BILL ANALYSIS


                                                        H.J.R. 31
                                           By: Hartnett (Sponsor)
                                                          Finance
                                                         05-16-95
                              Senate Committee Report (Unamended)
BACKGROUND

Current law allows ad valorem taxation for income-producing
tangible personal property, regardless of its value.  When a
property has a value less than $500, the tax generated may not
cover the costs of the collection.  For properties with very low
taxable values, taxing authorities are required by law to assess
and collect a tax even though they may lose money.

PURPOSE

As proposed, H.J.R. 31 requires submission to the voters of a
constitutional amendment granting tax exemption for income-producing personal property and mineral interest with a value less
than sufficient to recover the costs of administering the taxes.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 1, Article VIII, Texas Constitution, by
amending Subsection (d) and adding Subsections (g) and (h), as
follows:

     (d)  Authorizes the Legislature by general law to exempt from
     ad valorem taxation all other tangible personal property,
     except structures which are personal property and are used or
     occupied as residential dwellings and except property held or
     used for the production of income, subject to Subsections (e)
     and (g) of this section.
     
     (g)  Authorizes the Legislature to exempt from ad valorem
     taxation tangible personal property that is held or used for
     the production of income and has a taxable value of less than
     the minimum amount sufficient to recover the costs of the
     administration of the taxes on the property, as determined by
     or under the general law granting the exemption.
     
     (h)  Authorizes the Legislature to exempt from ad valorem
     taxation a mineral interest that has a taxable value of less
     than the minimum amount sufficient to recover the costs of the
     administration of the taxes on the interest, as determined by
     or under the general law granting the exemption.
     
     SECTION 2.     Requires this constitutional amendment to be submitted
to the voters on an election to be held November 7, 1995.  Sets
forth the required language for the ballot.