Texas 2023 - 88th Regular

Texas House Bill HB2 Compare Versions

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1	1	88R18893 CJC/TJB/KJE-F
2	2	By: Meyer, Bonnen, Burrows, Thierry, Raymond, H.B. No. 2
3	3	et al.
4	4
5	5
6	6	A BILL TO BE ENTITLED
7	7	AN ACT
8	8	relating to providing property tax relief through the public school
9	9	finance system and property tax appraisal and administration.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	ARTICLE 1. SHORT TITLE
12	12	SECTION 1.01. This Act may be cited as the Property Tax
13	13	Relief Act.
14	14	ARTICLE 2. SCHOOL DISTRICT TAX RATE COMPRESSION
15	15	SECTION 2.01. Subchapter F, Chapter 48, Education Code, is
16	16	amended by adding Section 48.2555 to read as follows:
17	17	Sec. 48.2555. MAXIMUM COMPRESSED TAX RATE FOR 2023-2024
18	18	SCHOOL YEAR. (a) Notwithstanding any other provision of this title
19	19	or Chapter 26, Tax Code, for the 2023-2024 school year, the
20	20	commissioner shall calculate the value of a school district's
21	21	maximum compressed tax rate by determining the district's maximum
22	22	compressed rate under Section 48.2551 or 48.2552(b), if applicable,
23	23	and reducing the tax rate determined under the applicable section
24	24	by $0.15.
25	25	(b) If a school district's maximum compressed tax rate as
26	26	calculated under Subsection (a) would be less than 90 percent of
27	27	another school district's maximum compressed tax rate under
28	28	Subsection (a), the district's maximum compressed tax rate is the
29	29	value at which the district's maximum compressed tax rate would be
30	30	equal to 90 percent of the other district's maximum compressed tax
31	31	rate.
32	32	(c) Notwithstanding any other provision of this title or
33	33	Chapter 26, Tax Code, for purposes of determining funding for
34	34	school districts for the 2023-2024 school year, a reference in any
35	35	of the following provisions of law to a school district's maximum
36	36	compressed tax rate or maximum compressed rate as determined under
37	37	Section 48.2551 means the maximum compressed tax rate determined
38	38	for the district under this section:
39	39	(1) Section 13.054(f);
40	40	(2) Section 45.003(d);
41	41	(3) Section 45.0032(a);
42	42	(4) Section 48.051(a);
43	43	(5) Sections 48.2553(a) and (e); and
44	44	(6) Section 26.08(n), Tax Code.
45	45	(d) For purposes of Section 30.003(f-1), a reference in that
46	46	section to Section 48.2551 includes this section.
47	47	(e) Notwithstanding any other provision of this title, for
48	48	purposes of determining a school district's maximum compressed tax
49	49	rate under Section 48.2551 for the 2024-2025 school year, the value
50	50	of the district's "PYMCR" is the maximum compressed tax rate
51	51	determined for the district under this section for the preceding
52	52	school year.
53	53	(f) This section expires September 1, 2025.
54	54	ARTICLE 3. ESCROW ACCOUNTS
55	55	SECTION 3.01. Section 31.072(a), Tax Code, is amended to
56	56	read as follows:
57	57	(a) At the request of a property owner, the [The] collector
58	58	for a taxing unit shall [may] enter a contract with the [a] property
59	59	owner under which the property owner deposits money in an escrow
60	60	account maintained by the collector to provide for the payment of
61	61	property taxes collected by the collector on any property the
62	62	person owns.
63	63	SECTION 3.02. Sections 31.072(h) and (i), Tax Code, are
64	64	repealed.
65	65	SECTION 3.03. This article applies only to a tax year that
66	66	begins on or after the effective date of this article.
