By Craddick                                           H.J.R. No. 39
         76R3709 JD-D                           
                                 A JOINT RESOLUTION
 1-1     proposing a constitutional amendment exempting personal property in
 1-2     this state from ad valorem taxation.
 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 to read as follows:
 1-6           Sec. 1.   (a)  Taxation shall be equal and uniform.
 1-7           (b)  All real property [and tangible personal property] in
 1-8     this State, unless exempt as required or permitted by this
 1-9     Constitution, whether owned by natural persons or corporations,
1-10     other than municipal, shall be taxed in proportion to its value,
1-11     which shall be ascertained as may be provided by law.  All personal
1-12     property in this State is exempt from ad valorem taxation, except
1-13     as provided by Subsection (g) of this section.
1-14           (c)  The Legislature may [provide for the taxation of
1-15     intangible property and may also] impose occupation taxes, both
1-16     upon natural persons and upon corporations, other than municipal,
1-17     doing any business in this State.  Subject to the restrictions of
1-18     Section 24 of this article, it may also tax incomes of both natural
1-19     persons and corporations other than municipal.  Persons engaged in
1-20     mechanical and agricultural pursuits shall never be required to pay
1-21     an occupation tax.
1-22           (d)  [The Legislature by general law shall exempt from ad
1-23     valorem taxation household goods not held or used for the
1-24     production of income and personal effects not held or used for the
 2-1     production of income.  The Legislature by general law may exempt
 2-2     from ad valorem taxation:]
 2-3                 [(1)  all or part of the personal property homestead of
 2-4     a family or single adult, "personal property homestead" meaning
 2-5     that personal property exempt by law from forced sale for debt; and]
 2-6                 [(2)  subject to Subsections (e) and (g) of this
 2-7     section, all other tangible personal property, except structures
 2-8     which are personal property and are used or occupied as residential
 2-9     dwellings and except property held or used for the production of
2-10     income.]
2-11           [(e)  The governing body of a political subdivision, other
2-12     than a county education district, may provide for the taxation of
2-13     all property exempt under a law adopted under Subdivision (2) of
2-14     Subsection (d) of this section and not exempt from ad valorem
2-15     taxation by any other law.  In the manner provided by law, the
2-16     voters of a county education district at an election held for that
2-17     purpose may provide for the taxation of all property exempt under a
2-18     law adopted under Subdivision (2) of Subsection (d) of this section
2-19     and not exempt from ad valorem taxation by any other law.]
2-20           [(f)]  The occupation tax levied by any county, city or town
2-21     for any year on persons or corporations pursuing any profession or
2-22     business, shall not exceed one half of the tax levied by the State
2-23     for the same period on such profession or business.
2-24           [(g)  The Legislature may exempt from ad valorem taxation
2-25     tangible personal property that is held or used for the production
2-26     of income and has a taxable value of less than the minimum amount
2-27     sufficient to recover the costs of the administration of the taxes
 3-1     on the property, as determined by or under the general law granting
 3-2     the exemption.]
 3-3           (e) [(h)]  The Legislature may exempt from ad valorem
 3-4     taxation a mineral interest that has a taxable value of less than
 3-5     the minimum amount  sufficient to recover the costs of the
 3-6     administration of the taxes on the interest, as determined by or
 3-7     under the general law granting the exemption.
 3-8           (f) [(i)]  Notwithstanding Subsections (a) and (b) of this
 3-9     section, the Legislature by general law may limit the maximum
3-10     average annual percentage increase in the appraised value of
3-11     residence homesteads for ad valorem tax purposes to 10 percent, or
3-12     a greater percentage, for each year since the most recent tax
3-13     appraisal.  A limitation on appraisal increases authorized by this
3-14     subsection:
3-15                 (1)  takes effect as to a residence homestead on the
3-16     later of the effective date of the law imposing the limitation or
3-17     January 1 of the tax year following the first tax year the owner
3-18     qualifies the property for an exemption under Section 1-b of this
3-19     article; and
3-20                 (2)  expires on January 1 of the first tax year that
3-21     neither the owner of the property when the limitation took effect
3-22     nor the owner's spouse or surviving spouse qualifies for an
3-23     exemption under Section 1-b of this article.
