H.B. 1980 78(R)    BILL ANALYSIS


H.B. 1980
By: Puente
Local Government Ways and Means
Committee Report (Unamended)



BACKGROUND AND PURPOSE 

Currently, if the use of appraised land changes in value, an additional
tax is imposed.  The tax is equal to the difference between the taxes
imposed on the land for each of the five years preceding the year in which
the change of use occurs on the appraised land and the tax that would have
been imposed had the land been taxed on the basis of market value in each
of those years, plus interest at an annual rate of seven percent
calculated from the dates on which the differences would have become due.

Exemptions exist, however, for transfers of property pursuant to a sale
for a right-of-way, a condemnation, or a transfer to the state or a
political subdivision to be used for a public purpose.   

H.B. 1980 would exempt certain land from the additional tax imposed on a
change of use on land appraised for ad valorem tax purposes as open-space
land, if the property is the subject of transfer from a municipality, if
more than 1,500 new jobs would be created, and the municipality has a
population of more than one million.  

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

H.B. 1980 amends Section 23.55(f) of the Tax Code to provide that
sanctions provided by Subsection (a) of this section, relating to imposing
additional taxes on the change of use of land appraised for ad valorem tax
purposes as open-space land, do not apply if the change of use occurs as a
result of a transfer of the property from a municipality to an individual
or a business entity for the purpose of economic development.  This
applies to municipalities with a population of more than one million and
where the change of use creates more than 1,500 jobs. 

EFFECTIVE DATE

On passage if the Act receives a two-thirds vote of the members of each
House, or if the Act does not receive the necessary votes, the Act takes
effect September 1, 2003.