67	67	ARTICLE 4. LIMITATION ON INCREASES IN VALUE OF REAL PROPERTY
68	68	SECTION 4.01. Section 1.12(d), Tax Code, is amended to read
69	69	as follows:
70	70	(d) For purposes of this section, the appraisal ratio of
71	71	property [a homestead] to which Section 23.23 applies is the ratio
72	72	of the property's market value as determined by the appraisal
73	73	district or appraisal review board, as applicable, to the market
74	74	value of the property according to law. The appraisal ratio is not
75	75	calculated according to the appraised value of the property as
76	76	limited by Section 23.23.
77	77	SECTION 4.02. The heading to Section 23.23, Tax Code, is
78	78	amended to read as follows:
79	79	Sec. 23.23. LIMITATION ON APPRAISED VALUE OF REAL PROPERTY
80	80	[RESIDENCE HOMESTEAD].
81	81	SECTION 4.03. Section 23.23, Tax Code, is amended by
82	82	amending Subsections (a), (b), (c), and (e) and adding Subsections
83	83	(c-2), (c-3), (c-4), and (h) to read as follows:
84	84	(a) Notwithstanding the requirements of Section 25.18 and
85	85	regardless of whether the appraisal office has appraised the
86	86	property and determined the market value of the property for the tax
87	87	year, an appraisal office may increase the appraised value of real
88	88	property [a residence homestead] for a tax year to an amount not to
89	89	exceed the lesser of:
90	90	(1) the market value of the property for the most
91	91	recent tax year that the market value was determined by the
92	92	appraisal office; or
93	93	(2) the sum of:
94	94	(A) five [10] percent of the appraised value of
95	95	the property for the preceding tax year;
96	96	(B) the appraised value of the property for the
97	97	preceding tax year; and
98	98	(C) the market value of all new improvements to
99	99	the property.
100	100	(b) When appraising real property [a residence homestead],
101	101	the chief appraiser shall:
102	102	(1) appraise the property at its market value; and
103	103	(2) include in the appraisal records both the market
104	104	value of the property and the amount computed under Subsection
105	105	(a)(2).
106	106	(c) The limitation provided by Subsection (a) takes effect
107	107	on January 1 of the tax year following the first tax year in which
108	108	the owner owns the property on January 1 [as to a residence
109	109	homestead on January 1 of the tax year following the first tax year
110	110	the owner qualifies the property for an exemption under Section
111	111	11.13]. Except as provided by Subsection (c-2) or (c-3), the [The]
112	112	limitation expires on January 1 of the first tax year following the
113	113	year in which [that neither] the owner of the property ceases to own
114	114	the property.
115	115	(c-2) If property subject to a limitation under this section
116	116	qualifies for an exemption under Section 11.13 when the ownership
117	117	of the property is transferred to the owner's spouse or surviving
118	118	spouse, the limitation expires on January 1 of the first tax year
119	119	following the year in which [when the limitation took effect nor]
120	120	the owner's spouse or surviving spouse ceases to own the property,
121	121	unless the limitation is further continued under this subsection on
122	122	the subsequent transfer to a spouse or surviving spouse [qualifies
123	123	for an exemption under Section 11.13].
124	124	(c-3) If property subject to a limitation under Subsection
125	125	(a), other than a residence homestead, is owned by two or more
126	126	persons, the limitation expires on January 1 of the first tax year
127	127	following the year in which the ownership of at least a 50 percent
128	128	interest in the property is sold or otherwise transferred.
129	129	(c-4) For purposes of applying the limitation provided by
130	130	this section, a person who acquired real property in a tax year
131	131	before the 2023 tax year, other than property that qualified as the
132	132	residence homestead of the person under Section 11.13 in the 2023
133	133	tax year, is considered to have acquired the property on January 1,
134	134	2023.
135	135	(e) In this section, "new improvement" means an improvement
136	136	to real property [a residence homestead] made after the most recent
137	137	appraisal of the property that increases the market value of the
138	138	property and the value of which is not included in the appraised
139	139	value of the property for the preceding tax year. The term does not
140	140	include repairs to or ordinary maintenance of an existing structure
141	141	or the grounds or another feature of the property.
