89R13864 CS-F
By: Hall S.B. No. 2170
A BILL TO BE ENTITLED
AN ACT
relating to the exemption from ad valorem taxation of property of a
charitable organization that provides financial support for
medical care at certain institutions of higher education.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 11.18(a) and (d), Tax Code, are amended
to read as follows:
(a) An organization that qualifies as a charitable
organization as provided by this section is entitled to an
exemption from taxation of:
(1) the buildings and tangible personal property that:
(A) are owned by the charitable organization; and
(B) except as permitted by Subsection (b), are
used exclusively by qualified charitable organizations;
(2) the real property owned by the charitable
organization consisting of:
(A) an incomplete improvement that:
(i) is under active construction or other
physical preparation; and
(ii) is designed and intended to be used
exclusively by qualified charitable organizations; and
(B) the land on which the incomplete improvement
is located that will be reasonably necessary for the use of the
improvement by qualified charitable organizations; and
(3) if the charitable organization is described by
Subsection (d)(1), (2), (3)(A)(ii), (5), (8), (13), (15), [or]
(19), or (27), the real property owned by the charitable
organization consisting of an interest in a mineral in place,
including a royalty interest, provided that the interest:
(A) is not severed from the surface estate; or
(B) was donated to the charitable organization by
the previous owner of the interest.
(d) A charitable organization must be organized exclusively
to perform religious, charitable, scientific, literary, or
educational purposes and, except as permitted by Subsections (h)
and (l), engage exclusively in performing one or more of the
following charitable functions:
(1) providing medical care without regard to the
beneficiaries' ability to pay, which in the case of a nonprofit
hospital or hospital system means providing charity care and
community benefits in accordance with Section 11.1801;
(2) providing support or relief to orphans, delinquent
or dependent children in need of residential care, children with
disabilities in need of residential care, abused or battered
spouses or children in need of temporary shelter, the impoverished,
or victims of natural disaster without regard to the beneficiaries'
ability to pay;
(3) providing support without regard to the
beneficiaries' ability to pay to:
(A) elderly persons, including the provision of:
(i) recreational or social activities; and
(ii) facilities designed to address the
special needs of elderly persons; or
(B) persons with disabilities, including
training and employment:
(i) in the production of commodities; or
(ii) in the provision of services under 41
U.S.C. Sections 8501-8506;
(4) preserving a historical landmark or site;
(5) promoting or operating a museum, zoo, library,
theater of the dramatic or performing arts, or symphony orchestra
or choir;
(6) promoting or providing humane treatment of
animals;
(7) acquiring, storing, transporting, selling, or
distributing water for public use;
(8) answering fire alarms and extinguishing fires with
no compensation or only nominal compensation to the members of the
organization;
(9) promoting the athletic development of boys or
girls under the age of 18 years;
(10) preserving or conserving wildlife;
(11) promoting educational development through loans
or scholarships to students;
(12) providing halfway house services pursuant to a
certification as a halfway house by the parole division of the Texas
Department of Criminal Justice;
(13) providing permanent housing and related social,
health care, and educational facilities for persons who are 62
years of age or older without regard to the residents' ability to
pay;
(14) promoting or operating an art gallery, museum, or
collection, in a permanent location or on tour, that is open to the
public;
(15) providing for the organized solicitation and
collection for distributions through gifts, grants, and agreements
to nonprofit charitable, education, religious, and youth
organizations that provide direct human, health, and welfare
services;
(16) performing biomedical or scientific research or
biomedical or scientific education for the benefit of the public;
(17) operating a television station that produces or
broadcasts educational, cultural, or other public interest
programming and that receives grants from the Corporation for
Public Broadcasting under 47 U.S.C. Section 396, as amended;
(18) providing housing for low-income and
moderate-income families, for unmarried individuals 62 years of age
or older, for individuals with disabilities, and for families
displaced by urban renewal, through the use of trust assets that are
irrevocably and, pursuant to a contract entered into before
December 31, 1972, contractually dedicated on the sale or
disposition of the housing to a charitable organization that
performs charitable functions described by Subdivision (9);
(19) providing housing and related services to persons
who are 62 years of age or older in a retirement community, if the
retirement community provides independent living services,
assisted living services, and nursing services to its residents on
a single campus:
(A) without regard to the residents' ability to
pay; or
(B) in which at least four percent of the
retirement community's combined net resident revenue is provided in
charitable care to its residents;
(20) providing housing on a cooperative basis to
students of an institution of higher education if:
(A) the organization is exempt from federal
income taxation under Section 501(a), Internal Revenue Code of
1986, as amended, by being listed as an exempt entity under Section
501(c)(3) of that code;
(B) membership in the organization is open to all
students enrolled in the institution and is not limited to those
chosen by current members of the organization;
(C) the organization is governed by its members;
and
(D) the members of the organization share the
responsibility for managing the housing;
(21) acquiring, holding, and transferring unimproved
real property under an urban land bank demonstration program
established under Chapter 379C, Local Government Code, as or on
behalf of a land bank;
(22) acquiring, holding, and transferring unimproved
real property under an urban land bank program established under
Chapter 379E, Local Government Code, as or on behalf of a land bank;
(23) providing housing and related services to
individuals who:
(A) are unaccompanied and homeless and have a
disabling condition; and
(B) have been continuously homeless for a year or
more or have had at least four episodes of homelessness in the
preceding three years;
(24) operating a radio station that broadcasts
educational, cultural, or other public interest programming,
including classical music, and that in the preceding five years has
received or been selected to receive one or more grants from the
Corporation for Public Broadcasting under 47 U.S.C. Section 396, as
amended;
(25) providing, without regard to the beneficiaries'
ability to pay, tax return preparation services and assistance with
other financial matters; [or]
(26) providing services related to planning for the
placement of or placing children in foster or adoptive homes or
providing support or relief to women who are or may be pregnant and
who are considering placing their unborn children for adoption; or
(27) providing financial support for medical care at
an institution of higher education described by Section 63.101,
Education Code.
SECTION 2. The changes in law made by this Act apply only to
an ad valorem tax year that begins on or after the effective date of
this Act.
SECTION 3. This Act takes effect January 1, 2026.