By Longoria                                      H.B. No. 371

      75R953 SMH-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to limitations on the frequency with which increases in

 1-3     the appraised value of real property for ad valorem tax purposes

 1-4     may be recognized.

 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-6           SECTION 1.  Subchapter B, Chapter 23, Tax Code, is amended by

 1-7     adding Section 23.21 to read as follows:

 1-8           Sec. 23.21.  REAL PROPERTY.  (a)  Except as provided by

 1-9     Subsection (b), the chief appraiser may not recognize an increase

1-10     in the appraised value of real property more than once every five

1-11     years.

1-12           (b)  The chief appraiser shall recognize an increase in the

1-13     appraised value of real property before the fifth anniversary of

1-14     the date of the preceding recognition of an increase in the

1-15     appraised value of the property if, after that date, the property

1-16     owner makes an improvement to the property that increases the

1-17     market value of the property at least 10 percent.

1-18           (c)  An application is not required for an owner of real

1-19     property to receive a benefit under this section.

1-20           (d)  The chief appraiser shall include in the appraisal

1-21     records both the market value of real property and its appraised

1-22     value as determined by this section.

1-23           (e)  This section does not apply to property appraised under

1-24     Subchapter C, D, E, F, or G.

 2-1           SECTION 2.  Section 1.12, Tax Code, is amended by adding

 2-2     Subsection (d) to read as follows:

 2-3           (d)  For purposes of this section, the appraisal ratio of

 2-4     real property appraised under Section 23.21 is the ratio of the

 2-5     property's market value as determined by the appraisal district or

 2-6     appraisal review board, as applicable, to the market value of the

 2-7     property according to law.  The appraisal ratio is not calculated

 2-8     according to the appraised value of the property as provided by

 2-9     Section 23.21.

2-10           SECTION 3.  Section 25.18(b), Tax Code, is amended to read as

2-11     follows:

2-12           (b)  The plan shall provide for reappraisal of all real

2-13     property in the district at least once every five [three] years.

2-14           SECTION 4.  Section 403.302(d), Government Code, is amended

2-15     to read as follows:

2-16           (d)  For the purposes of this section, "taxable value" means

2-17     market value less:

2-18                 (1)  the total dollar amount of any exemptions of part

2-19     but not all of the value of taxable property required by the

2-20     constitution or a statute that a district lawfully granted in the

2-21     year that is the subject of the study;

2-22                 (2)  the total dollar amount of any exemptions granted

2-23     before May 31, 1993, within a reinvestment zone under agreements

2-24     authorized by Chapter 312, Tax Code;

2-25                 (3)  the total dollar amount of any captured appraised

2-26     value of property that is located in a reinvestment zone and that

2-27     is eligible for tax increment financing under Chapter 311, Tax

 3-1     Code;

 3-2                 (4)  the total dollar amount of any exemptions granted

 3-3     under Section 11.251, Tax Code;

 3-4                 (5)  the difference between the market value and the

 3-5     productivity value of land that qualifies for appraisal on the

 3-6     basis of its productive capacity, except that the productivity

 3-7     value may not exceed the fair market value of the land;

 3-8                 (6)  the portion of the appraised value of residence

 3-9     homesteads of the elderly on which school district taxes are not

3-10     imposed in the year that is the subject of the study, calculated as

3-11     if the residence homesteads were appraised at the full value

3-12     required by law;

3-13                 (7)  a portion of the market value of property not

3-14     otherwise fully taxable by the district at market value because of

3-15     action required by statute or the constitution of this state that,

3-16     if the tax rate adopted by the district is applied to it, produces

3-17     an amount equal to the difference between the tax that the district

3-18     would have imposed on the property if the property were fully

3-19     taxable at market value and the tax that the district is actually

3-20     authorized to impose on the property; [and]

3-21                 (8)  the market value of all tangible personal

3-22     property, other than manufactured homes, owned by a family or

3-23     individual and not held or used for the production of income; and

3-24                 (9)  the amount by which the market value of real

3-25     property to which Section 23.21, Tax Code, applies exceeds the

3-26     appraised value of that property under that section.

3-27           SECTION 5.  This Act takes effect January 1, 1998, but only

 4-1     if the constitutional amendment proposed by the 75th Legislature,

 4-2     Regular Session, 1997, to require the legislature to limit the

 4-3     frequency with which increases in the appraised value of real

 4-4     property for ad valorem tax purposes may be recognized is approved

 4-5     by the voters.  If the proposed constitutional amendment is not

 4-6     approved by the voters, this Act has no effect.

 4-7           SECTION 6.  The importance of this legislation and the

 4-8     crowded condition of the calendars in both houses create an

 4-9     emergency and an imperative public necessity that the

4-10     constitutional rule requiring bills to be read on three several

4-11     days in each house be suspended, and this rule is hereby suspended.