Texas 2023 - 88th Regular

Texas Senate Bill SB1324 Compare Versions

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1	1	88R460 CJC-D
2	2	By: Middleton S.B. No. 1324
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the effect of an election at which the voters fail to
8	8	approve or vote to reduce the ad valorem tax rate adopted by the
9	9	governing body of a taxing unit.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Section 26.06(b-1), Tax Code, is amended to read
12	12	as follows:
13	13	(b-1) If the proposed tax rate exceeds the no-new-revenue
14	14	tax rate and the voter-approval tax rate of the taxing unit, the
15	15	notice must contain a statement in the following form:
16	16	"NOTICE OF PUBLIC HEARING ON TAX INCREASE
17	17	"PROPOSED TAX RATE $__________ per $100
18	18	"NO-NEW-REVENUE TAX RATE $__________ per $100
19	19	"VOTER-APPROVAL TAX RATE $__________ per $100
20	20	"The no-new-revenue tax rate is the tax rate for the (current
21	21	tax year) tax year that will raise the same amount of property tax
22	22	revenue for (name of taxing unit) from the same properties in both
23	23	the (preceding tax year) tax year and the (current tax year) tax
24	24	year.
25	25	"The voter-approval tax rate is the highest tax rate that
26	26	(name of taxing unit) may adopt without holding an election to seek
27	27	voter approval of the rate.
28	28	"The proposed tax rate is greater than the no-new-revenue tax
29	29	rate. This means that (name of taxing unit) is proposing to
30	30	increase property taxes for the (current tax year) tax year.
31	31	"A public hearing on the proposed tax rate will be held on
32	32	(date and time) at (meeting place).
33	33	"The proposed tax rate is also greater than the
34	34	voter-approval tax rate. If (name of taxing unit) adopts the
35	35	proposed tax rate, (name of taxing unit) is required to hold an
36	36	election so that the voters may accept or reject the proposed tax
37	37	rate. If a majority of the voters reject the proposed tax rate, the
38	38	tax rate of the (name of taxing unit) will be the lesser of the
39	39	no-new-revenue tax rate or voter-approval tax rate. The election
40	40	will be held on (date of election). You may contact the (name of
41	41	office responsible for administering the election) for information
42	42	about voting locations. The hours of voting on election day are
43	43	(voting hours).
44	44	"Your taxes owed under any of the tax rates mentioned above
45	45	can be calculated as follows:
46	46	"Property tax amount = tax rate x taxable value of your
47	47	property / 100
48	48	"(Names of all members of the governing body, showing how
49	49	each voted on the proposal to consider the tax increase or, if one
50	50	or more were absent, indicating the absences.)
51	51	"Visit Texas.gov/PropertyTaxes to find a link to your local
52	52	property tax database on which you can easily access information
53	53	regarding your property taxes, including information about
54	54	proposed tax rates and scheduled public hearings of each entity
55	55	that taxes your property.
56	56	"The 86th Texas Legislature modified the manner in which the
57	57	voter-approval tax rate is calculated to limit the rate of growth of
58	58	property taxes in the state."
59	59	SECTION 2. Sections 26.063(b) and (c), Tax Code, are
60	60	amended to read as follows:
61	61	(b) This subsection applies only to a taxing unit that is
62	62	required to hold an election under Section 26.07. In the notice
63	63	required to be provided by the taxing unit under Section 26.06(b-1)
64	64	or (b-3), as applicable, the taxing unit shall:
65	65	(1) add the following to the end of the list of rates
66	66	included in the notice:
67	67	"DE MINIMIS RATE $__________ per $100";
68	68	(2) substitute the following for the definition of
69	69	"voter-approval tax rate": "The voter-approval tax rate is the
70	70	highest tax rate that (name of taxing unit) may adopt without
71	71	holding an election to seek voter approval of the rate, unless the
72	72	de minimis rate for (name of taxing unit) exceeds the
73	73	voter-approval tax rate for (name of taxing unit).";
74	74	(3) add the following definition of "de minimis
75	75	rate": "The de minimis rate is the rate equal to the sum of the
76	76	no-new-revenue maintenance and operations rate for (name of taxing
77	77	unit), the rate that will raise $500,000, and the current debt rate
78	78	for (name of taxing unit)."; and
79	79	(4) substitute the following for the provision that
80	80	provides notice that an election is required: "The proposed tax
81	81	rate is greater than the voter-approval tax rate and the de minimis
82	82	rate. If (name of taxing unit) adopts the proposed tax rate, (name
83	83	of taxing unit) is required to hold an election so that the voters
84	84	may accept or reject the proposed tax rate. If a majority of the
85	85	voters reject the proposed tax rate, the tax rate of the (name of
86	86	taxing unit) will be the lesser of the no-new-revenue tax rate or
87	87	voter-approval tax rate of the (name of taxing unit). The election
88	88	will be held on (date of election). You may contact the (name of
89	89	office responsible for administering the election) for information
90	90	about voting locations. The hours of voting on election day are
91	91	(voting hours).".
