78R2444 SMH-D
By: Gutierrez H.B. No. 701
A BILL TO BE ENTITLED
AN ACT
relating to a prohibition on increasing the total amount of ad
valorem taxes imposed by a taxing unit other than a hospital
district on the residence homestead of a disabled person, an
elderly person, or an elderly person's surviving spouse.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 11.26, Tax Code, is amended to read as
follows:
Sec. 11.26. LIMITATION OF TAXES [SCHOOL TAX] ON HOMESTEADS
OF DISABLED OR ELDERLY. (a) The limitation on tax increases
imposed by this section does not apply to taxes imposed by a
hospital district.
(b) The tax officials shall appraise the property to which
this section applies and calculate taxes as on other property, but
if the tax [so] calculated exceeds the limitation imposed by this
section, the tax imposed is the amount of the tax as limited by this
section, except as otherwise provided by this section. If an
individual qualifies a residence homestead for an exemption
provided by Section 11.13(c) or (d) for an individual who is
disabled or is 65 years of age or older, a taxing unit [A school
district] may not increase the total annual amount of ad valorem tax
it imposes on the residence homestead in any tax year following the
first tax year in which the individual qualified the residence
homestead for the exemption [of an individual 65 years or older]
above the amount of the tax it imposed in the preceding [first] tax
year [in which the individual qualified that residence homestead
for the exemption provided by Section 11.13(c) for an individual 65
years of age or older. If the individual qualified that residence
homestead for the exemption after the beginning of that first year
and the residence homestead remains eligible for the exemption for
the next year, and if the school district taxes imposed on the
residence homestead in the next year are less than the amount of
taxes imposed in that first year, a school district may not
subsequently increase the total annual amount of ad valorem taxes
it imposes on the residence homestead above the amount it imposed in
the year immediately following the first year for which the
individual qualified that residence homestead for the exemption],
except as provided by Subsection (c) [(b). If the first tax year
the individual qualified the residence homestead for the exemption
provided by Section 11.13(c) was a tax year before the 1997 tax
year, the amount of the limitation provided by this section is the
amount of tax the school district imposed for the 1996 tax year less
an amount equal to the amount determined by multiplying $10,000
times the tax rate of the school district for the 1997 tax year,
plus any 1997 tax attributable to improvements made in 1996, other
than improvements made to comply with governmental regulations or
repairs].
(c) [(b)] If an individual makes improvements to the
individual's residence homestead, other than improvements required
to comply with governmental requirements or repairs, a taxing unit
[the school district] may increase the tax on the homestead in the
first year the value of the homestead is increased on the appraisal
roll because of the enhancement of value by the improvements. The
amount of the tax increase is determined by applying the current tax
rate to the difference in the assessed value of the homestead with
the improvements and the assessed value it would have had without
the improvements. A limitation under [imposed by] this section
[then] applies to the increased amount of tax in subsequent tax
years until more improvements, if any, are made.
(d) [(c)] The limitation on tax increases required by this
section expires if on January 1:
(1) none of the owners of the structure who qualify for
the exemption and who owned the structure when the limitation first
took effect is using the structure as a residence homestead; or
(2) none of the owners of the structure qualifies for
an [the] exemption provided by Section 11.13(c) or (d) for an
individual who is disabled or is 65 years of age or older.
(e) [(d)] If the appraisal roll provides for taxation of
appraised value for a prior year because a residence homestead
exemption for persons who are disabled or are 65 years of age or
older was erroneously allowed, the tax assessor shall add, as back
taxes due as provided by [Subsection (d) of] Section 26.09(d)
[26.09 of this code], the positive difference if any between the tax
that should have been imposed for that year and the tax that was
imposed because of the provisions of this section.
(f) [(e)] For each school district participating in an
appraisal district, the chief appraiser shall determine the portion
of the appraised value of residence homesteads [of the elderly] on
which school district taxes are not imposed in a tax year because of
the limitation on tax increases imposed by this section. That
portion is calculated by determining the taxable value that, if
multiplied by the tax rate adopted by each [the] school district for
the tax year, would produce an amount equal to the amount of tax
that would have been imposed by the school district on those
residence homesteads [of the elderly] if the limitation on tax
increases imposed by this section were not in effect, but that was
not imposed because of that limitation. The chief appraiser shall
determine that taxable value and certify it to the comptroller as
soon as practicable for each tax year.
