Texas 2025 - 89th Regular

Texas House Bill HB5451 Compare Versions

Version 1 (Old)

Version 2 (New)

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1	1		By: Anchía H.B. No. 5451
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4	6		A BILL TO BE ENTITLED
5	7		AN ACT
6	8		relating to the treatment of certain residence homesteads for
7	9		purposes of the Tax Increment Financing Act.
8	10		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	11		SECTION 1. Section 311.002(1), Tax Code, is amended to read
10	12		as follows:
11	13		(1) "Project costs" means the expenditures made or
12	14		estimated to be made and monetary obligations incurred or estimated
13	15		to be incurred by the municipality or county designating a
14	16		reinvestment zone that are listed in the project plan as costs of
15	17		public works, public improvements, programs, or other projects
16	18		benefiting the zone, plus other costs incidental to those
17	19		expenditures and obligations. "Project costs" include:
18	20		(A) capital costs, including the actual costs of
19	21		the acquisition and construction of public works, public
20	22		improvements, new buildings, structures, and fixtures; the actual
21	23		costs of the acquisition, demolition, alteration, remodeling,
22	24		repair, or reconstruction of existing buildings, structures, and
23	25		fixtures; the actual costs of the remediation of conditions that
24	26		contaminate public or private land or buildings; the actual costs
25	27		of the preservation of the facade of a public or private building;
26	28		the actual costs of the demolition of public or private buildings;
27	29		and the actual costs of the acquisition of land and equipment and
28	30		the clearing and grading of land;
29	31		(B) financing costs, including all interest paid
30	32		to holders of evidences of indebtedness or other obligations issued
31	33		to pay for project costs and any premium paid over the principal
32	34		amount of the obligations because of the redemption of the
33	35		obligations before maturity;
34	36		(C) real property assembly costs;
35	37		(D) professional service costs, including those
36	38		incurred for architectural, planning, engineering, and legal
37	39		advice and services;
38	40		(E) imputed administrative costs, including
39	41		reasonable charges for the time spent by employees of the
40	42		municipality or county in connection with the implementation of a
41	43		project plan;
42	44		(F) relocation costs;
43	45		(G) organizational costs, including the costs of
44	46		conducting environmental impact studies or other studies, the cost
45	47		of publicizing the creation of the zone, and the cost of
46	48		implementing the project plan for the zone;
47	49		(H) interest before and during construction and
48	50		for one year after completion of construction, whether or not
49	51		capitalized;
50	52		(I) the cost of operating the reinvestment zone
51	53		and project facilities;
52	54		(J) the amount of any contributions made by the
53	55		municipality or county from general revenue for the implementation
54	56		of the project plan;
55	57		(K) the costs of school buildings, other
56	58		educational buildings, other educational facilities, or other
57	59		buildings owned by or on behalf of a school district, community
58	60		college district, or other political subdivision of this state;
59	61		[and]
60	62		(L) payments made at the discretion of the
61	63		governing body of the municipality or county that the governing
62	64		body finds necessary or convenient to the creation of the zone or to
63	65		the implementation of the project plans for the zone; and
64	66		(M) payments made as part of a reinvestment zone
65	67		stability program established under Section 311.0111.
66	68		SECTION 2. Section 311.006(a), Tax Code, is amended to read
67	69		as follows:
68	70		(a) A municipality may not designate a reinvestment zone if:
69	71		(1) more than 40 [30] percent of the property in the
70	72		proposed zone[, excluding property that is publicly owned,] is used
71	73		for residential purposes, excluding property that is:
72	74		(A) publicly owned; or
73	75		(B) a residence homestead owned by a legacy
74	76		homeowner, as those terms are defined by Section 311.0111; or
75	77		(2) the total appraised value of taxable real property
76	78		in the proposed zone and in existing reinvestment zones exceeds:
77	79		(A) 25 percent of the total appraised value of
78	80		taxable real property in the municipality and in the industrial
79	81		districts created by the municipality, if the municipality has a
80	82		population of 100,000 or more; or
81	83		(B) 50 percent of the total appraised value of
82	84		taxable real property in the municipality and in the industrial
83	85		districts created by the municipality, if the municipality has a
84	86		population of less than 100,000.
85	87		SECTION 3. Chapter 311, Tax Code, is amended by adding
86	88		Section 311.0111 to read as follows:
87	89		Sec. 311.0111. REINVESTMENT ZONE STABILITY PROGRAM. (a)
88	90		In this section:
89	91		(1) "Legacy homeowner" means the owner of a residence
90	92		homestead located in a reinvestment zone who has continuously
91	93		resided in and received an exemption under Section 11.13 for the
92	94		homestead for at least seven years preceding the date the governing
93	95		body of the county or municipality designated the zone in which the
94	96		homestead is located and meets certain conditions imposed under the
95	97		project plan under Section 311.011.
96	98		(2) "Program" means a reinvestment zone stability
97	99		program established under this section.
98	100		(3) "Residence homestead" has the meaning assigned by
99	101		Section 11.13.
100	102		(b) The project plan prepared and adopted by the board of
101	103		directors of a reinvestment zone under Section 311.011 may
102	104		authorize the board of directors to establish a reinvestment zone
103	105		stability program, the purpose of which is to ensure that all
104	106		residents of the zone benefit from its designation. The governing
105	107		body of the county or municipality that designated the zone and any
106	108		affiliated community organizations may participate in the
107	109		development of the program. As part of a program established under
108	110		this section, the board may dedicate, pledge, or otherwise provide
109	111		for the use of money in the tax increment fund established for the
110	112		zone to prevent homeowner displacement by providing conditional
111	113		annual payments on behalf of legacy homeowners to offset the
112	114		increase in ad valorem taxes imposed on the residence homesteads of
113	115		those homeowners that is attributable to the increase in property
114	116		values associated with the development or redevelopment of property
115	117		in the zone.
116	118		(c) If the project plan for a reinvestment zone authorizes
117	119		annual payments on behalf of legacy homeowners, the plan must
118	120		provide that:
119	121		(1) the legacy homeowner must meet and maintain
120	122		certain conditions, including meeting an income eligibility
121	123		requirement;
122	124		(2) the amount of an annual payment made under the
123	125		program on behalf of a legacy homeowner may not exceed the amount
124	126		determined for that homeowner under Subsection (d); and
125	127		(3) the period of time for which annual payments may be
126	128		made on behalf of a legacy homeowner may not exceed 10 years.
127	129		(d) The maximum amount of an annual payment that may be made
128	130		on behalf of a legacy homeowner for a tax year is equal to the
129	131		positive difference, if any, between the following amounts:
130	132		(1) the ad valorem taxes due on the homeowner's
131	133		homestead for that tax year; and
132	134		(2) the ad valorem taxes due on the homeowner's
133	135		homestead for the tax year in which the reinvestment zone in which
134	136		the homestead is located was designated.
135	137		SECTION 4. This Act takes effect September 1, 2025.