89R20799 CJC-F
By: Talarico H.B. No. 1035
Substitute the following for H.B. No. 1035:
By: Martinez Fischer C.S.H.B. No. 1035
A BILL TO BE ENTITLED
AN ACT
relating to the contents of an affidavit required to be included
with an application for an exemption from ad valorem taxation of all
or part of the appraised value of real property used to operate a
child-care facility.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 11.36(a), Tax Code, as added by Chapter
281 (S.B. 1145), Acts of the 88th Legislature, Regular Session,
2023, is amended by amending Subdivision (2) and adding Subdivision
(3) to read as follows:
(2) "Net lease" means a lease under which the lessee
pays, in addition to a base rental amount, the taxes imposed on the
property that is the subject of the lease. The term includes a
double net lease and a triple net lease.
(3) "Qualifying child-care facility" means a
child-care facility:
(A) the owner or operator of which participates
in the Texas Workforce Commission's Texas Rising Star Program as
described by Section 2308.3155, Government Code, for that facility;
and
(B) at which at least 20 percent of the total
number of children enrolled at the facility receive subsidized
child-care services provided through the child-care services
program administered by the Texas Workforce Commission.
SECTION 2. Section 11.36(f), Tax Code, as added by Chapter
281 (S.B. 1145), Acts of the 88th Legislature, Regular Session,
2023, is amended to read as follows:
(f) A person who claims an exemption under Subsection (b)(2)
must include with the application for the exemption an affidavit
certifying to the chief appraiser for the appraisal district that
appraises the property that is the subject of the application that:
(1) either:
(A) the person has provided to the child-care
facility to which the property is leased a disclosure document
stating the amount by which the taxes on the property are reduced as
a result of the exemption and the method the person will implement
to ensure that the rent charged for the lease of the property fully
reflects that reduction; or
(B) the property is subject to a net lease and the
child-care facility to which the property is leased is responsible
for paying the taxes imposed on the property;
(2) the rent charged for the lease of the property
reflects the reduction in the amount of taxes on the property
resulting from the exemption, either through a monthly or annual
credit against the rent or, if applicable, by operation of the net
lease to which the property is subject; and
(3) the person does not charge rent for the lease of
the property in an amount that exceeds:
(A) for property that consists of space in a
commercial property, the rent charged by the person to other
tenants of the commercial property for similar space; or
(B) for property other than property described by
Paragraph (A), the average rent charged for comparable rental
property.
SECTION 3. The change in law made by this Act applies only
to an application for an exemption from ad valorem taxation under
Section 11.36, Tax Code, as added by Chapter 281 (S.B. 1145), Acts
of the 88th Legislature, Regular Session, 2023, that is filed on or
after the effective date of this Act. An application for an
exemption from ad valorem taxation under that section that was
filed before the effective date of this Act is covered by the law in
effect on the date the application was filed, and the former law is
continued in effect for that purpose.
SECTION 4. To the extent of any conflict, this Act prevails
over another Act of the 89th Legislature, Regular Session, 2025,
relating to nonsubstantive additions to and corrections in enacted
codes.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.