92	92	(c) This subsection applies only to a taxing unit for which
93	93	the qualified voters of the taxing unit may petition to hold an
94	94	election under Section 26.075. In the notice required to be
95	95	provided by the taxing unit under Section 26.06(b-1) or (b-3), as
96	96	applicable, the taxing unit shall:
97	97	(1) add the following to the end of the list of rates
98	98	included in the notice:
99	99	"DE MINIMIS RATE $__________ per $100";
100	100	(2) substitute the following for the definition of
101	101	"voter-approval tax rate": "The voter-approval tax rate is the
102	102	highest tax rate that (name of taxing unit) may adopt without
103	103	holding an election to seek voter approval of the rate, unless the
104	104	de minimis rate for (name of taxing unit) exceeds the
105	105	voter-approval tax rate for (name of taxing unit).";
106	106	(3) add the following definition of "de minimis
107	107	rate": "The de minimis rate is the rate equal to the sum of the
108	108	no-new-revenue maintenance and operations rate for (name of taxing
109	109	unit), the rate that will raise $500,000, and the current debt rate
110	110	for (name of taxing unit)."; and
111	111	(4) substitute the following for the provision that
112	112	provides notice that an election is required: "The proposed tax
113	113	rate is greater than the voter-approval tax rate but not greater
114	114	than the de minimis rate. However, the proposed tax rate exceeds
115	115	the rate that allows voters to petition for an election under
116	116	Section 26.075, Tax Code. If (name of taxing unit) adopts the
117	117	proposed tax rate, the qualified voters of the (name of taxing unit)
118	118	may petition the (name of taxing unit) to require an election to be
119	119	held to determine whether to reduce the proposed tax rate. If a
120	120	majority of the voters reject the proposed tax rate, the tax rate of
121	121	the (name of taxing unit) will be the lesser of the no-new-revenue
122	122	tax rate or voter-approval tax rate of the (name of taxing unit).".
123	123	SECTION 3. Sections 26.07(e) and (g), Tax Code, are amended
124	124	to read as follows:
125	125	(e) If the proposition is not approved as provided by
126	126	Subsection (d), the taxing unit's tax rate for the current tax year
127	127	is the lesser of the taxing unit's no-new-revenue tax rate or
128	128	voter-approval tax rate.
129	129	(g) If a property owner pays taxes calculated using the
130	130	originally adopted tax rate of the taxing unit and the proposition
131	131	to approve the adopted tax rate is not approved by voters, the
132	132	taxing unit shall refund the difference between the amount of taxes
133	133	paid and the amount due under the no-new-revenue tax rate or
134	134	voter-approval tax rate, as applicable, if the difference between
135	135	the amount of taxes paid and the amount due under the applicable
136	136	[voter-approval] tax rate is $1 or more. If the difference between
137	137	the amount of taxes paid and the amount due under the applicable
138	138	[voter-approval] tax rate is less than $1, the taxing unit shall
139	139	refund the difference on request of the taxpayer. An application
140	140	for a refund of less than $1 must be made within 90 days after the
141	141	date the refund becomes due or the taxpayer forfeits the right to
142	142	the refund.
143	143	SECTION 4. Sections 26.075(c), (g), and (h), Tax Code, are
144	144	amended to read as follows:
145	145	(c) The qualified voters of a taxing unit by petition may
146	146	require that an election be held to determine whether to reduce the
147	147	tax rate adopted by the governing body of the taxing unit for the
148	148	current tax year to the lesser of the taxing unit's no-new-revenue
149	149	tax rate or voter-approval tax rate.
150	150	(g) At the election, the ballots shall be prepared to permit
151	151	voting for or against the proposition: "Reducing the tax rate in
152	152	(name of taxing unit) for the current year from (insert tax rate
153	153	adopted for current year) to (insert lesser of no-new-revenue tax
154	154	rate or voter-approval tax rate)."
155	155	(h) If a majority of the votes cast in the election favor the
156	156	proposition, the tax rate for the current tax year is the lesser of
157	157	the taxing unit's no-new-revenue tax rate or voter-approval tax
158	158	rate.
159	159	SECTION 5. Section 26.08(d), Tax Code, is amended to read as
160	160	follows:
161	161	(d) If the proposition is not approved as provided by
162	162	Subsection (c), the governing body may not adopt a tax rate for the
163	163	school district for the current year that exceeds the lesser of the
164	164	school district's no-new-revenue tax rate or voter-approval tax
165	165	rate.
