H.B. 195 78(R)    BILL ANALYSIS


H.B. 195
By: Griggs
Public Education
Committee Report (Unamended)



BACKGROUND

County Education Districts (CEDs) were created in 1991 to levy
state-mandated property taxes and redistribute the revenues to their
member districts on an equalized basis. However, a 1992 Texas Supreme
Court decision rendered the CED concept unconstitutional. Since taxes
already had been collected for two years under the CED structure, and with
delinquent taxes outstanding, it was necessary to continue to collect
taxes until the obligations were satisfied. Although legislation allowing
districts to voluntarily dissolve  CEDs has been passed, some school
districts are still reluctant to enter into a dissolution agreement due to
outstanding delinquent taxes owed to the CED. Often the amount of
delinquent taxes owed to any school district is very small when compared
to the original levy, and the cost of maintaining these accounts and
performing annual audits sometimes exceeds the revenue that could be
realized from the delinquent taxes.  
 

PURPOSE 

House Bill 195 dissolves the existing County Education Districts and
return to each district their respective CED delinquent tax roll. 
 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 


ANALYSIS

House Bill 195 amends the Tax Code to require a successor-in-interest to a
county education district to return all money, held by a
successor-in-interest that represents delinquent taxes collected for a
county education district, to the component school districts of the county
education district  no later than September 15, 2003. The bill sets forth
provisions concerning the amount transferred to each school district. The
bill requires all delinquent tax liabilities still owed to the county
education district  to be returned to the  respective component school
districts of the county education district by September 15, 2003. 


EFFECTIVE DATE

September 1, 2003