1-1 By: Ogden S.B. No. 914
1-2 (In the Senate - Filed February 23, 2001; February 28, 2001,
1-3 read first time and referred to Committee on Education;
1-4 April 17, 2001, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 7, Nays 0; April 17, 2001,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 914 By: Nelson
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to certain educational facilities and housing facilities
1-11 owned by higher education authorities or by certain nonprofit
1-12 entities.
1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14 SECTION 1. Section 53.46, Education Code, is amended to read
1-15 as follows:
1-16 Sec. 53.46. EXEMPTION [AUTHORITY EXEMPT] FROM TAXATION.
1-17 (a) An educational facility or housing facility is exempt from
1-18 taxation if the facility qualifies for an exemption under
1-19 Subsection (b) or (c).
1-20 (b) An educational facility or housing facility is exempt
1-21 from taxation if the facility is owned by an authority, by a
1-22 corporation created under Section 53.35(b), or by a nonprofit
1-23 foundation created on behalf of an institution of higher education,
1-24 an accredited primary or secondary school, or an authorized charter
1-25 school, if the facility is financed in whole or in part under this
1-26 chapter, and if the facility:
1-27 (1) is held for the exclusive benefit of an
1-28 institution of higher education, an accredited primary or secondary
1-29 school, or an authorized charter school that has, by official
1-30 action under this section, approved that ownership and financing;
1-31 (2) is held for the exclusive use of the students,
1-32 faculty, and staff members of the benefited institution or school;
1-33 and
1-34 (3) would be exempt from taxation under other
1-35 applicable law if the facility were owned by the institution or
1-36 school.
1-37 (c) An educational facility or housing facility owned or
1-38 leased by an institution of higher education, by an accredited
1-39 primary or secondary school, or by an authorized charter school
1-40 that is financed in whole or in part under this chapter is exempt
1-41 from taxation if it is exempt from taxation under other applicable
1-42 law.
1-43 (d) A housing facility is exempt from taxation by a taxing
1-44 unit as defined by Section 1.04, Tax Code, if:
1-45 (1) the facility is owned by an authority created by a
1-46 municipality, or by a corporation created under Section 53.35(b) by
1-47 a municipality, or created on behalf of an institution of higher
1-48 education, an accredited primary or secondary school, or an
1-49 authorized charter school and if the facility is financed or
1-50 acquired in whole or in part under this chapter; and
1-51 (2) all net revenues derived from the facility are
1-52 devoted exclusively to the granting of scholarships in the form of
1-53 reduced room and board charges or in other lawful forms.
1-54 (e) Subsection (d) shall not apply to any authority or
1-55 nonprofit corporation created or to be created under this chapter
1-56 by a city if an authority or nonprofit corporation created by the
1-57 same city had granted room and board scholarships prior to
1-58 September 1, 2001, to students residing in facilities owned by the
1-59 authority or nonprofit corporation.
1-60 (f) If a housing facility exempt under Subsection (d)(2)
1-61 fails to award scholarships having a value at least equal to the
1-62 amount of ad valorem taxes that would have been owed if the
1-63 facility had not been exempt, the facility shall make a payment in
1-64 the amount of the taxes that would be due, if taxes would have been
2-1 owed, for the proportional benefit of the applicable taxing
2-2 jurisdictions in the amount of the difference between the value of
2-3 the scholarships and the taxes which otherwise would have been
2-4 payable. For purposes of determining the value of scholarships
2-5 described in this subsection, a scholarship shall be valued at the
2-6 same amount that is charged to a non-scholarship-recipient residing
2-7 at the same facility who receives substantially the same benefits
2-8 as the scholarship recipient. This provision may not alter an
2-9 existing agreement in existence prior to September 1, 2001, without
2-10 permission of the affected taxing authority. The local taxing unit
2-11 shall determine the amount of the difference between the value of
2-12 the scholarships and the taxes that would have been payable.
2-13 [Because the property owned by authority will be held for
2-14 educational purposes only and will be devoted exclusively to the
2-15 use and benefit of the students, faculty, and staff members of an
2-16 accredited institution of higher education, it is exempt from
2-17 taxation of every character.]
2-18 SECTION 2. Subchapter C, Chapter 53, Education Code, is
2-19 amended by adding Section 53.461 to read as follows:
2-20 Sec. 53.461. TAX REBATE. (a) A housing facility is
2-21 eligible for a rebate of the ad valorem property taxes paid to a
2-22 taxing unit as defined by Section 1.04, Tax Code, if:
2-23 (1) the facility is owned by an authority, by a
2-24 corporation created under Section 53.35(b), or by a nonprofit
2-25 foundation created on behalf of an institution of higher education,
2-26 an accredited primary or secondary school, or an authorized charter
2-27 school;
2-28 (2) the facility is financed in whole or in part under
2-29 this chapter; and
2-30 (3) all net revenues derived from the facility are
2-31 devoted exclusively to the granting of scholarships in the form of
2-32 reduced room and board charges or in other lawful forms.
2-33 (b) The governing body of the taxing unit shall determine the
2-34 amount of the rebate except that the amount of the rebate in any
2-35 year may not exceed the lesser of:
2-36 (1) the amount of ad valorem taxes paid to the taxing
2-37 unit in that year; or
2-38 (2) the fair market value of scholarships awarded
2-39 under Subsection (a)(3) in the preceding year.
2-40 SECTION 3. This Act takes effect immediately if it receives
2-41 a vote of two-thirds of all the members elected to each house, as
2-42 provided by Section 39, Article III, Texas Constitution. If this
2-43 Act does not receive the vote necessary for immediate effect, this
2-44 Act takes effect September 1, 2001.
2-45 * * * * *