BILL ANALYSIS



S.B. 642
By: Montford (Holzheauser)
May 8, 1995
Committee Report (Amended)


BACKGROUND

The Comptroller is responsible for administering certain provision
of property tax laws.  Currently, the Comptroller serves as an
agent for non-resident delinquent property taxpayers.  This
responsibility is similar to the Secretary of State's role as agent
for service under several sections in the Civil Practice and
Remedies Code and other statutes.

Section 11.86, Education Code, requires the Comptroller to conduct
a property value study using generally accepted techniques to
determine the total taxable value for each school district.  The
Comptroller certifies these taxable values to the Commissioner of
Education for use in the state's school funding formula. 
Currently, the Comptroller is required to audit its value findings
on a school district request.  The audit is required regardless of
whether the school district has exhausted administrative remedies.

Section 825.405, Government Code, requires the Comptroller to issue
a report on school district effective tax rates to the Teachers'
Retirement System by June 7.  There could be instances when the
study is not certified by June 7.

PURPOSE

This bill proposes changes to the property tax code as follows:

     * Transfer out-of-state delinquent citation functions from the
Comptroller to the Secretary    of State.
     * Provide the Comptroller discretion in allowing an audit of
Comptroller property value      study results requested by a school
district.
     * Change the reporting date for the Comptroller's report on
school district effective tax        rates to the Teachers'
Retirement System.
     * Change references of "Federal Land Bank of Houston" to
"Federal Land Bank of Texas     or its successor" to reflect a name
change.
     * Change the period for back assessing erroneously granted
special appraisal for timber;        recreational, park and scenic
land; and public access airport property from 10 to 5 years.
     * Delete references to repealed section of the Tax Code.
     * Consolidate two sections of the Tax Code allowing waiver of
penalties and interest into     one section.

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 Sections 17.091 (Substituted Service in
Delinquent Tax Cases), Subsections (a), (b) and (e), Civil Practice
and Remedies Code, by transferring out-of-state delinquent citation
functions from the Comptroller to the Secretary of State and by
changing the current fee of $25 charged for services of process to
the standard fee of $40 collected by the Secretary of State for
similar service.

SECTION 2.  Amends Sections 11.86 (Determination of School District
Property Values), Subsection (d), Education Code, by giving the
Comptroller discretion to perform a school district requested audit
of Comptroller property value study results.

SECTION 3.  Amends Section 825.405 (Contributions Based on
Compensation Above Statutory Minimum), Subsection (i), Government
Code, by changing the reporting date for the Comptroller's report
on school district effective tax rates to the Teachers' Retirement
system from June 7th to not later than the seventh day after final
certification of property value study results to the Commissioner
of Education.

SECTION 4.  Amends Section 23.53 (Capitalization Rate), Tax Code,
by changing "Federal Land Bank of Houston" to "Farm Credit Bank of
Texas or its successor."

SECTION 5.  Amends Section 23.74 (Capitalization Rate), Tax Code,
by changing "Federal Land Bank of Houston" to "Farm Credit Bank of
Texas or its successor."

SECTION 6.  Amends Subchapter E (Appraisal of Timber Land), Section
23.75(j), Tax Code, by changing the period for back assessing
erroneously allowed appraisals from 10 to 5 years for timber land.

SECTION 7.  Amends Subchapter F (Appraisal of Recreational, Park
and Scenic Land), Section 23.84(e), Tax Code, by changing the
period for back assessing erroneously allowed appraisals from 10 to
5 years for recreational, park and scenic land.

SECTION 8.  Amends Subchapter G (Appraisal of Public Access Airport
Property), Section 23.94(e), Tax Code, by changing the period for
back assessing erroneously allowed appraisals from 10 to 5 years
for public access airport property.

SECTION 9.  Amends Section 25.06 (Property Encumbered by Possessory
or Security Interest), Tax Code, by deleting references to repealed
Section 25.15, Tax Code.

SECTION 10.  Amends Section 32.07 (Personal Liability for Tax),
Subsection (b), Tax Code, by deleting references to repealed
Section 25.15, Tax Code.

SECTION 11.  Amends Section 33.011 (Waivers of Penalties and
Interest), Tax Code, by transferring Section 31.015 (Certain Tax
Bills: Penalty and Interest Excluded), Tax Code, to it and by
providing that the governing body of the taxing unit shall
conditionally waive penalties and interest, and by substituting
"taxpayer" for "property owner."

SECTION 12.  Section 1 of the Act applies only to service of
process in a suit filed on or after the effective date of this Act.

SECTION 13.  Effective date: January 1, 1996.

SECTION 14.  Emergency clause. 

EXPLANATION OF AMENDMENTS

COMMITTEE AMENDMENT #1 amends Section 11 of the bill to change
references of "taxpayer" to "property owner."  The current law uses
"property owner" and this amendment would maintain that language.

SUMMARY OF COMMITTEE ACTION

On April 27, 1995, the committee met in a formal meeting and
considered S.B. 642.  The committee considered committee amendment
#1 by Representative Holzheauser.  Without objection, the amendment
was adopted.  By a record vote of 8 ayes, 0 nays, 0 present not
voting and 3 absent, the committee voted to report S.B. 642 to the
House with amendment with the recommendation that it do pass.