Texas House Bill HB3564

Texas 2023 - 88th Regular

• Filed: 3/6/23

Caption

Relating to the limitation on increases in the appraised value of a residence homestead for ad valorem tax purposes.

Impact

If enacted, HB3564 would have a significant impact on state tax laws, specifically regarding how residential properties are appraised for tax purposes. The bill is contingent upon the approval of a constitutional amendment that would authorize such limitations on appraisal values. By limiting the taxable increases to a predetermined calculation, it seeks to minimize financial strains on homeowners, particularly in areas experiencing rapid increases in property values. This change could potentially stabilize the tax burden for homeowners and allow for better financial planning and stability within communities.

Summary

House Bill 3564 seeks to limit increases in the appraised value of residence homesteads for ad valorem tax purposes. This legislative proposal aims to provide financial relief to homeowners by restricting the appraisal office's ability to increase the taxable value of homesteads beyond certain thresholds. The proposed limitation is designed to ensure that the appraisal for tax years starting after the bill's effective date only reflects either the previous year's appraised value plus any new improvements or the most recent market value determined by the appraisal office, whichever is lower. This is an effort to protect homeowners from sudden and substantial property tax increases not aligned with actual market conditions.

Sentiment

The general sentiment surrounding HB3564 appears to be supportive among homeowners and advocates for tax relief, viewing it as a necessary step toward managing property tax liabilities more effectively. However, there are concerns about the implications of limiting appraisal increases on local government funding and services, as a reduction in property tax revenue could affect public resources. Legislators discussing the bill may hold divergent views depending on their constituencies' needs, indicating a complex sentiment that includes both approval and caution regarding the bill's broader implications.

Contention

Notable points of contention include discussions on the potential fiscal impact this bill may have on local governments which rely on property taxes for funding essential services. Opponents may argue that maintaining adequate local infrastructure and services could be jeopardized by restricting property tax revenue growth, particularly in fast-developing areas. These debates underscore the tension between providing relief to homeowners and ensuring sustainable funding for local agencies, highlighting the challenges in striking a balance between the two interests.

Texas Constitutional Statutes Affected

Tax Code

• Chapter 23. Appraisal Methods And Procedures
  • Section: 23