BILL ANALYSIS
C.S.H.B. 2941
By: Heflin
April 27, 1995
Committee Report (Substituted)
BACKGROUND
Interspersed throughout the Tax Code are various sections relating
to the valuation of property and assessment of taxes upon such
property. Among those sections are provisions related to the
rights, powers, and duties of appraisal review boards and appraisal
districts. Also included are provisions related to the interaction
between taxpayers (or their designated representative) and the
appraisal entities on appraisal and taxation matters regarding
their property.
PURPOSE
The purpose of this bill is to amend certain property tax
provisions of the Tax Code to enhance efficiency and taxpayer
service in the appraisal system.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does grant additional
rulemaking authority to the Comptroller of Public Accounts in
Section 2 of the bill.
SECTION BY SECTION ANALYSIS
SECTION 1. Adds Subsection (d) to Section 1.07, Tax Code (Delivery
of Notice), requiring delivery by certified mail from the appraisal
district on notices to a taxpayer of exemptions or special
valuations.
SECTION 2. Adds Section 6.414 to the Tax Code (Training),
requiring the Comptroller under Subsection (a) to establish minimum
standards for training of appraisal review board members.
Subsection (b) requires members to attend and receive certification
of attendance before participating in hearings. Requires the
Comptroller to adopt rules for purposes of a training program.
SECTION 3. Adds Section 6.415 to the Tax Code (Eligibility of
Former Officers and Directors of Tax Entities in Counties of More
Than 50,000 Population), which prohibits a former officer,
director, or certain employees of a taxing entity or appraisal
district in a county of more than 50,000 from serving on an
appraisal review board that reviews appraisals from such entities.
SECTION 4. Amends Subsection (h) of Section 11.251, Tax Code
(Tangible Personal Property Exempt), by allowing a property owner
up until appraisal records are approved to provide information
requested by the appraiser related to a freeport exemption claim.
Existing language gives property owner 31 days from the time of the
request.
SECTION 5. Adds Section 11.437 to Tax Code (Late Application for
Freeport Exemption), relating to a late application for freeport
exemption. If an application has been filed after the filing
deadline but before the approval of appraisal records and
subsequently approved, the owner is liable for a 10 percent penalty
based on the difference between the amount taxed and the amount
that would have been taxed at market value. Furthermore, the
penalty constitutes a lien against the property and accrues
interest and penalty as if the penalty itself was a delinquent tax.
SECTION 6. Amends Subsection (a) of Section 22.23, Tax Code
(Filing Date), to clarify the April 15th due date for rendition
statements.
SECTION 7. Amends Subsection (f) of Section 23.55, Tax Code
(Change of Use of Land), to exempt property transferred by sale,
gift, or other manner for public purposes from the five-year
rollback provision.
SECTION 8. Amends Subsection (c) of Section 33.01, Tax Code
(Penalties and Interest), to allow post-judgement interest to
continue to accrue at one percent per month.
SECTION 9. Adds Subsection (d) to Section 33.41, Tax Code (Suit to
Collect Delinquent Tax), to allow taxing units to bring suit
against an estate in a court where the taxing unit is located.
SECTION 10. Amends Subsection (c) of Section 33.47, Tax Code (Tax
Records as Evidence), to allow an electronic replica of a tax
receipt to be used as evidence that a tax was paid.
SECTION 11. Amends Section 33.51, Tax Code (Writ of Possession),
to allow immediate possession of property by a purchaser after a
tax sale. This section also provides a 20-day grace period before
a former owner has to vacate the property.
SECTION 12. Amends Subsection (a) and (b), and adds Subsection (c)
to Section 33.52, Tax Code (Judgement for Current Taxes).
Amendments to (a) and (b) allow a taxing unit the option of
recovering from the proceeds of the sale the amount of tax in the
current year or from the preceding year. Subsection (c) would make
a purchaser liable for current year taxes if those taxes are not
included in the judgement.
SECTION 13. Amends Subsection (a), Section 34.05, Tax Code (Resale
by Taxing Unit), to allow the taxing unit to use the procedures
provided by Section 272.001, Local Government Code.
SECTION 14. Amends Section 34.21, Tax Code (Right of Redemption),
to clarify language related to redemption premiums on a former
owner redeeming a property. If the property was a residence
homestead, or designated for agricultural use, and has not been
resold by a taxing unit, the former owner does not have to pay a
redemption premium. If the property was not a residence homestead
or designated for agricultural use, and has not been resold by a
taxing unit, there is a redemption premium cap of 25 percent. If
the property has been resold, a redemption premium is set at 25
percent if the redemption occurs during the first year and 50%
during the second year.
Subsection (i) is added to define "costs" recoverable in a
redemption, which includes reasonable expenses on insurance, code
and ordinance compliance repairs, municipal work, and property
owners' association dues and assessments.
SECTION 15. Amends Section 34.23, Tax Code (Distribution of
Redemption Proceeds), by deleting redemption language which exists
in Section 34.21. This also will have the effect of completely
removing the taxing unit as an intermediary between a former owner
and a purchaser.
SECTION 16. Amends Section 41.01, Tax Code (Duties of Appraisal
Review Board), by adding language which clarifies a board's
authority to take certain actions. Adds Subsection (b), which
prohibits a board from taking any action not specifically
authorized by the Tax Code.
SECTION 17. Adds Subsection (e) to Section 41.44, Tax Code (Notice
of Protest), which requires an appraisal review board to accept a
protest filed by an owner's agent if authorization is filed at or
before a hearing on the protest.