166	166	SECTION 6. Section 49.236(a), Water Code, is amended to
167	167	read as follows:
168	168	(a) Before the board adopts an ad valorem tax rate for the
169	169	district for debt service, operation and maintenance purposes, or
170	170	contract purposes, the board shall give notice of each meeting of
171	171	the board at which the adoption of a tax rate will be considered.
172	172	The notice must:
173	173	(1) contain a statement in substantially the following
174	174	form:
175	175	"NOTICE OF PUBLIC HEARING ON TAX RATE
176	176	"The (name of the district) will hold a public hearing on a
177	177	proposed tax rate for the tax year (year of tax levy) on (date and
178	178	time) at (meeting place). Your individual taxes may increase at a
179	179	greater or lesser rate, or even decrease, depending on the tax rate
180	180	that is adopted and on the change in the taxable value of your
181	181	property in relation to the change in taxable value of all other
182	182	property. The change in the taxable value of your property in
183	183	relation to the change in the taxable value of all other property
184	184	determines the distribution of the tax burden among all property
185	185	owners.
186	186	"Visit Texas.gov/PropertyTaxes to find a link to your local
187	187	property tax database on which you can easily access information
188	188	regarding your property taxes, including information about
189	189	proposed tax rates and scheduled public hearings of each entity
190	190	that taxes your property.
191	191	"(Names of all board members and, if a vote was taken, an
192	192	indication of how each voted on the proposed tax rate and an
193	193	indication of any absences.)";
194	194	(2) contain the following information:
195	195	(A) the district's total adopted tax rate for the
196	196	preceding year and the proposed tax rate, expressed as an amount per
197	197	$100;
198	198	(B) the difference, expressed as an amount per
199	199	$100 and as a percent increase or decrease, as applicable, in the
200	200	proposed tax rate compared to the adopted tax rate for the preceding
201	201	year;
202	202	(C) the average appraised value of a residence
203	203	homestead in the district in the preceding year and in the current
204	204	year; the district's total homestead exemption, other than an
205	205	exemption available only to disabled persons or persons 65 years of
206	206	age or older, applicable to that appraised value in each of those
207	207	years; and the average taxable value of a residence homestead in the
208	208	district in each of those years, disregarding any homestead
209	209	exemption available only to disabled persons or persons 65 years of
210	210	age or older;
211	211	(D) the amount of tax that would have been
212	212	imposed by the district in the preceding year on a residence
213	213	homestead appraised at the average appraised value of a residence
214	214	homestead in that year, disregarding any homestead exemption
215	215	available only to disabled persons or persons 65 years of age or
216	216	older;
217	217	(E) the amount of tax that would be imposed by the
218	218	district in the current year on a residence homestead appraised at
219	219	the average appraised value of a residence homestead in that year,
220	220	disregarding any homestead exemption available only to disabled
221	221	persons or persons 65 years of age or older, if the proposed tax
222	222	rate is adopted;
223	223	(F) the difference between the amounts of tax
224	224	calculated under Paragraphs (D) and (E), expressed in dollars and
225	225	cents and described as the annual percentage increase or decrease,
226	226	as applicable, in the tax to be imposed by the district on the
227	227	average residence homestead in the district in the current year if
228	228	the proposed tax rate is adopted; and
229	229	(G) if the proposed combined debt service,
230	230	operation and maintenance, and contract tax rate requires or
231	231	authorizes an election to approve or reduce the tax rate, as
232	232	applicable, a description of the purpose of the proposed tax
233	233	increase;
234	234	(3) contain a statement in substantially the following
235	235	form, as applicable:
236	236	(A) if the district is a district described by
237	237	Section 49.23601:
238	238	"NOTICE OF VOTE ON TAX RATE
239	239	"If the district adopts a combined debt service, operation
240	240	and maintenance, and contract tax rate that would result in the
241	241	taxes on the average residence homestead increasing by more than
242	242	eight percent, an election must be held to determine whether to
243	243	approve the operation and maintenance tax rate under Section
244	244	49.23601, Water Code.";
245	245	(B) if the district is a district described by
246	246	Section 49.23602:
247	247	"NOTICE OF VOTE ON TAX RATE
248	248	"If the district adopts a combined debt service, operation
249	249	and maintenance, and contract tax rate that would result in the
250	250	taxes on the average residence homestead increasing by more than
251	251	3.5 percent, an election must be held to determine whether to
252	252	approve the operation and maintenance tax rate under Section
253	253	49.23602, Water Code."; or
254	254	(C) if the district is a district described by
255	255	Section 49.23603:
256	256	"NOTICE OF TAXPAYERS' RIGHT TO ELECTION TO REDUCE TAX RATE
257	257	"If the district adopts a combined debt service, operation
258	258	and maintenance, and contract tax rate that would result in the
259	259	taxes on the average residence homestead increasing by more than
260	260	eight percent, the qualified voters of the district by petition may
261	261	require that an election be held to determine whether to reduce the
262	262	operation and maintenance tax rate [to the voter-approval tax rate]
263	263	under Section 49.23603, Water Code."; and
264	264	(4) include the following statement: "The 86th Texas
265	265	Legislature modified the manner in which the voter-approval tax
266	266	rate is calculated to limit the rate of growth of property taxes in
267	267	the state.".
