By Merritt                                             H.J.R. No. 5
         76R7337 SMH-D                           
                                 A JOINT RESOLUTION
 1-1     proposing a constitutional amendment to limit increases in the
 1-2     appraised value of real property for ad valorem tax purposes.
 1-3           BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.   Section 1, Article VIII, Texas Constitution, is
 1-5     amended by amending Subsection (i) and adding Subsections (j), (k),
 1-6     and (l) to read as follows:
 1-7           (i)  The appraised value of real property, other than real
 1-8     property appraised as provided by Section 1-d or 1-d-1 of this
 1-9     article, for ad valorem tax purposes for the first tax year after
1-10     the tax year in which the owner acquires the property may not
1-11     exceed the market value of the property.  Notwithstanding
1-12     Subsections (a) and (b) of this section, the appraised value of the
1-13     property in each subsequent tax year until the end of the tax year
1-14     in which the ownership of the property changes may not exceed the
1-15     sum of:
1-16                 (1)  the appraised value of the property for tax
1-17     purposes for the preceding year as adjusted by the appraisal office
1-18     for the current tax year to reflect the change from the preceding
1-19     tax year in the purchasing power of the dollar for consumers in the
1-20     region of this State in which the property is located; and
1-21                 (2)  the market value of all new improvements to the
1-22     property [Notwithstanding Subsections (a) and (b) of this section,
1-23     the Legislature by general law may limit the maximum average annual
1-24     percentage increase in the appraised value of residence homesteads
 2-1     for ad valorem tax purposes to 10 percent, or a greater percentage,
 2-2     for each year since the most recent tax appraisal.  A limitation on
 2-3     appraisal increases authorized by this subsection:]
 2-4                 [(1)  takes effect as to a residence homestead on the
 2-5     later of the effective date of the law imposing the limitation or
 2-6     January 1 of the tax year following the first tax year the owner
 2-7     qualifies the property for an exemption under Section 1-b of this
 2-8     article; and]
 2-9                 [(2)  expires on January 1 of the first tax year that
2-10     neither the owner of the property when the limitation took effect
2-11     nor the owner's spouse or surviving spouse qualifies for an
2-12     exemption under Section 1-b of this article].
2-13           (j)  In Subsection (i) of this section, "new improvement"
2-14     means an improvement to real property that is made after the
2-15     appraisal of the property for the preceding tax year and that
2-16     increases the market value of the property.  The term does not
2-17     include ordinary maintenance of an existing structure or the
2-18     grounds or another feature of the property.
2-19           (k)  For each tax year, using the index that the Comptroller
2-20     of Public Accounts considers to most accurately report changes in
2-21     the purchasing power of the dollar for consumers in each region of
2-22     this State as specified by the Legislature, the comptroller shall
2-23     determine and publicize the percentage by which the appraised value
2-24     of real property may be increased under Subsection (i)(1) of this
2-25     section.  Each appraisal office shall use the applicable percentage
2-26     determined by the comptroller under this subsection to determine
2-27     the maximum increase in the appraised value of real property
 3-1     appraised by that appraisal office.
 3-2           (l)  For purposes of Subsection (i) of this section, the
 3-3     owner of real property on January 1, 2000, is considered to have
 3-4     acquired the property in the 1999 tax year.
 3-5           SECTION 2.  The following temporary provision is added to the
 3-6     Texas Constitution:
 3-7           TEMPORARY PROVISION.  (a)  This temporary provision applies
 3-8     to the constitutional amendment proposed by __J.R. No. __, 76th
 3-9     Legislature, Regular Session, 1999, and expires January 1, 2002.
3-10           (b)  The amendment takes effect January 1, 2000.
3-11           SECTION 3.  This proposed constitutional amendment shall be
3-12     submitted to the voters at an election to be held November 2, 1999.
3-13     The ballot shall be printed to permit voting for or against the
3-14     proposition: "The constitutional amendment to limit increases in
3-15     the appraised value of real property for ad valorem tax purposes."