142	142	(h) In this section, "real property" includes a
143	143	manufactured home as that term is defined by Section 1201.003,
144	144	Occupations Code, that qualifies as a residence homestead under
145	145	Section 11.13 of this code, regardless of whether the owner of the
146	146	manufactured home elects to treat the manufactured home as real
147	147	property under Section 1201.2055, Occupations Code.
148	148	SECTION 4.04. Section 42.26(d), Tax Code, is amended to
149	149	read as follows:
150	150	(d) For purposes of this section, the value of the property
151	151	subject to the suit and the value of a comparable property or sample
152	152	property that is used for comparison must be the market value
153	153	determined by the appraisal district when the property is [a
154	154	residence homestead] subject to the limitation on appraised value
155	155	imposed by Section 23.23.
156	156	SECTION 4.05. Sections 403.302(d) and (i), Government Code,
157	157	are amended to read as follows:
158	158	(d) For the purposes of this section, "taxable value" means
159	159	the market value of all taxable property less:
160	160	(1) the total dollar amount of any residence homestead
161	161	exemptions lawfully granted under Section 11.13(b) or (c), Tax
162	162	Code, in the year that is the subject of the study for each school
163	163	district;
164	164	(2) one-half of the total dollar amount of any
165	165	residence homestead exemptions granted under Section 11.13(n), Tax
166	166	Code, in the year that is the subject of the study for each school
167	167	district;
168	168	(3) the total dollar amount of any exemptions granted
169	169	before May 31, 1993, within a reinvestment zone under agreements
170	170	authorized by Chapter 312, Tax Code;
171	171	(4) subject to Subsection (e), the total dollar amount
172	172	of any captured appraised value of property that:
173	173	(A) is within a reinvestment zone created on or
174	174	before May 31, 1999, or is proposed to be included within the
175	175	boundaries of a reinvestment zone as the boundaries of the zone and
176	176	the proposed portion of tax increment paid into the tax increment
177	177	fund by a school district are described in a written notification
178	178	provided by the municipality or the board of directors of the zone
179	179	to the governing bodies of the other taxing units in the manner
180	180	provided by former Section 311.003(e), Tax Code, before May 31,
181	181	1999, and within the boundaries of the zone as those boundaries
182	182	existed on September 1, 1999, including subsequent improvements to
183	183	the property regardless of when made;
184	184	(B) generates taxes paid into a tax increment
185	185	fund created under Chapter 311, Tax Code, under a reinvestment zone
186	186	financing plan approved under Section 311.011(d), Tax Code, on or
187	187	before September 1, 1999; and
188	188	(C) is eligible for tax increment financing under
189	189	Chapter 311, Tax Code;
190	190	(5) the total dollar amount of any captured appraised
191	191	value of property that:
192	192	(A) is within a reinvestment zone:
193	193	(i) created on or before December 31, 2008,
194	194	by a municipality with a population of less than 18,000; and
195	195	(ii) the project plan for which includes
196	196	the alteration, remodeling, repair, or reconstruction of a
197	197	structure that is included on the National Register of Historic
198	198	Places and requires that a portion of the tax increment of the zone
199	199	be used for the improvement or construction of related facilities
200	200	or for affordable housing;
201	201	(B) generates school district taxes that are paid
202	202	into a tax increment fund created under Chapter 311, Tax Code; and
203	203	(C) is eligible for tax increment financing under
204	204	Chapter 311, Tax Code;
205	205	(6) the total dollar amount of any exemptions granted
206	206	under Section 11.251 or 11.253, Tax Code;
207	207	(7) the difference between the comptroller's estimate
208	208	of the market value and the productivity value of land that
209	209	qualifies for appraisal on the basis of its productive capacity,
210	210	except that the productivity value estimated by the comptroller may
211	211	not exceed the fair market value of the land;
212	212	(8) the portion of the appraised value of residence
213	213	homesteads of individuals who receive a tax limitation under
214	214	Section 11.26, Tax Code, on which school district taxes are not
