Texas 2023 - 88th Regular

Texas House Bill HB2220 Compare Versions

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1	1	88R2439 TJB-D
2	2	By: Harrison H.B. No. 2220
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the calculation of certain ad valorem tax rates of a
8	8	taxing unit and the manner in which a proposed ad valorem tax rate
9	9	that exceeds the voter-approval tax rate is approved; making
10	10	conforming changes.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Section 48.202(f), Education Code, is amended to
13	13	read as follows:
14	14	(f) For a school year in which the dollar amount guaranteed
15	15	level of state and local funds per weighted student per cent of tax
16	16	effort ("GL") under Subsection (a-1)(2) exceeds the dollar amount
17	17	guaranteed level of state and local funds per weighted student per
18	18	cent of tax effort ("GL") under Subsection (a-1)(2) for the
19	19	preceding school year, a school district shall reduce the
20	20	district's tax rate under Section 45.0032(b)(2) for the tax year
21	21	that corresponds to that school year to a rate that results in the
22	22	amount of state and local funds per weighted student per cent of tax
23	23	effort available to the district at the dollar amount guaranteed
24	24	level for the preceding school year. A school district is not
25	25	entitled to the amount equal to the increase of revenue described by
26	26	this subsection for the school year for which the district must
27	27	reduce the district's tax rate. For [Unless Section 26.042(e), Tax
28	28	Code, applies to the district, for] a tax year in which a district
29	29	must reduce the district's tax rate under this subsection, the
30	30	district may not increase the district's maintenance and operations
31	31	tax rate to a rate that exceeds the maximum maintenance and
32	32	operations tax rate permitted under Section 45.003(d) or (f), as
33	33	applicable, minus the reduction of tax effort required under this
34	34	subsection. This subsection does not apply if the amount of state
35	35	funds appropriated for a school year specifically excludes the
36	36	amount necessary to provide the dollar amount guaranteed level of
37	37	state and local funds per weighted student per cent of tax effort
38	38	under Subsection (a-1)(2).
39	39	SECTION 2. Section 3828.157, Special District Local Laws
40	40	Code, is amended to read as follows:
41	41	Sec. 3828.157. INAPPLICABILITY OF CERTAIN TAX CODE
42	42	PROVISIONS. Sections 26.04, [26.042,] 26.05, and 26.07, [and
43	43	26.075,] Tax Code, do not apply to a tax imposed under Section
44	44	3828.153 or 3828.156.
45	45	SECTION 3. Section 8876.152(a), Special District Local Laws
46	46	Code, is amended to read as follows:
47	47	(a) Sections 26.04, [26.042,] 26.05, 26.06, 26.061, and
48	48	26.07, [and 26.075,] Tax Code, do not apply to a tax imposed by the
49	49	district.
50	50	SECTION 4. Section 26.012(3), Tax Code, is amended to read
51	51	as follows:
52	52	(3) "Current debt service" means the minimum dollar
53	53	amount required to be expended for debt service for the current
54	54	year.
55	55	SECTION 5. Section 26.04(c), Tax Code, is amended to read as
56	56	follows:
57	57	(c) After the assessor for the taxing unit submits the
58	58	appraisal roll for the taxing unit to the governing body of the
59	59	taxing unit as required by Subsection (b), an officer or employee
60	60	designated by the governing body shall calculate the no-new-revenue
61	61	tax rate and the voter-approval tax rate for the taxing unit, where:
62	62	(1) "No-new-revenue tax rate" means a rate expressed
63	63	in dollars per $100 of taxable value calculated according to the
64	64	following formula:
65	65	NO-NEW-REVENUE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY
66	66	LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
67	67	; and
68	68	(2) "Voter-approval tax rate" means a rate expressed
69	69	in dollars per $100 of taxable value calculated according to the
70	70	following [applicable] formula:
71	71	[(A) for a special taxing unit:]
72	72	VOTER-APPROVAL TAX RATE = [(]NO-NEW-REVENUE MAINTENANCE AND
73	73	OPERATIONS RATE [x 1.08)] + CURRENT DEBT RATE
74	74	[; or
75	75	[(B) for a taxing unit other than a special taxing
76	76	unit:
77	77	[VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE AND
