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A BILL TO BE ENTITLED
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AN ACT
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relating to the authority of the governing body of a taxing unit to |
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adopt an exemption from ad valorem taxation of a portion, expressed |
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as a dollar amount, of the appraised value of an individual's |
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residence homestead. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 11.13, Tax Code, is amended by amending |
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Subsection (i) and adding Subsection (n-2) to read as follows: |
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(i) The assessor and collector for a taxing unit may |
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disregard the exemptions authorized by Subsection (b), (c), (d), |
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[or] (n), or (n-2) [of this section] and assess and collect a tax |
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pledged for payment of debt without deducting the amount of the |
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exemption if: |
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(1) prior to adoption of the exemption, the unit |
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pledged the taxes for the payment of a debt; and |
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(2) granting the exemption would impair the obligation |
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of the contract creating the debt. |
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(n-2) The governing body of a taxing unit, in the manner |
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provided by law for official action by the body, may adopt an |
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exemption from taxation by the taxing unit of a portion, expressed |
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as a dollar amount, of the appraised value of an individual's |
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residence homestead. The exemption must be adopted by the |
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governing body before July 1 of the tax year in which the exemption |
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applies. If the governing body adopts an exemption under this |
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subsection, the amount of the exemption in a tax year may not be |
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less than $5,000. An individual is entitled to an exemption adopted |
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under this subsection in addition to any other exemptions provided |
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by this section. |
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SECTION 2. Section 45.006(f), Education Code, is amended to |
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read as follows: |
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(f) The governing body of a school district that adopts a |
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tax rate that exceeds $1.50 per $100 valuation of taxable property |
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may set the amount of the exemption from taxation authorized by |
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Section 11.13(n) or (n-2), Tax Code, at any time before the date the |
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governing body adopts the district's tax rate for the tax year in |
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which the election approving the additional taxes is held. |
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SECTION 3. Section 48.259(a), Education Code, is amended to |
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read as follows: |
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(a) In any school year, the commissioner may not provide |
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funding under this chapter or Chapter 46 based on a school |
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district's taxable value of property computed in accordance with |
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Section 403.302(d)(2), Government Code, unless: |
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(1) funds are specifically appropriated for purposes |
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of this section; or |
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(2) the commissioner determines that the total amount |
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of state funds appropriated for purposes of the Foundation School |
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Program for the school year exceeds the amount of state funds |
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distributed to school districts in accordance with Section 48.266 |
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based on the taxable values of property in school districts |
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computed in accordance with Section 403.302(d), Government Code, |
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without any deduction for residence homestead exemptions granted |
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under Section 11.13(n) or (n-2), Tax Code. |
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SECTION 4. Section 403.302(d), Government Code, effective |
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until January 1, 2027, is amended to read as follows: |
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(d) For the purposes of this section, "taxable value" means |
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the market value of all taxable property less: |
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(1) the total dollar amount of any residence homestead |
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exemptions lawfully granted under Section 11.13(b) or (c), Tax |
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Code, in the year that is the subject of the study for each school |
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district; |
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(2) one-half of the total dollar amount of any |
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residence homestead exemptions granted under Section 11.13(n) or |
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(n-2), Tax Code, in the year that is the subject of the study for |
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each school district; |
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(3) the total dollar amount of any exemptions granted |
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before May 31, 1993, within a reinvestment zone under agreements |
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authorized by Chapter 312, Tax Code; |
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(4) subject to Subsection (e), the total dollar amount |
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of any captured appraised value of property that: |
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(A) is within a reinvestment zone created on or |
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before May 31, 1999, or is proposed to be included within the |
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boundaries of a reinvestment zone as the boundaries of the zone and |
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the proposed portion of tax increment paid into the tax increment |
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fund by a school district are described in a written notification |
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provided by the municipality or the board of directors of the zone |
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to the governing bodies of the other taxing units in the manner |
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provided by former Section 311.003(e), Tax Code, before May 31, |
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1999, and within the boundaries of the zone as those boundaries |
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existed on September 1, 1999, including subsequent improvements to |
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the property regardless of when made; |
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(B) generates taxes paid into a tax increment |
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fund created under Chapter 311, Tax Code, under a reinvestment zone |
