By Ellis S.B. No. 1249
75R7532 JD-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the sale of property for delinquent ad valorem taxes.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 33.54, Tax Code, is amended to read as
1-5 follows:
1-6 Sec. 33.54. LIMITATION ON ACTIONS RELATING TO PROPERTY SOLD
1-7 FOR TAXES. (a) Except as provided by Subsection (b) [of this
1-8 section], an [a cause of] action relating to the title to property
1-9 may not be maintained against the purchaser of the property at a
1-10 tax sale unless the action is commenced:
1-11 (1) before the first anniversary of the date that
1-12 [commences within three years after] the deed executed to the
1-13 purchaser at the tax sale is filed of record; or
1-14 (2) before the second anniversary of the date that the
1-15 deed executed to the purchaser is filed of record, if on the date
1-16 that the suit to collect the delinquent tax was filed the property
1-17 was:
1-18 (A) the residence homestead of the owner; or
1-19 (B) land appraised or eligible to be appraised
1-20 under Subchapter C or D, Chapter 23.
1-21 (b) If a person other than the purchaser at the tax sale or
1-22 the person's [his] successor in interest pays taxes on the property
1-23 during the applicable limitations period [three years following the
1-24 date the deed is filed] and that person was not served citation in
2-1 the suit to foreclose the tax lien, that [the three-year]
2-2 limitations period does not apply to that person.
2-3 (c) When actions are barred by this section, the purchaser
2-4 at the tax sale or the purchaser's [his] successor in interest has
2-5 [shall be held to have] full title to the property, precluding all
2-6 other claims.
2-7 SECTION 2. Section 34.05, Tax Code, is amended by amending
2-8 Subsections (b), (c), and (d), and adding Subsection (h) to read as
2-9 follows:
2-10 (b) Property [Unless the property is] sold pursuant to
2-11 Subsections (c) and (d) of this section[, it] may [not] be sold for
2-12 any [less than the market value specified in the judgment of
2-13 foreclosure or the total] amount [of the judgments against the
2-14 property, whichever is less, without the consent of each taxing
2-15 unit entitled to receive proceeds of the sale under the judgment.
2-16 Joinder of the taxing units in the conveyance of the property
2-17 constitutes consent. The presiding officer of the governing body
2-18 of a taxing unit may consent in behalf of the taxing unit]. This
2-19 subsection does not authorize a sale of property in violation of
2-20 Section 52, Article III, Texas Constitution.
2-21 (c) The taxing unit purchasing the property by resolution of
2-22 its governing body may request the sheriff to sell the property at
2-23 a public sale. If the purchasing taxing unit has not sold the
2-24 property within six months after the date on which the owner's
2-25 right of redemption terminates, any taxing unit that is entitled to
2-26 receive proceeds of the sale by resolution of its governing body
2-27 may request the sheriff in writing to sell the property at a public
3-1 sale. On receipt of a request made under this subsection, the
3-2 sheriff shall sell the property as provided by Subsection (d) of
3-3 this section, unless the property is sold pursuant to Subsection
3-4 (h) before the date set for the public sale.
3-5 (d) Except as provided by this subsection, all public sales
3-6 requested as provided by Subsection (c) of this section shall be
3-7 conducted in the manner prescribed by the Rules of Civil Procedure
3-8 for the sale of property under execution. The notice of the sale
3-9 must contain a description of the property to be sold, which must
3-10 be a legal description in the case of real property, the number and
3-11 style of the suit under which the property was sold at the tax
3-12 foreclosure sale, and the date of the tax foreclosure sale. [The
3-13 officer conducting the sale shall reject any bid for the property
3-14 if it is his judgment that the amount bid is insufficient. If all
3-15 bids are insufficient, the property shall be readvertised and
3-16 offered for sale again.] The acceptance of a bid by the officer
3-17 conducting the sale is conclusive and binding on the question of
3-18 its sufficiency. An action to set aside the sale on the grounds
3-19 that the bid is insufficient may not be sustained in court, except
3-20 that a taxing unit that participates in distribution of proceeds of
3-21 the sale may file an action within one year after the date of the
3-22 sale to set aside the sale on the grounds of fraud or collusion
3-23 between the officer making the sale and the purchaser.
3-24 (h) In lieu of a sale pursuant to Subsections (c) and (d),
3-25 the taxing unit that purchased the property may sell the property
3-26 at a private sale. Consent of each taxing unit entitled to receive
3-27 proceeds of the sale under the judgment is not required. Property
4-1 sold under this subsection may not be sold for an amount that is
4-2 less than the lesser of:
4-3 (1) the market value specified in the judgment of
4-4 foreclosure; or
4-5 (2) the total amount of the judgments against the
4-6 property.
4-7 SECTION 3. Subchapter A, Chapter 34, Tax Code, is amended by
4-8 adding Section 34.08 to read as follows:
4-9 Sec. 34.08. CHALLENGE TO VALIDITY OF TAX SALE. A person may
4-10 not commence an action that challenges the validity of a tax sale
4-11 under this chapter unless the person:
4-12 (1) deposits into the registry of the court an amount
4-13 equal to the amount of the delinquent taxes, penalties, and
4-14 interest specified in the judgment of foreclosure obtained against
4-15 the property plus all costs of the tax sale; or
4-16 (2) files an affidavit of inability to pay under Rule
4-17 145, Texas Rules of Civil Procedure.
4-18 SECTION 4. (a) This Act takes effect September 1, 1998.
4-19 (b) The changes in law made by Sections 1 and 3 of this Act
4-20 apply only to an action that relates to the title to property sold
4-21 for taxes or challenges the validity of a tax sale and that is
4-22 commenced on or after September 1, 1998. An action commenced
4-23 before September 1, 1998, is covered by the law in effect when the
4-24 property was sold, and the former law is continued in effect for
4-25 that purpose.
4-26 (c) The changes in law made by Section 2 of this Act apply
4-27 only to the resale of property by a taxing unit on or after
5-1 September 1, 1998. The resale of property by a taxing unit before
5-2 September 1, 1998, is covered by the law in effect when the
5-3 property was resold, and the former law is continued in effect for
5-4 that purpose.
5-5 SECTION 5. The importance of this legislation and the
5-6 crowded condition of the calendars in both houses create an
5-7 emergency and an imperative public necessity that the
5-8 constitutional rule requiring bills to be read on three several
5-9 days in each house be suspended, and this rule is hereby suspended.