78	78	OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE + UNUSED INCREMENT
79	79	RATE)]
80	80	SECTION 6. Sections 26.041(a), (b), and (c), Tax Code, are
81	81	amended to read as follows:
82	82	(a) In the first year in which an additional sales and use
83	83	tax is required to be collected, the no-new-revenue tax rate and
84	84	voter-approval tax rate for the taxing unit are calculated
85	85	according to the following formulas:
86	86	NO-NEW-REVENUE TAX RATE = [(LAST YEAR'S LEVY -
87	87	LOST PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW
88	88	PROPERTY VALUE)] - SALES TAX GAIN RATE
89	89	and
90	90	VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT]
91	91	= [(]NO-NEW-REVENUE MAINTENANCE AND OPERATIONS RATE [x
92	92	1.08)] + [(]CURRENT DEBT RATE - SALES TAX GAIN RATE[)
93	93	[or
94	94	[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER
95	95	THAN SPECIAL TAXING UNIT = (NO-NEW-REVENUE MAINTENANCE
96	96	AND OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE +
97	97	UNUSED INCREMENT RATE - SALES TAX GAIN RATE)]
98	98	where "sales tax gain rate" means a number expressed in dollars per
99	99	$100 of taxable value, calculated by dividing the revenue that will
100	100	be generated by the additional sales and use tax in the following
101	101	year as calculated under Subsection (d) by the current total value.
102	102	(b) Except as provided by Subsections (a) and (c), in a year
103	103	in which a taxing unit imposes an additional sales and use tax, the
104	104	voter-approval tax rate for the taxing unit is calculated according
105	105	to the following formula, regardless of whether the taxing unit
106	106	levied a property tax in the preceding year:
107	107	VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT]
108	108	= [[(]LAST YEAR'S MAINTENANCE AND OPERATIONS EXPENSE
109	109	[x 1.08)] / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)]
110	110	+ (CURRENT DEBT RATE - SALES TAX REVENUE RATE)
111	111	[or
112	112	[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER
113	113	THAN SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE
114	114	AND OPERATIONS EXPENSE x 1.035) / (CURRENT TOTAL VALUE
115	115	- NEW PROPERTY VALUE)] + (CURRENT DEBT RATE + UNUSED
116	116	INCREMENT RATE - SALES TAX REVENUE RATE)]
117	117	where "last year's maintenance and operations expense" means the
118	118	amount spent for maintenance and operations from property tax and
119	119	additional sales and use tax revenues in the preceding year, and
120	120	"sales tax revenue rate" means a number expressed in dollars per
121	121	$100 of taxable value, calculated by dividing the revenue that will
122	122	be generated by the additional sales and use tax in the current year
123	123	as calculated under Subsection (d) by the current total value.
124	124	(c) In a year in which a taxing unit that has been imposing
125	125	an additional sales and use tax ceases to impose an additional sales
126	126	and use tax, the no-new-revenue tax rate and voter-approval tax
127	127	rate for the taxing unit are calculated according to the following
128	128	formulas:
129	129	NO-NEW-REVENUE TAX RATE = [(LAST YEAR'S LEVY -
130	130	LOST PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW
131	131	PROPERTY VALUE)] + SALES TAX LOSS RATE
132	132	and
133	133	VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT]
134	134	= [[(]LAST YEAR'S MAINTENANCE AND OPERATIONS EXPENSE
135	135	[x 1.08)] / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)]
136	136	+ CURRENT DEBT RATE
137	137	[or
138	138	[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER
139	139	THAN SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE
140	140	AND OPERATIONS EXPENSE x 1.035) / (CURRENT TOTAL VALUE
141	141	- NEW PROPERTY VALUE)] + (CURRENT DEBT RATE + UNUSED
142	142	INCREMENT RATE)]
143	143	where "sales tax loss rate" means a number expressed in dollars per
144	144	$100 of taxable value, calculated by dividing the amount of sales
145	145	and use tax revenue generated in the last four quarters for which
146	146	the information is available by the current total value and "last
147	147	year's maintenance and operations expense" means the amount spent
148	148	for maintenance and operations from property tax and additional
149	149	sales and use tax revenues in the preceding year.