268	268	SECTION 7. Sections 49.23601(a) and (c), Water Code, are
269	269	amended to read as follows:
270	270	(a) In this section:
271	271	(1) "No-new-revenue tax rate" has the meaning assigned
272	272	by Section 26.04(c), Tax Code.
273	273	(2) "Voter-approval [, "voter-approval] tax rate"
274	274	means the rate equal to the sum of the following tax rates for the
275	275	district:
276	276	(A) [(1)] the current year's debt service tax
277	277	rate;
278	278	(B) [(2)] the current year's contract tax rate;
279	279	and
280	280	(C) [(3)] the operation and maintenance tax rate
281	281	that would impose 1.08 times the amount of the operation and
282	282	maintenance tax imposed by the district in the preceding year on a
283	283	residence homestead appraised at the average appraised value of a
284	284	residence homestead in the district in that year, disregarding any
285	285	homestead exemption available only to disabled persons or persons
286	286	65 years of age or older.
287	287	(c) If the board of a district adopts a combined debt
288	288	service, contract, and operation and maintenance tax rate that
289	289	would impose more than 1.08 times the amount of tax imposed by the
290	290	district in the preceding year on a residence homestead appraised
291	291	at the average appraised value of a residence homestead in the
292	292	district in that year, disregarding any homestead exemption
293	293	available only to disabled persons or persons 65 years of age or
294	294	older, an election must be held in accordance with the procedures
295	295	provided by Sections 26.07(c)-(g), Tax Code, to determine whether
296	296	to approve the adopted tax rate. If the adopted tax rate is not
297	297	approved at the election, the district's tax rate is the lesser of
298	298	the district's no-new-revenue tax rate or voter-approval tax rate.
299	299	SECTION 8. Section 49.23602(a), Water Code, is amended by
300	300	adding Subdivision (2-a) to read as follows:
301	301	(2-a) "No-new-revenue tax rate" has the meaning
302	302	assigned by Section 26.04(c), Tax Code.
303	303	SECTION 9. Section 49.23602(c), Water Code, is amended to
304	304	read as follows:
305	305	(c) If the board of a district adopts a combined debt
306	306	service, contract, and operation and maintenance tax rate that
307	307	exceeds the district's mandatory tax election rate, an election
308	308	must be held in accordance with the procedures provided by Sections
309	309	26.07(c)-(g), Tax Code, to determine whether to approve the adopted
310	310	tax rate. If the adopted tax rate is not approved at the election,
311	311	the district's tax rate is the lesser of the district's
312	312	no-new-revenue tax rate or voter-approval tax rate.
313	313	SECTION 10. Sections 49.23603(a) and (c), Water Code, are
314	314	amended to read as follows:
315	315	(a) In this section:
316	316	(1) "No-new-revenue tax rate" has the meaning assigned
317	317	by Section 26.04(c), Tax Code.
318	318	(2) "Voter-approval [, "voter-approval] tax rate"
319	319	means the rate equal to the sum of the following tax rates for the
320	320	district:
321	321	(A) [(1)] the current year's debt service tax
322	322	rate;
323	323	(B) [(2)] the current year's contract tax rate;
324	324	and
325	325	(C) [(3)] the operation and maintenance tax rate
326	326	that would impose 1.08 times the amount of the operation and
327	327	maintenance tax imposed by the district in the preceding year on a
328	328	residence homestead appraised at the average appraised value of a
329	329	residence homestead in the district in that year, disregarding any
330	330	homestead exemption available only to disabled persons or persons
331	331	65 years of age or older.
332	332	(c) If the board of a district adopts a combined debt
333	333	service, contract, and operation and maintenance tax rate that
334	334	would impose more than 1.08 times the amount of tax imposed by the
335	335	district in the preceding year on a residence homestead appraised
336	336	at the average appraised value of a residence homestead in the
337	337	district in that year, disregarding any homestead exemption
338	338	available only to disabled persons or persons 65 years of age or
339	339	older, the qualified voters of the district by petition may require
340	340	that an election be held to determine whether to reduce the tax rate
341	341	adopted for the current year to the lesser of the district's
342	342	no-new-revenue tax rate or voter-approval tax rate in accordance
343	343	with the procedures provided by Sections 26.075 and 26.081, Tax
344	344	Code.
345	345	SECTION 11. The change in law made by this Act applies to
346	346	the ad valorem tax rate of a taxing unit beginning with the 2024 tax
347	347	year.
348	348	SECTION 12. This Act takes effect January 1, 2024.