Texas 2023 - 88th Regular

Texas House Bill HB4261 Compare Versions

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1	1	88R4342 LHC-D
2	2	By: Cook H.B. No. 4261
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to a limitation on increases in the appraised value for ad
8	8	valorem tax purposes of the residence homesteads of military
9	9	veterans, individuals who are disabled or 65 years of age or older,
10	10	and their surviving spouses.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Section 1.12(d), Tax Code, is amended to read as
13	13	follows:
14	14	(d) For purposes of this section, the appraisal ratio of a
15	15	homestead to which Section 23.23 or 23.231 applies is the ratio of
16	16	the property's market value as determined by the appraisal district
17	17	or appraisal review board, as applicable, to the market value of the
18	18	property according to law. The appraisal ratio is not calculated
19	19	according to the appraised value of the property as limited by
20	20	Section 23.23 or 23.231.
21	21	SECTION 2. Subchapter B, Chapter 23, Tax Code, is amended by
22	22	adding Section 23.231 to read as follows:
23	23	Sec. 23.231. LIMITATION ON APPRAISED VALUE OF RESIDENCE
24	24	HOMESTEADS OF CERTAIN INDIVIDUALS. (a) In this section:
25	25	(1) "Disaster recovery program" means the disaster
26	26	recovery program administered by the General Land Office or by a
27	27	political subdivision of this state that is funded with community
28	28	development block grant disaster recovery money authorized by
29	29	federal law.
30	30	(2) "New improvement" means an improvement to a
31	31	residence homestead made after the most recent appraisal of the
32	32	property that increases the market value of the property and the
33	33	value of which is not included in the appraised value of the
34	34	property for the preceding tax year. The term does not include
35	35	repairs to or ordinary maintenance of an existing structure or the
36	36	grounds or another feature of the property.
37	37	(3) "Residence homestead" has the meaning assigned by
38	38	Section 11.13.
39	39	(4) "Veteran" means an individual who:
40	40	(A) has served in:
41	41	(i) an active or reserve component of the
42	42	army, navy, air force, coast guard, or marine corps of the United
43	43	States; or
44	44	(ii) the Texas National Guard, as defined
45	45	by Section 431.001, Government Code; and
46	46	(B) has been discharged or released from the
47	47	branch of the service in which the individual served under
48	48	conditions other than dishonorable.
49	49	(b) This section applies only to a residence homestead owned
50	50	by:
51	51	(1) a veteran;
52	52	(2) an individual who receives an exemption under
53	53	Section 11.13(c); or
54	54	(3) the surviving spouse of a person described by
55	55	Subdivision (1) or (2).
56	56	(c) Notwithstanding the requirements of Sections 23.23 and
57	57	25.18, and regardless of whether the appraisal office has appraised
58	58	the property and determined the market value of the property for the
59	59	tax year, an appraisal office may increase the appraised value of a
60	60	residence homestead to which this section applies for a tax year to
61	61	an amount not to exceed the lowest of:
62	62	(1) the market value of the property for the most
63	63	recent tax year that the market value was determined by the
64	64	appraisal office;
65	65	(2) the sum of:
66	66	(A) the appraised value of the property for the
67	67	tax year in which the owner first qualified the property for the
68	68	limitation provided by this section; and
69	69	(B) the market value of all new improvements to
70	70	the property; or
71	71	(3) the sum of:
72	72	(A) the appraised value of the property for the
73	73	preceding tax year; and
74	74	(B) the market value of all new improvements to
75	75	the property.
76	76	(d) When appraising a residence homestead to which this
77	77	section applies, the chief appraiser shall:
78	78	(1) appraise the property at its market value; and
79	79	(2) include in the appraisal records both the market
80	80	value of the property and the amounts computed under Subsections
81	81	(c)(2) and (3).
82	82	(e) The limitation provided by Subsection (c) takes effect
83	83	as to a residence homestead on January 1 of the tax year following
84	84	the first tax year in which the owner owns the property on January 1
85	85	and in which the owner qualifies the property for the
86	86	limitation. The limitation expires on January 1 of the first tax
87	87	year that neither the owner of the property when the limitation took
88	88	effect nor the owner's spouse or surviving spouse qualifies for the
89	89	limitation.
