Texas 2025 - 89th Regular

Texas House Bill HB774 Compare Versions

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1	1	By: Harrison H.B. No. 774
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6	6	A BILL TO BE ENTITLED
7	7	AN ACT
8	8	relating to municipal and county ad valorem tax relief.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Chapter 140, Local Government Code, is amended
11	11	by adding Section 140.014 to read as follows:
12	12	Sec. 140.014. AD VALOREM TAX RELIEF USING CERTAIN SURPLUS
13	13	REVENUE. (a) In this section:
14	14	(1) "Consumer price index" means the index that the
15	15	comptroller considers to most accurately report changes in the
16	16	purchasing power of the dollar for consumers in this state.
17	17	(2) "Inflation rate" means the amount, expressed in
18	18	decimal form rounded to the nearest thousandth, computed by
19	19	determining the percentage change in the consumer price index for
20	20	the most recent 12-month period for which the index can be
21	21	determined as compared to the consumer price index for the 12-month
22	22	period preceding that period.
23	23	(3) "Population growth rate" means the rate of growth
24	24	of the state's population during the preceding calendar year,
25	25	expressed in decimal form rounded to the nearest thousandth,
26	26	determined by the board in accordance with the most recent
27	27	population estimates published by the United States Census Bureau.
28	28	(4) "Surplus revenue" means the total amount of money
29	29	received by a county or municipality in the preceding fiscal year in
30	30	excess of the amount computed by:
31	31	(A) multiplying the amount of the adopted budget
32	32	of the county or municipality for the preceding fiscal year by the
33	33	sum of 1 and the population growth rate; and
34	34	(B) multiplying the amount computed under
35	35	Paragraph (A) by the sum of 1 and the inflation rate.
36	36	(b) By July 1 or as soon thereafter as practicable, the
37	37	comptroller shall determine the rate of inflation in this state and
38	38	publish that rate in the Texas Register.
39	39	(c) A county or municipality shall use the total amount of
40	40	surplus revenue generated by the county or municipality in the
41	41	preceding fiscal year for ad valorem tax relief in the current
42	42	fiscal year. The relief must be provided in a manner that reduces
43	43	the amount of ad valorem taxes that a property owner would otherwise
44	44	be required to pay.
45	45	SECTION 2. Chapter 26, Tax Code, is amended by adding
46	46	Section 26.046 to read as follows:
47	47	Sec. 26.046. ANNUAL LIMIT ON TAX RATE OF COUNTY OR
48	48	MUNICIPALITY. (a) In this section:
49	49	(1) "Consumer price index" means the index that the
50	50	comptroller considers to most accurately report changes in the
51	51	purchasing power of the dollar for consumers in this state.
52	52	(2) "Inflation rate" means the amount, expressed in
53	53	decimal form rounded to the nearest thousandth, computed by
54	54	determining the percentage change in the consumer price index for
55	55	the most recent 12-month period for which the index can be
56	56	determined as compared to the consumer price index for the 12-month
57	57	period preceding that period.
58	58	(3) "Population growth rate" means the rate of growth
59	59	of the state's population during the preceding calendar year,
60	60	expressed in decimal form rounded to the nearest thousandth,
61	61	determined by the board in accordance with the most recent
62	62	population estimates published by the United States Census Bureau.
63	63	(b) By July 1 or as soon thereafter as practicable, the
64	64	comptroller shall determine the rate of inflation in this state and
65	65	publish that rate in the Texas Register.
66	66	(c) Notwithstanding any other law, including Sections
67	67	26.042 and 26.07, the governing body of a county or municipality
68	68	may not adopt a tax rate for a tax year that exceeds the rate,
69	69	expressed in dollars per $100 of taxable value, computed by:
70	70	(1) multiplying the total amount of money received by
71	71	the county or municipality from all sources during the preceding
72	72	tax year by the sum of 1 and the population growth rate;
73	73	(2) multiplying the amount computed under Subdivision
74	74	(1) by the sum of 1 and the inflation rate;
75	75	(3) subtracting from the amount computed under
76	76	Subdivision (2) the amount of money estimated to be received by the
77	77	county or municipality in the current tax year from all sources
78	78	other than ad valorem taxes; and
79	79	(4) dividing the amount computed under Subdivision (3)
80	80	by the current total value for the county or municipality.
81	81	(d) By August 7 or as soon thereafter as practicable, an
82	82	officer or employee designated by the governing body of a county or
83	83	municipality shall calculate the rate described by Subsection (c)
84	84	and submit the rate to the governing body of the county or
85	85	municipality.
86	86	(e) Notwithstanding Subsection (c), the governing body of a
87	87	county or municipality may adopt a tax rate for a tax year that
88	88	exceeds the rate computed under that subsection if:
89	89	(1) before the adoption of a tax rate for that tax year
90	90	the county or municipality pledged the taxes for payment of a debt;
91	91	and
92	92	(2) adopting a rate less than or equal to the rate
93	93	computed under that subsection would impair the obligation of the
94	94	contract creating the debt.
95	95	SECTION 3. Section 140.014, Local Government Code, as added
96	96	by this Act, applies only to a county or municipal fiscal year that
97	97	begins on or after the effective date of this Act.
98	98	SECTION 4. Section 26.046, Tax Code, as added by this Act,
99	99	applies only to the ad valorem tax rate adopted by a county or
100	100	municipality for an ad valorem tax year that begins on or after the
101	101	effective date of this Act.
102	102	SECTION 5. This Act takes effect January 1, 2025.