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Texas House Bill HB1035

Texas 2025 - 89th Regular

Texas House Bill HB1035 Compare Versions

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1-89R20799 CJC-F
21 By: Talarico H.B. No. 1035
3- Substitute the following for H.B. No. 1035:
4- By: Martinez Fischer C.S.H.B. No. 1035
2+
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76 A BILL TO BE ENTITLED
87 AN ACT
9- relating to the contents of an affidavit required to be included
10- with an application for an exemption from ad valorem taxation of all
11- or part of the appraised value of real property used to operate a
12- child-care facility.
8+ relating to the criteria for a local option exemption from ad
9+ valorem taxation by a county or municipality of all or part of the
10+ appraised value of real property used to operate a child-care
11+ facility.
1312 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
14- SECTION 1. Section 11.36(a), Tax Code, as added by Chapter
15- 281 (S.B. 1145), Acts of the 88th Legislature, Regular Session,
16- 2023, is amended by amending Subdivision (2) and adding Subdivision
17- (3) to read as follows:
18- (2) "Net lease" means a lease under which the lessee
19- pays, in addition to a base rental amount, the taxes imposed on the
20- property that is the subject of the lease. The term includes a
21- double net lease and a triple net lease.
22- (3) "Qualifying child-care facility" means a
13+ SECTION 1. Section 11.36, Tax Code, is amended by amending
14+ subsections (a) and (f) to read as follows:
15+ (a) In this section:
16+ (1) "Child-care facility" means a facility licensed by
17+ the Health and Human Services Commission to provide assessment,
18+ care, training, education, custody, treatment, or supervision for a
19+ child who is not related by blood, marriage, or adoption to the
20+ owner or operator of the facility, for all or part of the 24-hour
21+ day, whether or not the facility is operated for profit or charges
22+ for the services it offers.
23+ (2) "Qualifying child-care facility" means a
2324 child-care facility:
2425 (A) the owner or operator of which participates
2526 in the Texas Workforce Commission's Texas Rising Star Program as
2627 described by Section 2308.3155, Government Code, for that facility;
2728 and
2829 (B) at which at least 20 percent of the total
2930 number of children enrolled at the facility receive subsidized
3031 child-care services provided through the child-care services
3132 program administered by the Texas Workforce Commission.
32- SECTION 2. Section 11.36(f), Tax Code, as added by Chapter
33- 281 (S.B. 1145), Acts of the 88th Legislature, Regular Session,
34- 2023, is amended to read as follows:
33+ (3) "Net lease" means a lease in which the lessee pays
34+ rent plus the ad valorem taxes for the property. The term "net
35+ lease" includes a triple net or net-net-net lease.
3536 (f) A person who claims an exemption under Subsection (b)(2)
3637 must include with the application for the exemption an affidavit
3738 certifying to the chief appraiser for the appraisal district that
3839 appraises the property that is the subject of the application that:
39- (1) either:
40- (A) the person has provided to the child-care
41- facility to which the property is leased a disclosure document
42- stating the amount by which the taxes on the property are reduced as
43- a result of the exemption and the method the person will implement
44- to ensure that the rent charged for the lease of the property fully
45- reflects that reduction; or
46- (B) the property is subject to a net lease and the
47- child-care facility to which the property is leased is responsible
48- for paying the taxes imposed on the property;
49- (2) the rent charged for the lease of the property
50- reflects the reduction in the amount of taxes on the property
51- resulting from the exemption, either through a monthly or annual
52- credit against the rent or, if applicable, by operation of the net
53- lease to which the property is subject; and
40+ (1) the person has provided to the child-care facility
41+ to which the property is leased a disclosure document stating the
42+ amount by which the taxes on the property are reduced as a result of
43+ the exemption and the method the person will implement to ensure
44+ that the rent charged for the lease of the property fully reflects
45+ that reduction, including by certifying that the property is
46+ subject to a net lease under which the lessee is directly
47+ responsible for the payment of ad valorem taxes imposed on the
48+ property;
49+ (2) either:
50+ (A) the property is subject to a net lease under
51+ which the lessee is directly responsible for the payment of ad
52+ valorem taxes imposed on the property; or
53+ (B) the rent charged for the lease of the
54+ property reflects the reduction in the amount of taxes on the
55+ property resulting from the exemption through a monthly or annual
56+ credit against the rent; and
5457 (3) the person does not charge rent for the lease of
5558 the property in an amount that exceeds:
5659 (A) for property that consists of space in a
5760 commercial property, the rent charged by the person to other
5861 tenants of the commercial property for similar space; or
5962 (B) for property other than property described by
6063 Paragraph (A), the average rent charged for comparable rental
6164 property.
62- SECTION 3. The change in law made by this Act applies only
63- to an application for an exemption from ad valorem taxation under
64- Section 11.36, Tax Code, as added by Chapter 281 (S.B. 1145), Acts
65- of the 88th Legislature, Regular Session, 2023, that is filed on or
66- after the effective date of this Act. An application for an
67- exemption from ad valorem taxation under that section that was
68- filed before the effective date of this Act is covered by the law in
69- effect on the date the application was filed, and the former law is
70- continued in effect for that purpose.
71- SECTION 4. To the extent of any conflict, this Act prevails
72- over another Act of the 89th Legislature, Regular Session, 2025,
73- relating to nonsubstantive additions to and corrections in enacted
74- codes.
75- SECTION 5. This Act takes effect immediately if it receives
65+ SECTION 2. This Act takes effect immediately if it receives
7666 a vote of two-thirds of all the members elected to each house, as
7767 provided by Section 39, Article III, Texas Constitution. If this
7868 Act does not receive the vote necessary for immediate effect, this
7969 Act takes effect September 1, 2025.