90	90	(f) For purposes of Subsection (e), a person who acquired a
91	91	residence homestead to which this section applies before the 2023
92	92	tax year is considered to have acquired the property on January 1,
93	93	2023.
94	94	(g) This section does not apply to property appraised under
95	95	Subchapter C, D, E, F, or G.
96	96	(h) Notwithstanding Subsection (c), and except as provided
97	97	by Subdivision (2), an improvement to property that would otherwise
98	98	constitute a new improvement is not treated as a new improvement if
99	99	the improvement is a replacement structure for a structure that was
100	100	rendered uninhabitable or unusable by a casualty or by wind, fire,
101	101	or water damage. For purposes of appraising the property under
102	102	Subsection (c) in the tax year in which the structure would have
103	103	constituted a new improvement:
104	104	(1) the appraised value the property would have had in
105	105	the preceding tax year if the casualty or damage had not occurred is
106	106	considered to be the appraised value of the property for that year,
107	107	regardless of whether that appraised value exceeds the actual
108	108	appraised value of the property for that year as limited by
109	109	Subsection (c); and
110	110	(2) the replacement structure is considered to be a
111	111	new improvement only if:
112	112	(A) the square footage of the replacement
113	113	structure exceeds that of the replaced structure as that structure
114	114	existed before the casualty or damage occurred; or
115	115	(B) the exterior of the replacement structure is
116	116	of higher quality construction and composition than that of the
117	117	replaced structure.
118	118	(i) Notwithstanding Subsection (h)(2), and only to the
119	119	extent necessary to satisfy the requirements of a disaster recovery
120	120	program, a replacement structure described by that subdivision is
121	121	not considered to be a new improvement if to satisfy the
122	122	requirements of the disaster recovery program it was necessary
123	123	that:
124	124	(1) the square footage of the replacement structure
125	125	exceed that of the replaced structure as that structure existed
126	126	before the casualty or damage occurred; or
127	127	(2) the exterior of the replacement structure be of
128	128	higher quality construction and composition than that of the
129	129	replaced structure.
130	130	(j) To receive a limitation under Subsection (c), a person
131	131	claiming the limitation must apply for the limitation by filing an
132	132	application with the chief appraiser of the appraisal
133	133	district. The application must be filed not later than May 1 of the
134	134	year for which the person claims the limitation. The chief
135	135	appraiser shall accept and approve or deny an application. For
136	136	property appraised by more than one appraisal district, a separate
137	137	application must be filed in each appraisal district to receive the
138	138	limitation in that district.
139	139	(k) A limitation provided by Subsection (c), once allowed,
140	140	need not be claimed in subsequent years and applies to the property
141	141	until the limitation expires as provided by this section or until
142	142	the person's qualification for the limitation ends. However, the
143	143	chief appraiser may require a person allowed a limitation in a prior
144	144	year to file a new application to confirm the person's current
145	145	qualification for the limitation by delivering not later than April
146	146	1 a written notice that a new application is required, accompanied
147	147	by an appropriate application form, to the person previously
148	148	allowed the limitation.
149	149	(l) The comptroller, in prescribing the contents of the
150	150	application form for a limitation under Subsection (c), shall
151	151	ensure that the form requires an applicant to provide the
152	152	information necessary to determine the validity of the limitation
153	153	claim.
