| 1 | 1 | | 88R807 DRS-D |
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| 2 | 2 | | By: Blanco S.B. No. 547 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the limitation on increases in the appraised value of a |
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| 8 | 8 | | residence homestead for ad valorem tax purposes. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Section 23.23, Tax Code, is amended by amending |
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| 11 | 11 | | Subsection (a) and adding Subsections (a-1) and (a-2) to read as |
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| 12 | 12 | | follows: |
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| 13 | 13 | | (a) Notwithstanding the requirements of Section 25.18 and |
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| 14 | 14 | | regardless of whether the appraisal office has appraised the |
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| 15 | 15 | | property and determined the market value of the property for the tax |
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| 16 | 16 | | year, an appraisal office may increase the appraised value of a |
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| 17 | 17 | | residence homestead for a tax year to an amount not to exceed the |
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| 18 | 18 | | lesser of: |
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| 19 | 19 | | (1) the market value of the property for the most |
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| 20 | 20 | | recent tax year that the market value was determined by the |
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| 21 | 21 | | appraisal office; or |
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| 22 | 22 | | (2) the sum of: |
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| 23 | 23 | | (A) the lesser of: |
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| 24 | 24 | | (i) 10 percent of the appraised value of the |
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| 25 | 25 | | property for the preceding tax year; or |
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| 26 | 26 | | (ii) the product of the inflation rate for |
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| 27 | 27 | | the preceding tax year as determined under Subsection (a-1), |
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| 28 | 28 | | expressed as a decimal, and the appraised value of the property for |
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| 29 | 29 | | the preceding tax year; |
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| 30 | 30 | | (B) the appraised value of the property for the |
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| 31 | 31 | | preceding tax year; and |
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| 32 | 32 | | (C) the market value of all new improvements to |
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| 33 | 33 | | the property. |
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| 34 | 34 | | (a-1) Not later than March 1 of each tax year, the |
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| 35 | 35 | | comptroller shall determine the inflation rate for the preceding |
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| 36 | 36 | | tax year for purposes of Subsection (a), provide the rate to each |
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| 37 | 37 | | appraisal office, and publish the rate in the Texas Register. |
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| 38 | 38 | | (a-2) In this section: |
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| 39 | 39 | | (1) "Consumer price index" means the average over a |
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| 40 | 40 | | tax year of the index that the comptroller considers to most |
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| 41 | 41 | | accurately report changes in the purchasing power of the dollar for |
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| 42 | 42 | | consumers in this state. |
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| 43 | 43 | | (2) "Inflation rate" means the amount, expressed in |
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| 44 | 44 | | decimal form rounded to the nearest thousandth, computed by |
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| 45 | 45 | | determining the percentage change in the consumer price index for |
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| 46 | 46 | | the preceding tax year as compared to the consumer price index for |
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| 47 | 47 | | the tax year preceding that tax year. |
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| 48 | 48 | | SECTION 2. This Act applies only to the appraisal of a |
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| 49 | 49 | | residence homestead for ad valorem tax purposes for a tax year that |
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| 50 | 50 | | begins on or after the effective date of this Act. |
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| 51 | 51 | | SECTION 3. This Act takes effect January 1, 2024, but only |
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| 52 | 52 | | if the constitutional amendment proposed by the 88th Legislature, |
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| 53 | 53 | | Regular Session, 2023, to authorize the legislature to set a lower |
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| 54 | 54 | | limit on the maximum appraised value of a residence homestead for ad |
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| 55 | 55 | | valorem tax purposes is approved by the voters. If that amendment |
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| 56 | 56 | | is not approved by the voters, this Act has no effect. |
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