By Smith                                        H.B. No. 2044

      75R5446 JD-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to notice that a municipality must provide before holding

 1-3     a public hearing on the adoption of an ad valorem tax increase.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Section 26.05(d), Tax Code, is amended to read as

 1-6     follows:

 1-7           (d)  The governing body may not adopt a tax rate that exceeds

 1-8     the lower of the rollback tax rate or 103 percent of the effective

 1-9     tax rate calculated as provided by Section 26.04 of this code until

1-10     it has held a public hearing on the proposed increase and has

1-11     otherwise complied with Section 26.06 or 26.065 of this code.  The

1-12     governing body of a taxing unit shall reduce a tax rate set by law

1-13     or by vote of the electorate to the lower of the rollback tax rate

1-14     or 103 percent of the effective tax rate and may not adopt a higher

1-15     rate unless it first complies with Section 26.06 or 26.065 of this

1-16     code.

1-17           SECTION 2.  Chapter 26, Tax Code, is amended by adding

1-18     Section 26.065 to read as follows:

1-19           Sec. 26.065.  NOTICE OF HEARING ON MUNICIPAL TAX INCREASE.

1-20     (a)  Sections 26.05(b) and (c) do not apply to a municipality.  The

1-21     governing body of a municipality required to hold a public hearing

1-22     by Section 26.05(d) shall:

1-23                 (1)  publish a notice of the public hearing in the

1-24     newspaper of general circulation in the municipality that has the

 2-1     highest subscription rate in the municipality; and

 2-2                 (2)  mail a copy of the notice to the household of each

 2-3     person who voted in the most recent general election for municipal

 2-4     officers conducted in the municipality, according to the voting

 2-5     records of the municipality.

 2-6           (b)  A notice required by Subsection (a)(1) may not be

 2-7     smaller than one-quarter page of the standard-size page of the

 2-8     newspaper in which the notice is required to be published, and the

 2-9     headline on the notice must be in 18-point or larger type.  The

2-10     notice required by Subsection (a)(1) may not be published in the

2-11     part of the newspaper in which legal notices or classified

2-12     advertisements appear.

2-13           (c)  The notice must contain a statement in the following

2-14     form:

2-15            "NOTICE OF PUBLIC HEARING ON MUNICIPAL TAX INCREASE"

2-16           "The governing body of (name of municipality) will hold a

2-17     public hearing on a proposal to increase total tax revenues from

2-18     properties on the tax roll in (the preceding year) by (percentage

2-19     by which the proposed tax rate exceeds the lower of the

2-20     municipality's effective or rollback tax rate) percent.  Your

2-21     individual (name of municipality) taxes may increase at a greater

2-22     or lesser rate, or even decrease, depending on the change in the

2-23     taxable value of your property in relation to the change in taxable

2-24     value of all other property subject to taxation by (name of

2-25     municipality).

2-26           "The governing body of (name of municipality) will hold the

2-27     public hearing on (date and time) at (meeting place)."

 3-1           (d)  Notwithstanding Section 26.06(a), the governing body of

 3-2     the municipality may not hold the public hearing required by

 3-3     Section 26.05 before the seventh day after the later of:

 3-4                 (1)  the date that the notice required by Subsection

 3-5     (a)(1) is published; or

 3-6                 (2)  the earliest date on which all or substantially

 3-7     all the notices required by Subsection (a)(2) have been mailed.

 3-8           SECTION 3.  This Act takes effect January 1, 1998.

 3-9           SECTION 4.  The importance of this legislation and the

3-10     crowded condition of the calendars in both houses create an

3-11     emergency and an imperative public necessity that the

3-12     constitutional rule requiring bills to be read on three several

3-13     days in each house be suspended, and this rule is hereby suspended.