By: Barrientos S.B. No. 1804
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the calculation of a tax rollback rate.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Section 26.04, Tax Code, is amended by amending
1-4 Subsections (e), (i), and (j), and adding Subsections (k) and (l)
1-5 to read as follows:
1-6 (e) By August 7 or as soon thereafter as practicable, the
1-7 designated officer or employee shall submit the rates to the
1-8 governing body. He shall deliver by mail to each property owner in
1-9 the unit or publish in a newspaper in the form prescribed by the
1-10 comptroller:
1-11 (1) the effective tax rate, the rollback tax rate, and
1-12 an explanation of how they were calculated;
1-13 (2) the estimated amount of interest and sinking fund
1-14 balances and the estimated amount of maintenance and operation or
1-15 general fund balances remaining at the end of the current fiscal
1-16 year that are not encumbered with or by corresponding existing debt
1-17 obligation, except that for a school district, estimated funds
1-18 necessary for the operation of the district prior to the receipt of
1-19 the first state education aid payment in the succeeding school year
1-20 shall be subtracted from the estimated fund balances;
1-21 (3) a schedule of the unit's debt obligations showing:
1-22 (A) the amount of principal and interest that
1-23 will be paid to service the unit's debts in the next year from
1-24 property tax revenue, including payments of lawfully incurred
2-1 contractual obligations providing security for the payment of the
2-2 principal of and interest on bonds and other evidences of
2-3 indebtedness issued on behalf of the unit by another political
2-4 subdivision and, if the unit is created under Section 52, Article
2-5 III, or Section 59, Article XVI, Texas Constitution, payments on
2-6 debts that the unit anticipates to incur in the next calendar year;
2-7 (B) the amount by which taxes imposed for debt
2-8 are to be increased because of the unit's anticipated collection
2-9 rate; and
2-10 (C) the total of the amounts listed in
2-11 Paragraphs (A)-(B), less any amount collected in excess of the
2-12 previous year's anticipated collections certified as provided in
2-13 Subsection (b); and
2-14 (4) the amount of additional sales and use tax revenue
2-15 anticipated in calculations under Section 26.041;[.]
2-16 (5) in the year that a taxing unit calculates an
2-17 adjustment under Subsection (i) or (j), the unit shall publish a
2-18 schedule that includes the following elements:
2-19 (A) the name of the unit transferring
2-20 responsibility for funding of [discontinuing] the department,
2-21 function, or activity;
2-22 (B) the amount of property tax revenue spent by
2-23 the unit listed under Paragraph (A) to operate the [discontinued]
2-24 department, function, or activity in the 12 months preceding the
2-25 month in which the calculations required by this chapter are made;
2-26 and
3-1 (C) the name of the unit that accepts funding
3-2 responsibility for [operates] a distinct department, function, or
3-3 activity in all or a majority of the territory of a taxing unit
3-4 that has transferred responsibility for funding of [discontinued
3-5 operating] the distinct department, function, or activity; and
3-6 (6) in the year following the year in which a taxing
3-7 unit raised its rollback rate as required by Subsection (j), the
3-8 taxing unit shall publish a schedule that includes the following
3-9 elements:
3-10 (A) the amount of property tax revenue spent by
3-11 the unit to fund [operate] the department, function, or activity
3-12 for which the taxing unit raised the rollback rate as required by
3-13 Subsection (j) for the 12 months preceding the month in which the
3-14 calculations required by this chapter are made; and
3-15 (B) the amount published by the unit in the
3-16 preceding tax year under Subdivision (5)(B).
