By: Barrientos S.B. No. 668
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the ad valorem tax rate of certain taxing units.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Section 26.04, Tax Code, is amended by adding
1-4 Subsections (k) and (l) to read as follows:
1-5 (k) This subsection applies to a taxing unit that has agreed
1-6 by written contract to transfer a distinct department, function, or
1-7 activity to another taxing unit and discontinues operating that
1-8 distinct department, function, or activity if the operation of that
1-9 department, function, or activity in all or a majority of the
1-10 territory of the taxing unit is continued by another existing
1-11 taxing unit or by a new taxing unit. The rollback tax rate of a
1-12 taxing unit to which this subsection applies in the first tax year
1-13 in which a budget is adopted that does not allocate revenue to the
1-14 discontinued department, function, or activity is calculated as
1-15 otherwise provided by this section, except that last year's levy
1-16 used to calculate the effective maintenance and operations rate of
1-17 the unit is reduced by the amount of maintenance and operations tax
1-18 revenue spent by the taxing unit to operate the department,
1-19 function, or activity for the 12 months preceding the month in
1-20 which the calculations required by this chapter are made and in
1-21 which the unit operated the discontinued department, function, or
1-22 activity. If the unit did not operate that department, function,
1-23 or activity for the full 12 months preceding the month in which the
1-24 calculations required by this chapter are made, the unit shall
2-1 reduce last year's levy used for calculating the effective
2-2 maintenance and operations rate of the unit by the amount of the
2-3 revenue spent in the last full fiscal year in which the unit
2-4 operated the discontinued department, function, or activity.
2-5 (l) This subsection applies to a taxing unit that had agreed
2-6 by written contract to accept the transfer of a distinct
2-7 department, function, or activity from another taxing unit and
2-8 operates a distinct department, function, or activity if the
2-9 operation of a substantially similar department, function, or
2-10 activity in all or a majority of the territory of the taxing unit
2-11 has been discontinued by another taxing unit, including a dissolved
2-12 taxing unit. The rollback tax rate of a taxing unit to which this
2-13 subsection applies in the first tax year after the other taxing
2-14 unit discontinued the substantially similar department, function,
2-15 or activity in which a budget is adopted that allocates revenue to
2-16 the department, function, or activity is calculated as otherwise
2-17 provided by this section, except that last year's levy used to
2-18 calculate the effective maintenance and operations rate of the unit
2-19 is increased by the amount of maintenance and operations tax
2-20 revenue spent by the taxing unit that discontinued operating the
2-21 substantially similar department, function, or activity to operate
2-22 that department, function, or activity for the 12 months preceding
2-23 the month in which the calculations required by this chapter are
2-24 made and in which the unit operated the discontinued department,
2-25 function, or activity. If the unit did not operate the
2-26 discontinued department, function, or activity for the full 12
2-27 months preceding the month in which the calculations required by
3-1 this chapter are made, the unit may increase last year's levy used
3-2 to calculate the effective maintenance and operations rate by an
3-3 amount not to exceed the amount of property tax revenue spent by
3-4 the discontinuing unit to operate the discontinued department,
3-5 function, or activity in the last full fiscal year in which the
3-6 discontinuing unit operated the department, function, or activity.
3-7 SECTION 2. Subsection (e), Section 26.04, Tax Code, is
3-8 amended to read as follows:
3-9 (e) By August 7 or as soon thereafter as practicable, the
3-10 designated officer or employee shall submit the rates to the
3-11 governing body. He shall publish in a newspaper in the form
3-12 prescribed by the comptroller:
3-13 (1) the effective tax rate, the rollback tax rate, and
3-14 an explanation of how they were calculated;
3-15 (2) the estimated amount of interest and sinking fund
3-16 balances and the estimated amount of maintenance and operation or
3-17 general fund balances remaining at the end of the current fiscal
3-18 year that are not encumbered with or by corresponding existing debt
3-19 obligation, except that for a school district, estimated funds
3-20 necessary for the operation of the district prior to the receipt of
3-21 the first state education aid payment in the succeeding school year
3-22 shall be subtracted from the estimated fund balances;
3-23 (3) a schedule of the unit's debt obligations showing:
3-24 (A) the amount of principal and interest that
3-25 will be paid to service the unit's debts in the next year from
3-26 property tax revenue, including payments of lawfully incurred
3-27 contractual obligations providing security for the payment of the
4-1 principal of and interest on bonds and other evidences of
4-2 indebtedness issued on behalf of the unit by another political
4-3 subdivision;
4-4 (B) the amount by which taxes imposed for debt
4-5 are to be increased because of the unit's anticipated collection
4-6 rate; and
4-7 (C) the total of the amounts listed in
4-8 Paragraphs (A)-(B), less any amount collected in excess of the
4-9 previous year's anticipated collections certified as provided in
4-10 Subsection (b) of this section; <and>
4-11 (4) the amount of additional sales and use tax revenue
4-12 anticipated in calculations under Section 26.041 of this code;
4-13 (5) in the year that a taxing unit calculates an
4-14 adjustment under Section 26.04(k) or (l) of this code, the unit
4-15 shall publish a schedule that includes the following elements:
4-16 (A) the name of the unit discontinuing the
4-17 department, function, or activity;
4-18 (B) the amount of property tax revenue spent by
4-19 the unit listed under Paragraph (A) of this subsection to operate
4-20 the discontinued department, function, or activity in the 12 months
4-21 preceding the month in which the calculations required by this
4-22 chapter are made; and
4-23 (C) the name of the unit that operates a
4-24 distinct department, function, or activity in all or a majority of
4-25 the territory of a taxing unit that has discontinued operating the
4-26 distinct department, function, or activity; and
4-27 (6) in the year following the year in which a taxing
5-1 unit raised its rollback rate as required by Section 26.04(l) of
5-2 this code, the taxing unit shall publish a schedule that includes
5-3 the following elements:
5-4 (A) the amount of property tax revenue spent by
5-5 the unit to operate the department, function, or activity for which
5-6 the taxing unit raised the rollback rate as required by Section
5-7 26.04(l) of this code for the 12 months preceding the month in
5-8 which the calculations required by this chapter are made; and
5-9 (B) the amount published by the unit in the
5-10 preceding tax year under Section 26.04(e)(5)(B) of this code.
5-11 SECTION 3. The change in law made by this Act applies only
5-12 to a taxing unit that adopts its tax rate on or after the effective
5-13 date of this Act.
5-14 SECTION 4. The importance of this legislation and the
5-15 crowded condition of the calendars in both houses create an
5-16 emergency and an imperative public necessity that the
5-17 constitutional rule requiring bills to be read on three several
5-18 days in each house be suspended, and this rule is hereby suspended,
5-19 and that this Act take effect and be in force from and after its
5-20 passage, and it is so enacted.