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financing plan approved under Section 311.011(d), Tax Code, on or |
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before September 1, 1999; and |
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(C) is eligible for tax increment financing under |
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Chapter 311, Tax Code; |
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(5) the total dollar amount of any captured appraised |
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value of property that: |
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(A) is within a reinvestment zone: |
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(i) created on or before December 31, 2008, |
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by a municipality with a population of less than 18,000; and |
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(ii) the project plan for which includes |
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the alteration, remodeling, repair, or reconstruction of a |
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structure that is included on the National Register of Historic |
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Places and requires that a portion of the tax increment of the zone |
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be used for the improvement or construction of related facilities |
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or for affordable housing; |
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(B) generates school district taxes that are paid |
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into a tax increment fund created under Chapter 311, Tax Code; and |
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(C) is eligible for tax increment financing under |
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Chapter 311, Tax Code; |
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(6) the total dollar amount of any exemptions granted |
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under Section 11.251 or 11.253, Tax Code; |
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(7) the difference between the comptroller's estimate |
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of the market value and the productivity value of land that |
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qualifies for appraisal on the basis of its productive capacity, |
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except that the productivity value estimated by the comptroller may |
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not exceed the fair market value of the land; |
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(8) the portion of the appraised value of residence |
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homesteads of individuals who receive a tax limitation under |
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Section 11.26, Tax Code, on which school district taxes are not |
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imposed in the year that is the subject of the study, calculated as |
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if the residence homesteads were appraised at the full value |
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required by law; |
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(9) a portion of the market value of property not |
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otherwise fully taxable by the district at market value because of |
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action required by statute or the constitution of this state, other |
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than Section 11.311, Tax Code, that, if the tax rate adopted by the |
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district is applied to it, produces an amount equal to the |
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difference between the tax that the district would have imposed on |
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the property if the property were fully taxable at market value and |
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the tax that the district is actually authorized to impose on the |
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property, if this subsection does not otherwise require that |
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portion to be deducted; |
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(10) the market value of all tangible personal |
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property, other than manufactured homes, owned by a family or |
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individual and not held or used for the production of income; |
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(11) the appraised value of property the collection of |
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delinquent taxes on which is deferred under Section 33.06, Tax |
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Code; |
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(12) the portion of the appraised value of property |
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the collection of delinquent taxes on which is deferred under |
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Section 33.065, Tax Code; |
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(13) the amount by which the market value of property |
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to which Section 23.23 or 23.231, Tax Code, applies exceeds the |
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appraised value of that property as calculated under Section 23.23 |
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or 23.231, Tax Code, as applicable; and |
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(14) the total dollar amount of any exemptions granted |
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under Section 11.35, Tax Code. |
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SECTION 5. Section 403.302(d), Government Code, as |
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effective January 1, 2027, is amended to read as follows: |
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(d) For the purposes of this section, "taxable value" means |
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the market value of all taxable property less: |
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(1) the total dollar amount of any residence homestead |
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exemptions lawfully granted under Section 11.13(b) or (c), Tax |
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Code, in the year that is the subject of the study for each school |
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district; |
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(2) one-half of the total dollar amount of any |
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residence homestead exemptions granted under Section 11.13(n) or |
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(n-2), Tax Code, in the year that is the subject of the study for |
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each school district; |
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(3) the total dollar amount of any exemptions granted |
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before May 31, 1993, within a reinvestment zone under agreements |
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authorized by Chapter 312, Tax Code; |
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(4) subject to Subsection (e), the total dollar amount |
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of any captured appraised value of property that: |
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(A) is within a reinvestment zone created on or |
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|
before May 31, 1999, or is proposed to be included within the |
|
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boundaries of a reinvestment zone as the boundaries of the zone and |
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the proposed portion of tax increment paid into the tax increment |
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fund by a school district are described in a written notification |
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|
provided by the municipality or the board of directors of the zone |
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|
to the governing bodies of the other taxing units in the manner |
|
|
provided by former Section 311.003(e), Tax Code, before May 31, |
|
|
1999, and within the boundaries of the zone as those boundaries |
|
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existed on September 1, 1999, including subsequent improvements to |
|
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the property regardless of when made; |