150	150	SECTION 7. Section 26.07(b), Tax Code, is amended to read as
151	151	follows:
152	152	(b) If the governing body of a [special] taxing unit [or a
153	153	municipality with a population of 30,000 or more] adopts a tax rate
154	154	that exceeds the taxing unit's voter-approval tax rate, [or the
155	155	governing body of a taxing unit other than a special taxing unit or
156	156	a municipality with a population of less than 30,000 regardless of
157	157	whether it is a special taxing unit adopts a tax rate that exceeds
158	158	the greater of the taxing unit's voter-approval tax rate or de
159	159	minimis rate,] the registered voters of the taxing unit at an
160	160	election held for that purpose must determine whether to approve
161	161	the adopted tax rate.
162	162	SECTION 8. Sections 31.12(a) and (b), Tax Code, are amended
163	163	to read as follows:
164	164	(a) If a refund of a tax provided by Section 11.431(b),
165	165	26.07(g), [26.075(k),] 26.15(f), 31.11, 31.111, or 31.112 is paid
166	166	on or before the 60th day after the date the liability for the
167	167	refund arises, no interest is due on the amount refunded. If not
168	168	paid on or before that 60th day, the amount of the tax to be refunded
169	169	accrues interest at a rate of one percent for each month or part of a
170	170	month that the refund is unpaid, beginning with the date on which
171	171	the liability for the refund arises.
172	172	(b) For purposes of this section, liability for a refund
173	173	arises:
174	174	(1) if the refund is required by Section 11.431(b), on
175	175	the date the chief appraiser notifies the collector for the taxing
176	176	unit of the approval of the late homestead exemption;
177	177	(2) if the refund is required by Section 26.07(g) [or
178	178	26.075(k)], on the date the results of the election to approve [or
179	179	reduce] the tax rate[, as applicable,] are certified;
180	180	(3) if the refund is required by Section 26.15(f):
181	181	(A) for a correction to the tax roll made under
182	182	Section 26.15(b), on the date the change in the tax roll is
183	183	certified to the assessor for the taxing unit under Section 25.25;
184	184	or
185	185	(B) for a correction to the tax roll made under
186	186	Section 26.15(c), on the date the change in the tax roll is ordered
187	187	by the governing body of the taxing unit;
188	188	(4) if the refund is required by Section 31.11, on the
189	189	date the auditor for the taxing unit determines that the payment was
190	190	erroneous or excessive or, if the amount of the refund exceeds the
191	191	applicable amount specified by Section 31.11(a), on the date the
192	192	governing body of the taxing unit approves the refund;
193	193	(5) if the refund is required by Section 31.111, on the
194	194	date the collector for the taxing unit determines that the payment
195	195	was erroneous; or
196	196	(6) if the refund is required by Section 31.112, on the
197	197	date required by Section 31.112(d) or (e), as applicable.
198	198	SECTION 9. Section 33.08(b), Tax Code, is amended to read as
199	199	follows:
200	200	(b) The governing body of the taxing unit or appraisal
201	201	district, in the manner required by law for official action, may
202	202	provide that taxes that become delinquent on or after June 1 under
203	203	Section [26.075(j),] 26.15(e), 31.03, 31.031, 31.032, 31.033,
204	204	31.04, or 42.42 incur an additional penalty to defray costs of
205	205	collection. The amount of the penalty may not exceed the amount of
206	206	the compensation specified in the applicable contract with an
207	207	attorney under Section 6.30 to be paid in connection with the
208	208	collection of the delinquent taxes.
209	209	SECTION 10. Section 49.057, Water Code, is amended by
210	210	amending Subsection (b) and adding Subsection (j) to read as
211	211	follows:
212	212	(b) The board shall adopt an annual budget. The board of a
213	213	developed district[, as defined by Section 49.23602,] shall include
214	214	as an appendix to the budget the district's:
215	215	(1) audited financial statements;
216	216	(2) bond transcripts; and
217	217	(3) engineer's reports required by Section 49.106.
218	218	(j) In this section, "developed district" means a district
219	219	that has financed, completed, and issued bonds to pay for all land,
220	220	works, improvements, facilities, plants, equipment, and appliances
221	221	necessary to serve at least 95 percent of the projected build-out of
222	222	the district in accordance with the purposes for its creation or the
223	223	purposes authorized by the constitution, this code, or any other
224	224	law.
