By Hochberg                                           H.B. No. 2075
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the public notice required to be provided by a school
 1-3     district before adopting a proposed budget and tax rate.
 1-5           SECTION 1.  Section 44.004, Education Code, is amended to
 1-6     read as follows:
 1-8     ADOPTION.  (a)  When the budget has been prepared under Section
 1-9     44.002, the president shall call a meeting of the board of trustees
1-10     for[, stating that] the purpose of adopting [the meeting is the
1-11     adoption of] a budget for the succeeding fiscal year.
1-12           (b)  The president shall provide for the publication of
1-13     notice of the budget and proposed tax rate meeting in a daily,
1-14     weekly, or biweekly newspaper published in the district.  If no
1-15     daily, weekly, or biweekly newspaper is published in the district,
1-16     the president shall provide for the publication of notice in at
1-17     least one newspaper of general circulation in the county in which
1-18     the district's central administrative office is located.  [Notice
1-19     published under this subsection is in addition to notice required
1-20     by other law.]  Notice under this subsection shall be published not
1-21     earlier than the 30th day or later than the 10th day before the
1-22     date of the hearing.  [A district may include the notice required
1-23     under this subsection in a notice required under Section 26.06, Tax
1-24     Code.]
 2-1           (c)  The notice of public meeting to discuss and adopt the
 2-2     budget and the proposed tax rate may not be smaller than
 2-3     one-quarter page of a standard-size or a tabloid-size newspaper,
 2-4     and the headline on the notice must be in 18-point or larger type.
 2-5     Subject to Subsection (d), the notice must:
 2-6                 (1)  contain a statement in the following form:
 2-8                            AND PROPOSED TAX RATE
 2-9           "The (name of school district) will hold a public meeting at
2-10     (time, date, year) in (name of room, building, physical location,
2-11     city, state). The purpose of this meeting is to discuss the school
2-12     district's budget that will determine the tax rate that will be
2-13     adopted.  Public  participation in the discussion is invited."  The
2-14     statement of the purpose of the meeting must be in bold type.  In
2-15     reduced type, the notice must state:  "The tax rate that is
2-16     ultimately adopted at this meeting or at a separate meeting at a
2-17     later date may not exceed the proposed rate shown below without
2-18     publication of a revised notice containing the same information and
2-19     comparisons set out below.";
2-20                 (2)  contain a section entitled "Comparison of Proposed
2-21     Rates with Preceding Year's Adopted Rates," which must:
2-22                       (A)  show in rows the tax rates described by
2-23     Subparagraphs (i)-(iii), expressed as amounts per $100 valuation of
2-24     property, for columns entitled "Maintenance & Operations Tax Rate,"
2-25     "Interest & Sinking Fund Tax Rate," and "Total Tax Rate," which is
2-26     the sum of the "Maintenance & Operations Tax Rate" and the
2-27     "Interest & Sinking Fund Tax Rate":
 3-1                             (i)  the school district's "Adopted Tax
 3-2     Rate for the Preceding Year";
 3-3                             (ii)  the "Tax Rate Required to Maintain
 3-4     the Same Level of Maintenance & Operations Revenue and Pay Debt
 3-5     Service," which:
 3-6                                            (a)  in the case of the
 3-7     "Maintenance & Operations Tax Rate," is the tax rate that, when
 3-8     applied to the current taxable value for the district as certified
 3-9     by the chief appraiser under Section 26.01, Tax Code, would impose
3-10     taxes in an amount that, when added to state funds to be
3-11     distributed to the district under Chapter 42, would provide the
3-12     same amount of maintenance and operations taxes and state funds
3-13     distributed under Chapter 42 per student in average daily
3-14     attendance for the applicable school year that was available to the
3-15     district in the preceding school year; and
3-16                                            (b)  in the case of the
3-17     "Interest & Sinking Fund Tax Rate," is the tax rate that, when
3-18     applied to the current taxable value for the district as certified
3-19     by the chief appraiser under Section 26.01, Tax Code, and when
3-20     multiplied by the district's anticipated collection rate, would
3-21     impose taxes in an amount that, when added to state funds to be
3-22     distributed to the district under Chapter 46 and any excess taxes
3-23     collected to service the district's debt during the preceding year
3-24     but not used for that purpose during that year, would provide the
3-25     amount required to service the district's debt; and
3-26                             (iii)  the "Proposed Tax Rate";
3-27                       (B)  contain fourth and fifth columns aligned
 4-1     with the columns required by Paragraph (A) that show, for each row
 4-2     required by Paragraph (A):
 4-3                             (i)  the "Local Revenue per Student," which
 4-4     is computed by multiplying the district's total taxable value of
 4-5     property, as certified by the chief appraiser for the applicable
 4-6     school year under Section 26.01, Tax Code, by the "Total Tax Rate,"
 4-7     and dividing the product by the number of students in average daily
 4-8     attendance in the district for the applicable school year; and
 4-9                             (ii)  the "State Revenue per Student,"
4-10     which is computed by determining the amount of state aid received
4-11     or to be received by the district under Chapters 42, 43, and 46 and
4-12     dividing that amount by the number of students in average daily
4-13     attendance in the district for the applicable school year; and
4-14                       (C)  contain an asterisk after each calculation
4-15     for an "Interest & Sinking Fund Tax Rate" and a footnote to the
4-16     section that says "The Interest & Sinking Fund Tax Revenue is used
4-17     to pay for bonded indebtedness on construction, equipment, or both.
