which the
268	268	owner's property is taxable in the case of the appraisal district's
269	269	appraisal roll;
270	270	(7) determination that the property owner is the owner
271	271	of property;
272	272	(8) a determination that a change in use of land
273	273	appraised under Subchapter C, D, E, or H, Chapter 23, has occurred;
274	274	or
275	275	(9) any other action of the chief appraiser, appraisal
276	276	district, or appraisal review board that applies to and adversely
277	277	affects the property owner.
278	278	SECTION 5. Section 42.26(d), Tax Code, is amended to read as
279	279	follows:
280	280	(d) For purposes of this section, the value of the property
281	281	subject to the suit and the value of a comparable property or sample
282	282	property that is used for comparison must be the market value
283	283	determined by the appraisal district when the property is [a
284	284	residence homestead] subject to a [the] limitation on appraised
285	285	value under [imposed by] Section 23.23, 23.231, or 23.232.
286	286	SECTION 6. This Act applies only to the appraisal of real
287	287	property for ad valorem tax purposes for a tax year that begins on
288	288	or after the effective date of this Act.
289	289	SECTION 7. This Act takes effect January 1, 2024, but only
290	290	if the constitutional amendment proposed by the 88th Legislature,
291	291	Regular Session, 2023, to authorize the legislature to provide for
292	292	limitations on the appraised value of certain real property in
293	293	specified areas for ad valorem tax purposes is approved by the
294	294	voters. If that amendment is not approved by the voters, this Act
295	295	has no effect.