215	215	imposed in the year that is the subject of the study, calculated as
216	216	if the residence homesteads were appraised at the full value
217	217	required by law;
218	218	(9) a portion of the market value of property not
219	219	otherwise fully taxable by the district at market value because of
220	220	action required by statute or the constitution of this state, other
221	221	than Section 11.311, Tax Code, that, if the tax rate adopted by the
222	222	district is applied to it, produces an amount equal to the
223	223	difference between the tax that the district would have imposed on
224	224	the property if the property were fully taxable at market value and
225	225	the tax that the district is actually authorized to impose on the
226	226	property, if this subsection does not otherwise require that
227	227	portion to be deducted;
228	228	(10) the market value of all tangible personal
229	229	property, other than manufactured homes, owned by a family or
230	230	individual and not held or used for the production of income;
231	231	(11) the appraised value of property the collection of
232	232	delinquent taxes on which is deferred under Section 33.06, Tax
233	233	Code;
234	234	(12) the portion of the appraised value of property
235	235	the collection of delinquent taxes on which is deferred under
236	236	Section 33.065, Tax Code;
237	237	(13) the amount by which the market value of property
238	238	[a residence homestead] to which Section 23.23, Tax Code, applies
239	239	exceeds the appraised value of that property as calculated under
240	240	that section; and
241	241	(14) the total dollar amount of any exemptions granted
242	242	under Section 11.35, Tax Code.
243	243	(i) If the comptroller determines in the study that the
244	244	market value of property in a school district as determined by the
245	245	appraisal district that appraises property for the school district,
246	246	less the total of the amounts and values listed in Subsection (d) as
247	247	determined by that appraisal district, is valid, the comptroller,
248	248	in determining the taxable value of property in the school district
249	249	under Subsection (d), shall for purposes of Subsection (d)(13)
250	250	subtract from the market value as determined by the appraisal
251	251	district of properties [residence homesteads] to which Section
252	252	23.23, Tax Code, applies the amount by which that amount exceeds the
253	253	appraised value of those properties as calculated by the appraisal
254	254	district under Section 23.23, Tax Code. If the comptroller
255	255	determines in the study that the market value of property in a
256	256	school district as determined by the appraisal district that
257	257	appraises property for the school district, less the total of the
258	258	amounts and values listed in Subsection (d) as determined by that
259	259	appraisal district, is not valid, the comptroller, in determining
260	260	the taxable value of property in the school district under
261	261	Subsection (d), shall for purposes of Subsection (d)(13) subtract
262	262	from the market value as estimated by the comptroller of properties
263	263	[residence homesteads] to which Section 23.23, Tax Code, applies
264	264	the amount by which that amount exceeds the appraised value of those
265	265	properties as calculated by the appraisal district under Section
266	266	23.23, Tax Code.
267	267	SECTION 4.06. Section 23.23(c-1), Tax Code, is repealed.
268	268	SECTION 4.07. This article applies only to the appraisal
269	269	for ad valorem tax purposes of property for a tax year that begins
270	270	on or after the effective date of this article.
271	271	ARTICLE 5. EFFECTIVE DATES
272	272	SECTION 5.01. Except as otherwise provided by this article,
273	273	this Act takes effect September 1, 2023.
274	274	SECTION 5.02. Article 3 of this Act takes effect January 1,
275	275	2024.
276	276	SECTION 5.03. Article 4 of this Act takes effect January 1,
277	277	2024, but only if the constitutional amendment proposed by the 88th
278	278	Legislature, Regular Session, 2023, to authorize the legislature to
279	279	limit the maximum appraised value of real property for ad valorem
280	280	tax purposes and to except certain appropriations to pay for ad
281	281	valorem tax relief from the constitutional limitation on the rate
282	282	of growth of appropriations is approved by the voters. If that
283	283	amendment is not approved by the voters, Article 4 of this Act has
284	284	no effect.