(g) [(f)] The limitation on tax increases required by this
section does not expire because the owner of an interest in the
structure conveys the interest to a qualifying trust as defined by
Section 11.13(j) if the owner or the owner's spouse is a trustor of
the trust and is entitled to occupy the structure.
(h) [(g)] Except as provided by Subsection (c) [(b)], if an
individual who receives a limitation on tax increases imposed by
this section, including a surviving spouse who receives a
limitation under Subsection (j) [(i)], subsequently qualifies a
different residence homestead for an exemption under Section 11.13,
a taxing unit [school district] may not impose ad valorem taxes on
the subsequently qualified homestead in a year in an amount that
exceeds the amount of taxes the taxing unit [school district] would
have imposed on the subsequently qualified homestead in the first
year in which the individual receives the [that] exemption for the
subsequently qualified homestead had the limitation on tax
increases imposed by this section not been in effect, multiplied by
a fraction the numerator of which is the total amount of [school
district] taxes imposed by a taxing unit of the same type on the
former homestead in the last year in which the individual received
the [that] exemption for the former homestead and the denominator
of which is the total amount of [school district] taxes that would
have been imposed by the taxing unit of the same type on the former
homestead in the last year in which the individual received the
[that] exemption for the former homestead had the limitation on tax
increases imposed by this section not been in effect. Except as
provided by Subsection (c), if in any year following the year in
which the individual qualifies the subsequent homestead for an
exemption under Section 11.13 the amount of taxes imposed by a
taxing unit on the homestead is less than the amount of taxes
imposed by that taxing unit in the preceding year, the taxing unit
may not increase the taxes it imposes on the homestead above that
amount in any subsequent year. The limitation imposed by this
subsection does not apply to a taxing unit if the former homestead
was not subject to taxation by a taxing unit of the same type in the
last year in which the individual received the exemption for the
former homestead. For purposes of this subsection, a taxing unit is
of the same type as another taxing unit if the taxing units:
(1) are both municipalities, both counties, both
school districts, or both junior college districts; or
(2) are taxing units not described by Subdivision (1)
and one taxing unit provides one or more of the same types of
services as the other.
(i) [(h)] An individual who receives a limitation on tax
increases under this section, including a surviving spouse who
receives a limitation under Subsection (j) [(i)], and who
subsequently qualifies a different residence homestead for an
exemption under Section 11.13, or an agent of the individual, is
entitled to receive from the chief appraiser of the appraisal
district in which the former homestead was located a written
certificate providing the information necessary to determine
whether the individual may qualify for a limitation on the
subsequently qualified homestead under Subsection (h) [(g)] and to
calculate the amount of taxes the taxing units [school district]
may impose on the subsequently qualified homestead.
(j) [(i)] If an individual who qualifies for the exemption
provided by Section 11.13(c) or (d) for an individual 65 years of
age or older dies, the surviving spouse of the individual is
entitled to the limitation applicable to the residence homestead of
the individual if:
(1) the surviving spouse is 55 years of age or older
when the individual dies; and
(2) the residence homestead of the individual:
(A) is the residence homestead of the surviving
spouse on the date that the individual dies; and
(B) remains the residence homestead of the
surviving spouse.
(k) [(j)] If an individual who qualifies for an exemption
provided by Section 11.13(c) or (d) for an individual 65 years of
age or older dies in the first year in which the individual
qualified for the exemption and the individual first qualified for
the exemption after the beginning of that year, except as provided
by Subsection (l) [(k)], the amount to which the surviving spouse's
[school district] taxes imposed by a taxing unit are limited under
Subsection (j) [(i)] is the amount of [school district] taxes
imposed by the taxing unit on the residence homestead in that year
determined as if the individual qualifying for the exemption had
lived for the entire year.
