89R2999 DRS-D
By: Kolkhorst S.B. No. 322
A BILL TO BE ENTITLED
AN ACT
relating to the limitation on increases in the appraised value of
certain real property for ad valorem tax purposes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 23.231(c), (d), and (k), Tax Code, are
amended to read as follows:
(c) This section does not apply to:
(1) a residence homestead that qualifies for an
exemption under Section 11.13; [or]
(2) property appraised under Subchapter C, D, E, F, G,
or H; or
(3) a mineral interest.
(d) Notwithstanding the requirements of Section 25.18 and
regardless of whether the appraisal office has appraised the
property and determined the market value of the property for the tax
year, an appraisal office may increase the appraised value of real
property to which this section applies for a tax year to an amount
not to exceed the lesser of:
(1) the market value of the property for the most
recent tax year that the market value was determined by the
appraisal office; or
(2) the sum of:
(A) 10 [20] percent of the appraised value of the
property for the preceding tax year;
(B) the appraised value of the property for the
preceding tax year; and
(C) the market value of all new improvements to
the property.
(k) This section expires December 31, 2031 [2026].
SECTION 2. Section 25.19(o), Tax Code, is amended to read as
follows:
(o) A notice required under Subsection (a) or (g) to be
delivered to the owner of real property other than a single-family
residence that qualifies for an exemption under Section 11.13 must
include the following statement: "Under Section 23.231, Tax Code,
for the [2024, 2025, and] 2026, 2027, 2028, 2029, 2030, and 2031 tax
years, the appraised value of real property other than a residence
homestead for ad valorem tax purposes may not be increased by more
than 10 [20] percent each year, with certain exceptions. The
circuit breaker limitation provided under Section 23.231, Tax Code,
expires December 31, 2031 [2026]. Unless this expiration date is
extended by the Texas Legislature, beginning in the 2032 [2027] tax
year, the circuit breaker limitation provided under Section 23.231,
Tax Code, will no longer be in effect and may result in an increase
in ad valorem taxes imposed on real property previously subject to
the limitation." This subsection expires December 31, 2032 [2027].
SECTION 3. Notwithstanding Chapter 1 (S.B. 2), Acts of the
88th Legislature, 2nd Called Session, 2023, the following
provisions are effective January 1, 2032:
(1) Section 4.02, Chapter 1 (S.B. 2), Acts of the 88th
Legislature, 2nd Called Session, 2023, which amended Section
1.12(d), Tax Code;
(2) Section 4.05, Chapter 1 (S.B. 2), Acts of the 88th
Legislature, 2nd Called Session, 2023, which amended Sections
25.19(b) and (g), Tax Code;
(3) Section 4.08, Chapter 1 (S.B. 2), Acts of the 88th
Legislature, 2nd Called Session, 2023, which amended Section
41.41(a), Tax Code;
(4) Section 4.10, Chapter 1 (S.B. 2), Acts of the 88th
Legislature, 2nd Called Session, 2023, which amended Section
42.26(d), Tax Code; and
(5) Section 4.12, Chapter 1 (S.B. 2), Acts of the 88th
Legislature, 2nd Called Session, 2023, which amended Sections
403.302(d) and (i), Government Code.
SECTION 4. Sections 23.231(c) and (d), Tax Code, as amended
by this Act, apply only to the appraisal of real property for ad
valorem tax purposes for a tax year that begins on or after the
effective date of this Act.
SECTION 5. (a) Except as otherwise provided by this
section, this Act takes effect January 1, 2026.
(b) Sections 23.231(d) and (k) and 25.19(o), Tax Code, as
amended by this Act, and Section 3 of this Act take effect January
1, 2026, but only if the constitutional amendment proposed by the
89th Legislature, Regular Session, 2025, to authorize the
legislature to set a lower limit on the maximum appraised value of
real property other than a residence homestead for ad valorem tax
purposes and to postpone the expiration of the limit is approved by
the voters. If that amendment is not approved by the voters,
Sections 23.231(d) and (k) and 25.19(o), Tax Code, as amended by
this Act, and Section 3 of this Act have no effect.