78S40087 ESH/JD/YDB/CBH-D

By:  Grusendorf                                                 H.J.R. No. 2  



A JOINT RESOLUTION

proposing a constitutional amendment creating the education 
excellence fund, authorizing a state ad valorem tax for public 
education, authorizing state video lottery games that may be 
operated by licensed racetrack operators or recognized Indian 
tribes, and authorizing the legislature to limit the maximum 
average increase in the appraised value of residence homesteads for 
ad valorem tax purposes to three percent or more.
	BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:                       
	SECTION 1.  Section 47, Article III, Texas Constitution, is 
amended by amending Subsection (a) and adding Subsections (f) and 
(g) to read as follows:
	(a)  The Legislature shall pass laws prohibiting lotteries 
and gift enterprises in this State other than those authorized by 
Subsections (b), (d), [and] (e), and (f) of this section.
	(f)  The Legislature by general law may authorize the State 
to operate video lottery games and to contract with one or more of 
the following legal entities to operate video lottery games on 
behalf of the State:
		(1)  a person licensed in this State to conduct 
wagering on a horse race or greyhound race; or
		(2)  an Indian tribe recognized by the United States 
government under federal law.
	(g)  For purposes of Subsection (f) of this section, "video 
lottery game" means any game of chance, including a game of chance 
in which the outcome may be partially determined by skill or 
ability, that for consideration may be played by an individual on an 
electronic machine or video display, regardless of whether the game 
is authorized as a lottery under Subsection (e) of this section.
	SECTION 2.  Article VII, Texas Constitution, is amended by 
adding Section 5A to read as follows:
	Sec. 5A.  (a)  The education excellence fund consists of:               
		(1)  all proceeds of any state ad valorem tax imposed as 
authorized by Section 1-e, Article VIII, of this constitution;
		(2)  the net revenue, as determined by general law, of 
any state video lottery games operated under Section 47(f), Article 
III, of this constitution; and
		(3)  other funds transferred or dedicated to the fund 
by general law.
	(b)  The education excellence fund may be appropriated only 
for purposes of educational improvement. At least 80 percent of the 
money appropriated from the fund must be used to pay incentives and 
rewards to school teachers and principals for educational 
improvement.
	SECTION 3.  Section 1(i), Article VIII, Texas Constitution, 
is amended to read as follows:
	(i)  Notwithstanding Subsections (a) and (b) of this 
section, the Legislature by general law may limit the maximum 
average annual percentage increase in the appraised value of 
residence homesteads for ad valorem tax purposes to three [10] 
percent, or a greater percentage, for each year since the most 
recent tax appraisal.  A limitation on appraisal increases 
authorized by this subsection:
		(1)  takes effect as to a residence homestead on the 
later of the effective date of the law imposing the limitation or 
January 1 of the tax year following the first tax year the owner 
qualifies the property for an exemption under Section 1-b of this 
article; and
		(2)  expires on January 1 of the first tax year that 
neither the owner of the property when the limitation took effect 
nor the owner's spouse or surviving spouse qualifies for an 
exemption under Section 1-b of this article.
	SECTION 4.  Section 1-e, Article VIII, Texas Constitution, 
is amended to read as follows:
	Sec. 1-e.  (a)  Except as provided by Subsection (b) of this 
section, no [No] State ad valorem taxes shall be levied upon any 
property within this State.
	(b)  The legislature by general law may impose a State ad 
valorem tax on all taxable property for elementary and secondary 
public free school purposes.
	SECTION 5.  This proposed constitutional amendment shall be 
submitted to the voters at an election to be held November 2, 2004.  
The ballot shall be printed to permit voting for or against the 
proposition:  "The constitutional amendment creating the education 
excellence fund, authorizing a state ad valorem tax for public 
education, authorizing state video lottery games that may be 
operated by licensed racetrack operators or recognized Indian 
tribes, and authorizing the legislature to limit the maximum 
average increase in the appraised value of residence homesteads for 
ad valorem tax purposes to three percent or more."