3-24           (g)  If before November 2, 1999, an ad valorem tax on
3-25     personal property is pledged for the payment of a debt, the
3-26     appropriate tax  authorities may continue to levy and collect the
3-27     tax against that personal property at the same rate as the pledged
 4-1     tax until the debt is discharged, if cessation of the levy and
 4-2     collection of the tax would impair the obligation of the contract
 4-3     by which the debt was created.  This subsection applies to personal
 4-4     property that was taxable under the law in effect on January 1,
 4-5     1999, but that became exempt under Subsection (b) of this section
 4-6     on January 1, 2000, as a result of the amendment of this section
 4-7     adopted by the voters in 1999 to exempt all personal property from
 4-8     ad valorem taxation.
 4-9           SECTION 2.  Section 1-l, Article VIII, Texas Constitution, is
4-10     amended to read as follows:
4-11           Sec. 1-l.  (a)  The legislature by general law may exempt
4-12     from ad valorem taxation all or part of real [and personal]
4-13     property used, constructed, acquired, or installed wholly or partly
4-14     to meet or exceed rules or regulations adopted by any environmental
4-15     protection agency of the United States, this state, or a political
4-16     subdivision of this state for the prevention, monitoring, control,
4-17     or reduction of air, water, or land pollution.
4-18           (b)  This section applies to real [and personal] property
4-19     used as a facility, device, or method for the control of air,
4-20     water, or land pollution that would otherwise be taxable for the
4-21     first time on or after January 1, 1994.
4-22           (c)  This section does not authorize the exemption from ad
4-23     valorem taxation of real [or personal] property that was subject to
4-24     a tax abatement agreement executed before January 1, 1994.
4-25           SECTION 3.  Section 5, Article VIII, Texas Constitution, is
4-26     amended to read as follows:
4-27           Sec. 5.  All real property of railroad companies, of whatever
 5-1     description, lying or being within the limits of any city or
 5-2     incorporated town within this State, shall bear its proportionate
 5-3     share of municipal taxation, and if any such real property shall
 5-4     not have been heretofore rendered, the authorities of the city or
 5-5     town within which it lies, shall have power to require its
 5-6     rendition, and collect the usual municipal tax thereon, as on other
 5-7     real property lying within said municipality.
 5-8           SECTION 4.  Section 8, Article VIII, Texas Constitution, is
 5-9     amended to read as follows:
5-10           Sec. 8.  All real property of railroad companies shall be
5-11     assessed, and the taxes collected in the several counties in which
5-12     said real property is situated, including so much of the roadbed
5-13     and fixtures as shall be in each county. [The rolling stock may be
5-14     assessed in gross in the county where the principal office of the
5-15     company is located, and the county tax paid upon it shall be
5-16     apportioned as provided by general law in proportion to the
5-17     distance such road may run through any such county, among the
5-18     several counties through which the road passes, as a part of their
5-19     tax assets.]
5-20           SECTION 5.  Article VIII, Texas Constitution, is amended by
5-21     adding the following temporary provision:
5-22           TEMPORARY PROVISION.  The constitutional amendment proposed
5-23     by the 76th Legislature, Regular Session, 1999, to exempt all
5-24     personal property from ad valorem taxation takes effect January 1,
5-25     2000, and applies only to taxes imposed on or after that date.
5-26     This temporary provision expires January 1, 2002.
5-27           SECTION 6.  Sections 1-i, 1-j, 19, and 19a, Article VIII,
 6-1     Texas Constitution, are repealed.
 6-2           SECTION 7.  This proposed constitutional amendment shall be
 6-3     submitted to the voters at an election to be held November 2, 1999.
 6-4     The ballot shall be printed to permit voting for or against the
 6-5     proposition: "The constitutional amendment exempting all personal
 6-6     property in this state from ad valorem taxation."