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(B) generates taxes paid into a tax increment |
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fund created under Chapter 311, Tax Code, under a reinvestment zone |
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financing plan approved under Section 311.011(d), Tax Code, on or |
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before September 1, 1999; and |
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(C) is eligible for tax increment financing under |
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Chapter 311, Tax Code; |
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(5) the total dollar amount of any captured appraised |
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value of property that: |
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(A) is within a reinvestment zone: |
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(i) created on or before December 31, 2008, |
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by a municipality with a population of less than 18,000; and |
|
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(ii) the project plan for which includes |
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the alteration, remodeling, repair, or reconstruction of a |
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structure that is included on the National Register of Historic |
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Places and requires that a portion of the tax increment of the zone |
|
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be used for the improvement or construction of related facilities |
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or for affordable housing; |
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(B) generates school district taxes that are paid |
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into a tax increment fund created under Chapter 311, Tax Code; and |
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(C) is eligible for tax increment financing under |
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Chapter 311, Tax Code; |
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(6) the total dollar amount of any exemptions granted |
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under Section 11.251 or 11.253, Tax Code; |
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(7) the difference between the comptroller's estimate |
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of the market value and the productivity value of land that |
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qualifies for appraisal on the basis of its productive capacity, |
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except that the productivity value estimated by the comptroller may |
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not exceed the fair market value of the land; |
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(8) the portion of the appraised value of residence |
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homesteads of individuals who receive a tax limitation under |
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Section 11.26, Tax Code, on which school district taxes are not |
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imposed in the year that is the subject of the study, calculated as |
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if the residence homesteads were appraised at the full value |
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required by law; |
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(9) a portion of the market value of property not |
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otherwise fully taxable by the district at market value because of |
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action required by statute or the constitution of this state, other |
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than Section 11.311, Tax Code, that, if the tax rate adopted by the |
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district is applied to it, produces an amount equal to the |
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difference between the tax that the district would have imposed on |
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the property if the property were fully taxable at market value and |
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the tax that the district is actually authorized to impose on the |
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property, if this subsection does not otherwise require that |
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portion to be deducted; |
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(10) the market value of all tangible personal |
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property, other than manufactured homes, owned by a family or |
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individual and not held or used for the production of income; |
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(11) the appraised value of property the collection of |
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delinquent taxes on which is deferred under Section 33.06, Tax |
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Code; |
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(12) the portion of the appraised value of property |
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the collection of delinquent taxes on which is deferred under |
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Section 33.065, Tax Code; |
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(13) the amount by which the market value of a |
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residence homestead to which Section 23.23, Tax Code, applies |
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exceeds the appraised value of that property as calculated under |
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that section; and |
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(14) the total dollar amount of any exemptions granted |
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under Section 11.35, Tax Code. |
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SECTION 6. Section 25.23(a), Tax Code, is amended to read as |
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follows: |
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(a) After submission of appraisal records, the chief |
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appraiser shall prepare supplemental appraisal records listing: |
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(1) each taxable property the chief appraiser |
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discovers that is not included in the records already submitted, |
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including property that was omitted from an appraisal roll in a |
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prior tax year; |
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(2) property on which the appraisal review board has |
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not determined a protest at the time of its approval of the |
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appraisal records; and |
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(3) property that qualifies for an exemption under |
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Section 11.13(n) or (n-2) that was adopted by the governing body of |
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a taxing unit after the date the appraisal records were submitted. |
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SECTION 7. This Act applies only to ad valorem taxes imposed |
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for a tax year that begins on or after the effective date of this |
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Act. |
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SECTION 8. This Act takes effect January 1, 2026, but only |
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if the constitutional amendment proposed by the 89th Legislature, |
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Regular Session, 2025, authorizing the governing body of a |
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political subdivision to adopt an exemption from ad valorem |
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taxation of a portion, expressed as a dollar amount, of the market |
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value of an individual's residence homestead is approved by the |
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voters. If that amendment is not approved by the voters, this Act |
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has no effect. |