By: Talarico H.B. No. 1035
A BILL TO BE ENTITLED
AN ACT
relating to the criteria for a local option exemption from ad
valorem taxation by a county or municipality 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, Tax Code, is amended by amending
subsections (a) and (f) to read as follows:
(a) In this section:
(1) "Child-care facility" means a facility licensed by
the Health and Human Services Commission to provide assessment,
care, training, education, custody, treatment, or supervision for a
child who is not related by blood, marriage, or adoption to the
owner or operator of the facility, for all or part of the 24-hour
day, whether or not the facility is operated for profit or charges
for the services it offers.
(2) "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.
(3) "Net lease" means a lease in which the lessee pays
rent plus the ad valorem taxes for the property. The term "net
lease" includes a triple net or net-net-net lease.
(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) 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, including by certifying that the property is
subject to a net lease under which the lessee is directly
responsible for the payment of ad valorem taxes imposed on the
property;
(2) either:
(A) the property is subject to a net lease under
which the lessee is directly responsible for the payment of ad
valorem taxes imposed on the property; or
(B) the rent charged for the lease of the
property reflects the reduction in the amount of taxes on the
property resulting from the exemption through a monthly or annual
credit against the rent; 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 2. 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.