225	225	SECTION 11. Section 49.107(g), Water Code, is amended to
226	226	read as follows:
227	227	(g) Sections 26.04, [26.042,] 26.05, 26.061, and 26.07,
228	228	[and 26.075,] Tax Code, do not apply to a tax levied and collected
229	229	under this section or an ad valorem tax levied and collected for the
230	230	payment of the interest on and principal of bonds issued by a
231	231	district.
232	232	SECTION 12. Section 49.108(f), Water Code, is amended to
233	233	read as follows:
234	234	(f) Sections 26.04, [26.042,] 26.05, 26.061, and 26.07,
235	235	[and 26.075,] Tax Code, do not apply to a tax levied and collected
236	236	for payments made under a contract approved in accordance with this
237	237	section.
238	238	SECTION 13. Section 49.236(a), Water Code, is amended to
239	239	read as follows:
240	240	(a) Before the board adopts an ad valorem tax rate for the
241	241	district for debt service, operation and maintenance purposes, or
242	242	contract purposes, the board shall give notice of each meeting of
243	243	the board at which the adoption of a tax rate will be considered.
244	244	The notice must:
245	245	(1) contain a statement in substantially the following
246	246	form:
247	247	"NOTICE OF PUBLIC HEARING ON TAX RATE
248	248	"The (name of the district) will hold a public hearing on a
249	249	proposed tax rate for the tax year (year of tax levy) on (date and
250	250	time) at (meeting place). Your individual taxes may increase at a
251	251	greater or lesser rate, or even decrease, depending on the tax rate
252	252	that is adopted and on the change in the taxable value of your
253	253	property in relation to the change in taxable value of all other
254	254	property. The change in the taxable value of your property in
255	255	relation to the change in the taxable value of all other property
256	256	determines the distribution of the tax burden among all property
257	257	owners.
258	258	"Visit Texas.gov/PropertyTaxes to find a link to your local
259	259	property tax database on which you can easily access information
260	260	regarding your property taxes, including information about
261	261	proposed tax rates and scheduled public hearings of each entity
262	262	that taxes your property.
263	263	"(Names of all board members and, if a vote was taken, an
264	264	indication of how each voted on the proposed tax rate and an
265	265	indication of any absences.)";
266	266	(2) contain the following information:
267	267	(A) the district's total adopted tax rate for the
268	268	preceding year and the proposed tax rate, expressed as an amount per
269	269	$100;
270	270	(B) the difference, expressed as an amount per
271	271	$100 and as a percent increase or decrease, as applicable, in the
272	272	proposed tax rate compared to the adopted tax rate for the preceding
273	273	year;
274	274	(C) the average appraised value of a residence
275	275	homestead in the district in the preceding year and in the current
276	276	year; the district's total homestead exemption, other than an
277	277	exemption available only to disabled persons or persons 65 years of
278	278	age or older, applicable to that appraised value in each of those
279	279	years; and the average taxable value of a residence homestead in the
280	280	district in each of those years, disregarding any homestead
281	281	exemption available only to disabled persons or persons 65 years of
282	282	age or older;
283	283	(D) the amount of tax that would have been
284	284	imposed by the district in the preceding year on a residence
285	285	homestead appraised at the average appraised value of a residence
286	286	homestead in that year, disregarding any homestead exemption
287	287	available only to disabled persons or persons 65 years of age or
288	288	older;
289	289	(E) the amount of tax that would be imposed by the
290	290	district in the current year on a residence homestead appraised at
291	291	the average appraised value of a residence homestead in that year,
292	292	disregarding any homestead exemption available only to disabled
293	293	persons or persons 65 years of age or older, if the proposed tax
294	294	rate is adopted;
295	295	(F) the difference between the amounts of tax
296	296	calculated under Paragraphs (D) and (E), expressed in dollars and
297	297	cents and described as the annual percentage increase or decrease,
298	298	as applicable, in the tax to be imposed by the district on the
299	299	average residence homestead in the district in the current year if
300	300	the proposed tax rate is adopted; and
301	301	(G) if the proposed combined debt service,
302	302	operation and maintenance, and contract tax rate requires [or
303	303	authorizes] an election to approve [or reduce] the tax rate, [as