154	154	SECTION 3. Section 41.41(a), Tax Code, is amended to read as
155	155	follows:
156	156	(a) A property owner is entitled to protest before the
157	157	appraisal review board the following actions:
158	158	(1) determination of the appraised value of the
159	159	owner's property or, in the case of land appraised as provided by
160	160	Subchapter C, D, E, or H, Chapter 23, determination of its appraised
161	161	or market value;
162	162	(2) unequal appraisal of the owner's property;
163	163	(3) inclusion of the owner's property on the appraisal
164	164	records;
165	165	(4) denial to the property owner in whole or in part of
166	166	a partial exemption;
167	167	(4-a) determination that the owner's property does not
168	168	qualify for the limitation on appraised value provided by Section
169	169	23.231;
170	170	(5) determination that the owner's land does not
171	171	qualify for appraisal as provided by Subchapter C, D, E, or H,
172	172	Chapter 23;
173	173	(6) identification of the taxing units in which the
174	174	owner's property is taxable in the case of the appraisal district's
175	175	appraisal roll;
176	176	(7) determination that the property owner is the owner
177	177	of property;
178	178	(8) a determination that a change in use of land
179	179	appraised under Subchapter C, D, E, or H, Chapter 23, has occurred;
180	180	or
181	181	(9) any other action of the chief appraiser, appraisal
182	182	district, or appraisal review board that applies to and adversely
183	183	affects the property owner.
184	184	SECTION 4. Section 42.26(d), Tax Code, is amended to read as
185	185	follows:
186	186	(d) For purposes of this section, the value of the property
187	187	subject to the suit and the value of a comparable property or sample
188	188	property that is used for comparison must be the market value
189	189	determined by the appraisal district when the property is a
190	190	residence homestead subject to the limitation on appraised value
191	191	imposed by Section 23.23 or 23.231.
192	192	SECTION 5. Sections 403.302(d) and (i), Government Code,
193	193	are amended to read as follows:
194	194	(d) For the purposes of this section, "taxable value" means
195	195	the market value of all taxable property less:
196	196	(1) the total dollar amount of any residence homestead
197	197	exemptions lawfully granted under Section 11.13(b) or (c), Tax
198	198	Code, in the year that is the subject of the study for each school
199	199	district;
200	200	(2) one-half of the total dollar amount of any
201	201	residence homestead exemptions granted under Section 11.13(n), Tax
202	202	Code, in the year that is the subject of the study for each school
203	203	district;
204	204	(3) the total dollar amount of any exemptions granted
205	205	before May 31, 1993, within a reinvestment zone under agreements
206	206	authorized by Chapter 312, Tax Code;
207	207	(4) subject to Subsection (e), the total dollar amount
208	208	of any captured appraised value of property that:
209	209	(A) is within a reinvestment zone created on or
210	210	before May 31, 1999, or is proposed to be included within the
211	211	boundaries of a reinvestment zone as the boundaries of the zone and
212	212	the proposed portion of tax increment paid into the tax increment
213	213	fund by a school district are described in a written notification
214	214	provided by the municipality or the board of directors of the zone
215	215	to the governing bodies of the other taxing units in the manner
216	216	provided by former Section 311.003(e), Tax Code, before May 31,
217	217	1999, and within the boundaries of the zone as those boundaries
218	218	existed on September 1, 1999, including subsequent improvements to
219	219	the property regardless of when made;
220	220	(B) generates taxes paid into a tax increment
221	221	fund created under Chapter 311, Tax Code, under a reinvestment zone
222	222	financing plan approved under Section 311.011(d), Tax Code, on or
223	223	before September 1, 1999; and
224	224	(C) is eligible for tax increment financing under
225	225	Chapter 311, Tax Code;
226	226	(5) the total dollar amount of any captured appraised
227	227	value of property that:
228	228	(A) is within a reinvestment zone:
229	229	(i) created on or before December 31, 2008,
230	230	by a municipality with a population of less than 18,000; and
231	231	(ii) the project plan for which includes
232	232	the alteration, remodeling, repair, or reconstruction of a
233	233	structure that is included on the National Register of Historic
234	234	Places and requires that a portion of the tax increment of the zone
235	235	be used for the improvement or construction of related facilities
236	236	or for affordable housing;
237	237	(B) generates school district taxes that are paid
238	238	into a tax increment fund created under Chapter 311, Tax Code; and
239	239	(C) is eligible for tax increment financing under