4-18     The bonds, and the tax rate necessary to pay those bonds, were
4-19     approved by the voters of this district in (an election or
4-20     elections) held (dates of election or elections).";
4-21                 (3)  contain a section entitled  "Comparison of
4-22     Proposed Levy with Last Year's Levy on Average Residence
4-23     Homestead," which must:
4-24                       (A)  show in rows the information described by
4-25     Subparagraphs (i)-(iv), rounded to the nearest dollar, for columns
4-26     entitled "Preceding Tax Year" and "Current Tax Year":
4-27                             (i)  "Average Appraised Value of Residence
 5-1     Homesteads," determined using the same group of residences for each
 5-2     year;
 5-3                             (ii)  "Average Taxable Value of Residence
 5-4     Homesteads, after Homestead Exemptions," determined using the same
 5-5     group of residences for each year;
 5-6                             (iii)  "Last Year's Rate Versus Proposed
 5-7     Rate per $100 of Property Value"; and
 5-8                             (iv)  "Taxes Imposed on Average Residence
 5-9     Homestead," determined using the same group of residences for each
5-10     year; and
5-11                       (B)  contain the following information:
5-12     "Increase (Decrease) in Taxes" expressed in dollars and cents,
5-13     which is computed by subtracting the "Taxes Imposed on Average
5-14     Residence Homestead" for the preceding tax year from the "Taxes
5-15     Imposed on Average Residence Homestead" for the current tax year;
5-16                 (4)  contain the following statement in bold print:
5-17     "Under state law, the dollar amount of school taxes imposed on the
5-18     residence homestead of a person 65 years of age or older or of the
5-19     surviving spouse of such a person, if the surviving spouse was 55
5-20     years of age or older when the person died, may not be increased
5-21     above the amount paid in the first year after the person turned 65,
5-22     regardless of changes in tax rate.";
5-23                 (5)  contain the following statement in bold print:
5-24     "Notice of Rollback Rate: The highest tax rate the district can
5-25     adopt before requiring voter approval at an election is (the school
5-26     district rollback rate determined under Section 26.08, Tax Code).
5-27     This election will be automatically held if the district adopts a
 6-1     rate in excess of the rollback rate of (the school district
 6-2     rollback rate)."; and
 6-3                 (6)  contain a section entitled "Fund Balances," which
 6-4     must include:
 6-5                       (A)  the estimated total fund balances that are
 6-6     not encumbered by a corresponding debt obligation and that will be
 6-7     left in the district's property tax accounts at the end of the
 6-8     fiscal year; or
 6-9                       (B)  the estimated fund balances in the following
6-10     categories that cumulatively equal the amount described by
6-11     Paragraph (A):
6-12                             (i)  fund balances to be spent in the
6-13     budget for the next fiscal year;
6-14                             (ii)  fund balances designated by the board
6-15     of trustees at a public meeting to be set aside for construction,
6-16     cash flow, or other specified purposes; and
6-17                             (iii)  other nondesignated fund balances.
6-18           (d)  The comptroller by rule shall prescribe the language and
6-19     format to be used in the part of the notice required by Subsection
6-20     (c).  A notice under Subsection (c) is not valid if it does not
6-21     substantially conform to the language and format prescribed by the
6-22     comptroller under this subsection.
6-23           (e)  The board of trustees, at the meeting called for that
6-24     purpose, shall adopt a budget to cover all expenditures for the
6-25     school district for the next succeeding fiscal year.  Any taxpayer
6-26     of the district may be present and participate in the meeting
6-27     [hearing].
 7-1           (f) [(d)]  The budget must be adopted before the adoption of
 7-2     the tax rate for the tax year in which the fiscal year covered by
 7-3     the budget begins.
 7-4           SECTION 2.  Section 26.05(d), Tax Code, is amended to read as
 7-5     follows:
 7-6           (d)  The governing body may not adopt a tax rate that if
 7-7     applied to the total taxable value would impose an amount of taxes
 7-8     that exceeds last year's levy until it has held a public hearing on
 7-9     the proposed tax rate and:
7-10                 (1)  if the taxing unit is not a school district, has
7-11     otherwise complied with Section 26.06; or
7-12                 (2)  if the taxing unit is a school district, has
7-13     complied with Section 44.004, Education Code.
7-14           SECTION 3.  Section 26.06, Tax Code, is amended by adding
7-15     Subsection (g) to read as follows:
7-16           (g)  This section does not apply to a school district.  A
7-17     school district shall provide notice of a public meeting on a tax
7-18     increase as required by Section 44.004, Education Code.
7-19           SECTION 4.  This Act takes effect September 1, 1999.
7-20           SECTION 5.  The importance of this legislation and the
7-21     crowded condition of the calendars in both houses create an
7-22     emergency and an imperative public necessity that the
7-23     constitutional rule requiring bills to be read on three several
7-24     days in each house be suspended, and this rule is hereby suspended.