304	304	applicable,] a description of the purpose of the proposed tax
305	305	increase;
306	306	(3) contain a statement in substantially the following
307	307	form[, as applicable:
308	308	[(A) if the district is a district described by
309	309	Section 49.23601]:
310	310	"NOTICE OF VOTE ON TAX RATE
311	311	"If the district adopts a combined debt service, operation
312	312	and maintenance, and contract tax rate that would result in the
313	313	taxes on the average residence homestead increasing from the
314	314	preceding year [by more than eight percent], an election must be
315	315	held to determine whether to approve the operation and maintenance
316	316	tax rate under Section 49.23601, Water Code.";
317	317	[(B) if the district is a district described by
318	318	Section 49.23602:
319	319	["NOTICE OF VOTE ON TAX RATE
320	320	["If the district adopts a combined debt service, operation
321	321	and maintenance, and contract tax rate that would result in the
322	322	taxes on the average residence homestead increasing by more than
323	323	3.5 percent, an election must be held to determine whether to
324	324	approve the operation and maintenance tax rate under Section
325	325	49.23602, Water Code."; or
326	326	[(C) if the district is a district described by
327	327	Section 49.23603:
328	328	["NOTICE OF TAXPAYERS' RIGHT TO ELECTION TO REDUCE TAX RATE
329	329	["If the district adopts a combined debt service, operation
330	330	and maintenance, and contract tax rate that would result in the
331	331	taxes on the average residence homestead increasing by more than
332	332	eight percent, the qualified voters of the district by petition may
333	333	require that an election be held to determine whether to reduce the
334	334	operation and maintenance tax rate to the voter-approval tax rate
335	335	under Section 49.23603, Water Code.";] and
336	336	(4) include the following statement: "The 86th Texas
337	337	Legislature modified the manner in which the voter-approval tax
338	338	rate is calculated to limit the rate of growth of property taxes in
339	339	the state.".
340	340	SECTION 14. The heading to Section 49.23601, Water Code, is
341	341	amended to read as follows:
342	342	Sec. 49.23601. AUTOMATIC ELECTION TO APPROVE TAX RATE [FOR
343	343	LOW TAX RATE DISTRICTS].
344	344	SECTION 15. Sections 49.23601(a) and (c), Water Code, are
345	345	amended to read as follows:
346	346	(a) In this section, "voter-approval tax rate" means the
347	347	rate equal to the sum of the following tax rates for the district:
348	348	(1) the current year's debt service tax rate;
349	349	(2) the current year's contract tax rate; and
350	350	(3) the operation and maintenance tax rate that would
351	351	impose [1.08 times] the amount of [the] operation and maintenance
352	352	tax imposed by the district in the preceding year on a residence
353	353	homestead appraised at the average appraised value of a residence
354	354	homestead in the district in that year, disregarding any homestead
355	355	exemption available only to disabled persons or persons 65 years of
356	356	age or older.
357	357	(c) If the board of a district adopts a combined debt
358	358	service, contract, and operation and maintenance tax rate that
359	359	would impose more than [1.08 times] the amount of tax imposed by the
360	360	district in the preceding year on a residence homestead appraised
361	361	at the average appraised value of a residence homestead in the
362	362	district in that year, disregarding any homestead exemption
363	363	available only to disabled persons or persons 65 years of age or
364	364	older, an election must be held in accordance with the procedures
365	365	provided by Sections 26.07(c)-(g), Tax Code, to determine whether
366	366	to approve the adopted tax rate. If the adopted tax rate is not
367	367	approved at the election, the district's tax rate is the
368	368	voter-approval tax rate.
369	369	SECTION 16. The following provisions are repealed:
370	370	(1) Section 45.0032(d), Education Code;
371	371	(2) Section 120.007(d), Local Government Code;
372	372	(3) Sections 26.012(8-a) and (19), Tax Code;
373	373	(4) Section 26.013, Tax Code;
374	374	(5) Section 26.042, Tax Code;
375	375	(6) Section 26.0501(c), Tax Code;
376	376	(7) Section 26.063, Tax Code;
377	377	(8) Section 26.075, Tax Code;
378	378	(9) Section 49.23601(b), Water Code;
379	379	(10) Section 49.23602, Water Code; and
380	380	(11) Section 49.23603, Water Code.
381	381	SECTION 17. This Act applies only to ad valorem taxes
382	382	imposed for an ad valorem tax year that begins on or after the
383	383	effective date of this Act.
384	384	SECTION 18. This Act takes effect January 1, 2024.