240	240	Chapter 311, Tax Code;
241	241	(6) the total dollar amount of any exemptions granted
242	242	under Section 11.251 or 11.253, Tax Code;
243	243	(7) the difference between the comptroller's estimate
244	244	of the market value and the productivity value of land that
245	245	qualifies for appraisal on the basis of its productive capacity,
246	246	except that the productivity value estimated by the comptroller may
247	247	not exceed the fair market value of the land;
248	248	(8) the portion of the appraised value of residence
249	249	homesteads of individuals who receive a tax limitation under
250	250	Section 11.26, Tax Code, on which school district taxes are not
251	251	imposed in the year that is the subject of the study, calculated as
252	252	if the residence homesteads were appraised at the full value
253	253	required by law;
254	254	(9) a portion of the market value of property not
255	255	otherwise fully taxable by the district at market value because of
256	256	action required by statute or the constitution of this state, other
257	257	than Section 11.311, Tax Code, that, if the tax rate adopted by the
258	258	district is applied to it, produces an amount equal to the
259	259	difference between the tax that the district would have imposed on
260	260	the property if the property were fully taxable at market value and
261	261	the tax that the district is actually authorized to impose on the
262	262	property, if this subsection does not otherwise require that
263	263	portion to be deducted;
264	264	(10) the market value of all tangible personal
265	265	property, other than manufactured homes, owned by a family or
266	266	individual and not held or used for the production of income;
267	267	(11) the appraised value of property the collection of
268	268	delinquent taxes on which is deferred under Section 33.06, Tax
269	269	Code;
270	270	(12) the portion of the appraised value of property
271	271	the collection of delinquent taxes on which is deferred under
272	272	Section 33.065, Tax Code;
273	273	(13) the amount by which the market value of a
274	274	residence homestead to which Section 23.23 or 23.231, Tax Code,
275	275	applies exceeds the appraised value of that property as calculated
276	276	under Section 23.23 or 23.231, Tax Code, as applicable [that
277	277	section]; and
278	278	(14) the total dollar amount of any exemptions granted
279	279	under Section 11.35, Tax Code.
280	280	(i) If the comptroller determines in the study that the
281	281	market value of property in a school district as determined by the
282	282	appraisal district that appraises property for the school district,
283	283	less the total of the amounts and values listed in Subsection (d) as
284	284	determined by that appraisal district, is valid, the comptroller,
285	285	in determining the taxable value of property in the school district
286	286	under Subsection (d), shall for purposes of Subsection (d)(13)
287	287	subtract from the market value as determined by the appraisal
288	288	district of residence homesteads to which Section 23.23 or 23.231,
289	289	Tax Code, applies the amount by which that amount exceeds the
290	290	appraised value of those properties as calculated by the appraisal
291	291	district under Section 23.23 or 23.231, Tax Code, as
292	292	applicable. If the comptroller determines in the study that the
293	293	market value of property in a school district as determined by the
294	294	appraisal district that appraises property for the school district,
295	295	less the total of the amounts and values listed in Subsection (d) as
296	296	determined by that appraisal district, is not valid, the
297	297	comptroller, in determining the taxable value of property in the
298	298	school district under Subsection (d), shall for purposes of
299	299	Subsection (d)(13) subtract from the market value as estimated by
300	300	the comptroller of residence homesteads to which Section 23.23 or
301	301	23.231, Tax Code, applies the amount by which that amount exceeds
302	302	the appraised value of those properties as calculated by the
303	303	appraisal district under Section 23.23 or 23.231, Tax Code, as
304	304	applicable.
305	305	SECTION 6. This Act applies only to the appraisal of
306	306	residence homesteads for ad valorem tax purposes for a tax year that
307	307	begins on or after the effective date of this Act.
308	308	SECTION 7. This Act takes effect January 1, 2024, but only
309	309	if a constitutional amendment proposed by the 88th Legislature,
310	310	Regular Session, 2023, authorizing the legislature to limit the
311	311	appraised value for ad valorem tax purposes of residence homesteads
312	312	of military veterans, individuals who are disabled or 65 years of
313	313	age or older, and their surviving spouses is approved by the
314	314	voters. If such an amendment is not approved by the voters, this
315	315	Act has no effect.