(l) [(k)] If in a [the first] tax year after the year in which
an individual dies in the circumstances described by Subsection (k)
[(j)] the amount of [school district] taxes imposed by a taxing unit
on the residence homestead of the surviving spouse is less than the
amount of [school district] taxes imposed by the taxing unit [in the
preceding year] as limited by Subsection (k) [(j)], in a subsequent
tax year the [surviving spouse's school district] taxes imposed by
that taxing unit on that residence homestead are limited to the
lesser amount of taxes imposed by the taxing unit [district] in that
[first] tax year [after the year in which the individual dies].
(m) For the purpose of calculating a limitation on tax
increases by a school district under this section, an individual
who qualified a residence homestead before January 1, 2003, for an
exemption under Section 11.13(c) or (d) for an individual who is
disabled is considered to have qualified the homestead for that
exemption on January 1, 2003.
(n) For the purpose of calculating a limitation on tax
increases by a taxing unit other than a school district under this
section, an individual who qualified a residence homestead before
January 1, 2003, for an exemption under Section 11.13(c) or (d) for
an individual who is disabled or is 65 years of age or older is
considered to have qualified the homestead for that exemption on
January 1, 2003.
(o) For the purpose of qualifying under Subsection (h) for
the limitation on taxes on a subsequently qualified homestead
imposed by a school district, the residence homestead of an
individual who qualified the former homestead for an exemption
under Section 11.13(c) or (d) for an individual who is disabled may
be considered to be a subsequently qualified homestead only if the
individual qualified the former homestead for that exemption for a
tax year beginning on or after January 1, 2003.
(p) For the purpose of qualifying under Subsection (h) for
the limitation on taxes on a subsequently qualified homestead
imposed by a taxing unit other than a school district, the residence
homestead of an individual may be considered to be a subsequently
qualified homestead only if the individual qualified the former
homestead for an exemption under Section 11.13(c) or (d) for an
individual who is disabled or is 65 years of age or older for a tax
year beginning on or after January 1, 2003.
(q) The limitations on tax increases provided by this
section apply to taxes imposed on a residence homestead by a school
district whose boundaries are changed to include the residence
homestead as if the taxes imposed on the residence homestead by the
school district in which the residence homestead was previously
located had been imposed by the school district whose boundaries
include the residence homestead after the boundary change.
[(l) For purposes of the limitation on tax increases provided
by Subsection (g), the governing body of a school district in a
county with a population of fewer than 75,000 in a manner provided
by law for official action by the governing body may elect to apply
the limitation provided by Subsection (g) to the residence
homestead of an individual as if that subsection were in effect on
January 1, 1993. The governing body must make the election before
January 1, 1999. The election applies only to taxes imposed in a
tax year that begins after the tax year in which the election is
made.]
SECTION 2. Section 23.19(g), Tax Code, is amended to read as
follows:
(g) A tax bill or a separate statement accompanying the tax
bill to a cooperative housing corporation for which interests of
stockholders are separately appraised under this section must
state, in addition to the information required by Section 31.01 [of
this code], the appraised value and taxable value of each interest
separately appraised. Each exemption claimed as provided by this
title by a person entitled to the exemption shall also be deducted
from the total appraised value of the property of the corporation.
The total tax imposed by a taxing unit [school district] shall be
reduced by any amount that represents an increase in taxes
attributable to separately appraised interests of the real property
and improvements that are subject to a [the] limitation of taxes
prescribed by Section 11.26 [of this code]. The corporation shall
apportion among its stockholders liability for reimbursing the
corporation for property taxes according to the relative taxable
values of their interests.
SECTION 3. Sections 26.012(6), (13), and (14), Tax Code,
are amended to read as follows:
(6) "Current total value" means the total taxable
value of property listed on the appraisal roll for the current year,
including all appraisal roll supplements and corrections as of the
date of the calculation, less the taxable value of property
exempted for the current tax year for the first time under Section
11.31, except that:
(A) the current total value for a taxing unit
other than a hospital [school] district excludes[:
[(A)] the total value of homesteads that qualify
for a tax limitation as provided by Section 11.26; and
(B) the current total value for a school district
also excludes new property value of property that is subject to an
agreement entered into under Chapter 313.
