SRC-EPT H.B. 1125 78(R)   BILL ANALYSIS


Senate Research Center   H.B. 1125
78 R 2777 JD-FBy: Flores (Staples)
Finance
5/20/2003
Engrossed


DIGEST AND PURPOSE 

Under current law, the redemption period concerning mineral tax rolls
gives the foreclosed owner only six months to reclaim lost property.
Mineral tax rolls, as opposed to real property rolls, are not prepared by
the appraisal districts from the official records of the county where the
property is located.  The records used for preparation of the rolls come
from private industry and may be incomplete and contain inaccurate data.
In many cases the foreclosed owner is never informed of the taxes owed or
the repossession of mineral royalties.  If a foreclosed owner does not
receive notification of the sale, the foreclosed owner is entirely
dependent upon the actions of others.  The current time allotment of six
months may not provide the royalty owner enough time to settle claims in
court, resulting in the owner not having any right of redemption after
receiving notice of the foreclosure.   
 
H.B. 1125 gives royalty owners some protection from ad valorem tax
foreclosure by extending the redemption period to two years from the date
on which the deed of the taxing unit is filed for record.    


RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
a state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Sections 34.21(a), (b), (c), and (e), Tax Code, as
follows: 
 
(a)  Provides that the owner of real property sold at a tax sale to a
purchaser other than a taxing unit that was used as the residence
homestead of the owner or that was land designated for agricultural use
when the suit or the application for the warrant was filed, or the owner
of a mineral interest sold at a tax sale to a purchaser other than a
taxing unit, may redeem the property on or before the second anniversary
of the date on which the purchaser's deed is filed for record by paying
the purchaser the amount the purchaser bid for the property, the amount of
the deed recording fee, and the amount paid by the purchaser as taxes,
penalties, interest, and costs on the property, plus a redemption premium
of 25 percent of the aggregate total if the property is redeemed during
the first year of the redemption period or 50 percent of the aggregate
total if the property is redeemed during the second year of the redemption
period. 
 
(b)  Provides that if property that was used as the owner's residence
homestead or was land designated for agricultural use when the suit or the
application for the warrant was filed, or that is a mineral interest, is
bid off to a taxing unit under Section 34.01(j) or (p) and has not been
resold by the taxing unit, the owner having a right of redemption may
redeem the property on or before the second anniversary of the date on
which the deed of the taxing unit is filed for record by paying the taxing
unit the lesser of certain amounts. 
  
 (c) Makes a conforming change.

 (e)  Makes a conforming change.
 
SECTION 2.  (a)  Effective date:  January 1, 2004, but only if the
constitutional amendment proposed by the 78th Legislature, Regular
Session, 2003, to establish a two-year period for the redemption of a
mineral interest sold for unpaid ad valorem taxes at a tax sale is
approved by the voters.  Provides that if that amendment is not approved
by the voters, this Act has no effect. 
 
(b)  Makes application of this Act prospective.