BILL ANALYSIS C.S.H.J.R. 106 By: Harris May 2, 1995 Committee Report (Substituted) BACKGROUND Section 15, Article VIII, Texas Constitution establishes that property of a delinquent taxpayer is liable to seizure and sale for the payment of all the taxes and penalties due, under such regulations as the Legislature may provide. Chapter 34, Tax Code, provides the procedures for tax sales. PURPOSE This bill would extinguish a taxpayer's liability for delinquent taxes, penalties, and interest upon sale of property at an ad valorem tax lien sale, regardless of whether the proceeds are sufficient to satisfy the judgement. The enabling legislation is HB 2596. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 15 (Lien of Assessment; Seizure and Sale of Property), Article VIII, Texas Constitution, by providing that once the property is sold pursuant to an ad valorem tax lien foreclosure, the delinquent taxpayer's liability is extinguished, regardless of whether the proceeds satisfy the judgement or not. Also allows the legislature to establish limitations on avoidance of a tax sale and may provide that a purchaser may conclusively rely upon the validity of the tax sale to foreclose all interests in the property, subject to the right of redemption as provided by applicable law. SECTION 2. Election Date: November 7, 1995; Establishes ballot language. COMPARISON OF ORIGINAL TO SUBSTITUTE H.J.R. 106 would force taxing units to choose whether to file suit for personal liability or lien foreclosure, but not both. C.S.H.J.R. 106 does not contain this provision. C.S.H.J.R. 106 also contains language allowing the legislature to establish limitations on avoidance of a tax sale, and may provide that a purchaser may conclusively rely upon the validity of the tax sale to foreclose all interests in the property, subject to the right of redemption. SUMMARY OF COMMITTEE ACTION Public notice was posted in accordance with the rules, and a public hearing was held on April 11, 1995. Representative Harris explained the bill. Without objection, H.J.R. 106 was left pending before the committee. On April 24, 1995, the committee met in a public hearing, and H.J.R. 106 was laid out on pending business. The committee considered a complete substitute by Representative Craddick. The Committee considered amendment #1 to the substitute by Representative Craddick. Without objection, the committee adopted committee amendment #1. The Chair directed the committee staff to incorporate committee amendment #1 into the substitute. Without objection, the committee adopted C.S.H.J.R. 106. By a record vote of 7 ayes, 0 nays, 0 present not voting and 4 absent, the committee voted to report H.J.R. 106 to the House as substituted with the recommendation that it do pass. Testimony received in favor of the bill (4/11/95): Ray M. Cornett, representing the Tax Assessor/Collector Assn. of Texas Roy C. Powers, representing himself Testimony received against the bill (4/11/95): Jeaniene Cadena, representing the Texas Municipal League