LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  May 5, 1997
         
         
      TO: Honorable Tom Craddick, Chair            IN RE:  House Bill No. 2669, Committee Report 1st House, Substituted
          Committee on Ways & Means                              By: Patterson,L.P. "Pete"
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on HB2669 ( (Relating 
to the appraisal for ad valorem tax purposes of land that does 
not have any valuable use because of a restriction imposed by 
a governmental entity.) this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by HB2669-Committee Report 1st House, Substituted
         
Section 403.302 of the Government Code requires the Comptroller 
to conduct a property value study to determine the total taxable 
value for each school district.  Total taxable value is an element 
in the state's school funding formula.  Passage of the bill 
could cause a reduction in school district taxable values reported 
to the Commissioner of Education by the Comptroller.  Based 
on current public education funding formulas, a reduction in 
school district property values could increase the state's cost 
of public education.
         

         
 
FISCAL ANALYSIS
The bill would amend Chapter 23 of the Tax 
Code to require a chief appraiser to appraise land at a nominal 
value if:  the use of the land was subject to a restriction 
imposed by a governmental entity, including a restriction to 
preserve wildlife habitat; the owner of the land had not consented 
to the restriction; and the effect of the restriction was to 
prohibit all valuable uses of the land.  The bill would provide 
for a five year recapture of taxes, plus interest, if the property 
is sold for more than the nominal value.
 
The bill would 
take effect January 1, 1998.
          
LOCAL
The bill could reduce revenues to local governments, 
depending on the amount of property receiving reduced appraisals, 
and the value of the land before governmental restrictions were 
imposed.
          
   Source:            Agencies:   
                                         
                      LBB Staff:   JK ,RR ,BR