SECTION 18. Amends Section 41.45, Tax Code (Hearing on Protest),
Subsection (b), by setting forth basic elements of an affidavit
filed by the property owner that constitute a sufficient affidavit:
1) identifies protesting property owner; 2) identifies property
that is the subject of the protest; and 3) indicates a statement by
the owner on a determination of the appraisal district relevant to
the property that is the subject of the protest.
Amends Subsection (d) by allowing a protest rejected by the board
to be referred to a different panel than the one that heard the
original protest.
Amends Subsection (e) by allowing a postponement of a hearing
because of a different appraisal district hearing on the same date
if the property owner or the owner's agent provides a copy of the
separate hearing notice bearing an earlier postmark.
Adds Subsection (g) by requiring a mutual exchange of written
materials to be used at a hearing between a chief appraiser and an
owner or agent.
SECTION 19. Adds Section 41.48 to the Tax Code (Settlement
Agreements), which requires a chief appraiser to change the
appraisal records or appraisal roll to reflect an agreement reached
between the chief appraiser and the property owner or the owner's
agent. An owner or agent may file suit to compel the appraisal
review board to comply with this section.
SECTION 20. Amends Subsection (c) of Section 41.61, Tax Code
(Issuance of Subpoena), by requiring the appraisal review board to
specify to all parties to the protest and the person who is being
subpoenaed the date, time, and place of the hearing. Also states
that the person being subpoenaed must have the opportunity to be
heard at the hearing.
SECTION 21. Amends Section 42.06, Tax Code (Notice of Appeal), by
deleting Subsection (b), which gives an owner of property in excess
of $1 million 15 days to file an appeal after an order by the
appraisal review board or the comptroller. Also amends language
relating to filing requirements to allow an owner's agent to file
an appeal.
SECTION 22. Amends Subsection (b) of Section 42.43, Tax Code
(Refund), to set the interest rate of a refund not related to an
exemption granted under Section 11.20 (Religious Organizations)
that was previously denied at 8 percent. Refunds made under the
previously mentioned language will stay equal to the three month T-bill rate, but not more than 10 percent.
SECTION 23. Amends Section 6.035, Tax Code (Restrictions on
Eligibility and Conduct of Board Members and Chief Appraisers and
Their Relatives), by adding Subsection (e) to prohibit a chief
appraiser from appearing before an appraisal review board on
protests or other proceedings related to an appraisal record or
roll created during that person's service with the appraisal
district.
SECTION 24. Sections 2 and 3 of this Act apply to an appraisal
review board member whose term begins on or after January 1, 1996.
SECTION 25. Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
The original bill contained several sections which were not
included in the committee substitute. These deletions include
amendments to the following Tax Code provisions: Section 1.111,
Section 25.25, Section 41.47, Section 41.66, Section 41.67, Section
42.07 and Section 43.01.
C.S.H.B. 2941 contains sections to amend provisions in the Tax Code
which were not amended in the original bill. This added language
amends the following: Section 33.01, Section 33.41, Section 33.47,
Section 33.51, Section 33.52, Section 34.05, Section 34.21 and
Section 34.23.
Several of the property tax provisions that were amended in the
original bill are also amended in the committee substitute, but
with language changes. These include changes to the following
sections of the Tax Code:
(Section 1.07) H.B. 2941 required delivery by certified mail
from the appraisal district on notices to a taxpayer of omitted
property, rollbacks, denial of exemptions or special valuations,
and correction of appraisal rolls. C.S.H.B. requires certified
mail delivery on exemptions or special use designations.
(Section 6.414) C.S.H.B. 2941 requires the comptroller to
establish minimum standards
for training of appraisal review board members, rather than
establishing a training program as required under H.B. 2941.
(Section 6.415) C.S.H.B. 2941 exempts small counties from
restrictions on appraisal review board membership eligibility that
was established in H.B. 2941.
(Section 41.45) Language on affidavit requirement in H.B.
2941 was changed from indicating "apparent dissatisfaction with
some determination of the appraisal office" to "a statement by the
owner on a determination of the appraisal district relevant to the
property that is the subject of the protest" in C.S.H.B. 2941.
C.S.H.B. 2941 also allows a different panel to hear a protest if
the ARB rejects a recommendation offered by the original panel.
Additionally, the original bill required the chief appraiser to
provide certain information to the property owner, while the
committee substitute requires a mutual exchange of written
materials.
(Section 41.48) Requirement to change records based on
settlement agreements changed from appraisal review board (HB 2941)
to chief appraiser (CSHB 2941).
(Section 41.61) Language in the original bill allowing all
parties to the protest to participate in a hearing is changed in
the committee substitute to specifically allow the party being
subpoenaed an opportunity to be heard.
(Section 6.035) Language in H.B. 2941 restricting service with
an appraisal district or appraisal firm from consideration as a
senior property tax consultant changed in C.S.H.B. 2941 to restrict
a chief appraiser from appearing before an appraisal review board
on protests or other proceedings related to an appraisal record or
roll created during that person's service with the appraisal
district.
SUMMARY OF COMMITTEE ACTION
Public notice was posted in accordance with the rules, and a public
hearing was held on April 18, 1995. Representative Heflin
explained the bill. The committee considered a complete substitute
by Representative Heflin. Without objection, C.S.H.B. 2941 was
adopted. By a record vote of 9 ayes, 0 nays, 0 present not voting
and 2 absent, the committee voted to report H.B. 2941 to the House
as substituted with the recommendation that it do pass.
Testimony received in favor of the bill:
Buddy Winn, representing himself and the Tax
Assessor/Collector Assn. TX
Jim Robinson, representing himself
Breck Bostwick, representing himself and the Texas Assn.
of Property Tax Professionals
Dale Cummings, representing himself and the Texas Assn.
of Taxpayers