3-17 (i) This subsection applies to a taxing unit that has agreed
3-18 by written contract to transfer all or part of the responsibility
3-19 for funding a distinct department, function, or activity to another
3-20 taxing unit and reduces its taxation for the purpose of funding
3-21 [discontinues operating] that distinct department, function, or
3-22 activity if that reduced portion of the funding [operation] of that
3-23 department, function, or activity in all or a majority of the
3-24 territory of the taxing unit is continued by another existing
3-25 taxing unit or by a new taxing unit. The rollback tax rate of a
3-26 taxing unit to which this subsection applies in the first tax year
4-1 in which a budget is adopted that reduces [does not allocate
4-2 revenue to] the funding of the [discontinued] department, function,
4-3 or activity is calculated as otherwise provided by this section,
4-4 except that last year's levy used to calculate the effective
4-5 maintenance and operations rate of the unit is reduced by the
4-6 decrease in the amount of maintenance and operations tax revenue
4-7 spent by the taxing unit on [to operate] the department, function,
4-8 or activity compared to the amount of maintenance and operations
4-9 tax revenue spent in [for] the 12 months preceding the month in
4-10 which the calculations required by this chapter are made [and in
4-11 which the unit operated the discontinued department, function, or
4-12 activity]. If the unit did not fund all or part of [operate] that
4-13 department, function, or activity for the full 12 months preceding
4-14 the month in which the calculations required by this chapter are
4-15 made, the unit shall reduce last year's levy used for calculating
4-16 the effective maintenance and operations rate of the unit by the
4-17 amount of the decrease in the amount of maintenance and operations
4-18 tax compared to the amount of revenue spent in the last full fiscal
4-19 year in which the unit funded all or part of [operated] the
4-20 [discontinued] department, function, or activity.
4-21 (j) This subsection applies to a taxing unit that had agreed
4-22 by written contract to accept the transfer of all or part of the
4-23 responsibility for funding a distinct department, function, or
4-24 activity from another taxing unit and funds all or part of
4-25 [operates] a distinct department, function, or activity if the
4-26 funding for [operation of] a substantially similar department,
5-1 function, or activity in all or a majority of the territory of the
5-2 taxing unit has been reduced [discontinued] by another taxing unit,
5-3 including a dissolved taxing unit. The rollback tax rate of a
5-4 taxing unit to which this subsection applies in the first tax year
5-5 after the other taxing unit reduced the funding of [discontinued]
5-6 the substantially similar department, function, or activity in
5-7 which a budget is adopted that allocates revenue to the department,
5-8 function, or activity is calculated as otherwise provided by this
5-9 section, except that last year's levy used to calculate the
5-10 effective maintenance and operations rate of the unit is increased
5-11 by the amount of the decrease of maintenance and operations tax
5-12 revenue spent by the taxing unit that reduced funding for
5-13 [discontinued operating] the substantially similar department,
5-14 function, or activity compared to the amount of maintenance and
5-15 operations tax revenue spent on [to operate] that department,
5-16 function, or activity in [for] the 12 months preceding the month in
5-17 which the calculations required by this chapter are made [and in
5-18 which the unit operated the discontinued department, function, or
5-19 activity]. If the unit did not fund [operate] the [discontinued]
5-20 department, function, or activity for the full 12 months preceding
5-21 the month in which the calculations required by this chapter are
5-22 made, the unit may increase last year's levy used to calculate the
5-23 effective maintenance and operations rate by an amount not to
5-24 exceed the decrease in the amount of property tax revenue spent by
5-25 the other [discontinuing] unit to fund [operate] the [discontinued]
5-26 department, function, or activity compared to the amount of
6-1 maintenance and operations tax revenue spent in the last full
6-2 fiscal year before [in which] the other [discontinuing] unit
6-3 reduced funding for [operated] the department, function, or
6-4 activity.
6-5 (k) As the term is used in Subsections (i) and (j),
6-6 "funding" includes a payment made to another taxing unit through a
6-7 written contract for the operation of the department, function, or
6-8 activity. The term does not include a payment made by a taxing
6-9 unit from funds received from another taxing unit through a written
6-10 contract to operate the department, function, or activity.
6-11 (l) Notwithstanding any other provision of this section, the
6-12 rollback tax rate of a taxing unit is increased or reduced under
6-13 Subsection (i) or (j) only in the amount of ad valorem tax revenue
6-14 spent by the taxing unit on that part of the funding of the
6-15 department, function, or activity that is assumed or discontinued
6-16 by the taxing authority. If the department, function, or activity
6-17 has been funded by revenue sources other than ad valorem taxes, the
6-18 taxing unit may use any reasonable method to calculate the amount
6-19 of ad valorem tax revenue that is or has been spent to fund the
6-20 department, function, or activity.
6-21 SECTION 2. This Act takes effect September 1, 1999.
6-22 SECTION 3. The importance of this legislation and the
6-23 crowded condition of the calendars in both houses create an
6-24 emergency and an imperative public necessity that the
6-25 constitutional rule requiring bills to be read on three several
6-26 days in each house be suspended, and this rule is hereby suspended.