(13) "Last year's levy" means the total of:
(A) the amount of taxes that would be generated
by multiplying the total tax rate adopted by the governing body in
the preceding year by the total taxable value of property on the
appraisal roll for the preceding year, including:
(i) taxable value that was reduced in an
appeal under Chapter 42; and
(ii) all appraisal roll supplements and
corrections other than corrections made pursuant to Section
25.25(d), as of the date of the calculation but excluding[, except
that last year's taxable value for a school district excludes] the
total value of homesteads that qualified for a tax limitation as
provided by Section 11.26; and
(B) the amount of taxes refunded by the taxing
unit in the preceding year for tax years before that year.
(14) "Last year's total value" means the total taxable
value of property listed on the appraisal roll for the preceding
year, including all appraisal roll supplements and corrections,
other than corrections made pursuant to Section 25.25(d) [of this
code], as of the date of the calculation but excluding[, except that
last year's taxable value for a school district excludes] the total
value of homesteads that qualified for a tax limitation as provided
by Section 11.26 [of this code].
SECTION 4. Section 403.302(d), Government Code, is amended
to read as follows:
(d) For the purposes of this section, "taxable value" means
the market value of all taxable property less:
(1) the total dollar amount of any residence homestead
exemptions lawfully granted under Section 11.13(b) or (c), Tax
Code, in the year that is the subject of the study for each school
district;
(2) one-half of the total dollar amount of any
residence homestead exemptions granted under Section 11.13(n), Tax
Code, in the year that is the subject of the study for each school
district;
(3) the total dollar amount of any exemptions granted
before May 31, 1993, within a reinvestment zone under agreements
authorized by Chapter 312, Tax Code;
(4) subject to Subsection (e), the total dollar amount
of any captured appraised value of property that:
(A) is within a reinvestment zone created on or
before May 31, 1999, or is proposed to be included within the
boundaries of a reinvestment zone as the boundaries of the zone and
the proposed portion of tax increment paid into the tax increment
fund by a school district are described in a written notification
provided by the municipality or the board of directors of the zone
to the governing bodies of the other taxing units in the manner
provided by Section 311.003(e), Tax Code, before May 31, 1999, and
within the boundaries of the zone as those boundaries existed on
September 1, 1999, including subsequent improvements to the
property regardless of when made;
(B) generates taxes paid into a tax increment
fund created under Chapter 311, Tax Code, under a reinvestment zone
financing plan approved under Section 311.011(d), Tax Code, on or
before September 1, 1999; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(5) the total dollar amount of any exemptions granted
under Section 11.251, Tax Code;
(6) the difference between the comptroller's estimate
of the market value and the productivity value of land that
qualifies for appraisal on the basis of its productive capacity,
except that the productivity value estimated by the comptroller may
not exceed the fair market value of the land;
(7) the portion of the appraised value of residence
homesteads of the disabled or elderly on which school district
taxes are not imposed in the year that is the subject of the study,
calculated as if the residence homesteads were appraised at the
full value required by law;
(8) a portion of the market value of property not
otherwise fully taxable by the district at market value because of:
(A) action required by statute or the
constitution of this state that, if the tax rate adopted by the
district is applied to it, produces an amount equal to the
difference between the tax that the district would have imposed on
the property if the property were fully taxable at market value and
the tax that the district is actually authorized to impose on the
property, if this subsection does not otherwise require that
portion to be deducted; or
(B) action taken by the district under Subchapter
B or C, Chapter 313, Tax Code;
(9) the market value of all tangible personal
property, other than manufactured homes, owned by a family or
individual and not held or used for the production of income;
(10) the appraised value of property the collection of
delinquent taxes on which is deferred under Section 33.06, Tax
Code;
(11) the portion of the appraised value of property
the collection of delinquent taxes on which is deferred under
Section 33.065, Tax Code; and
(12) the amount by which the market value of a
residence homestead to which Section 23.23, Tax Code, applies
exceeds the appraised value of that property as calculated under
that section.
SECTION 5. (a) The limitations provided by Section 11.26,
Tax Code, as amended by this Act, on ad valorem tax increases by
school districts on residence homesteads that were not covered by
Section 11.26, Tax Code, before the amendment of that section by
this Act apply beginning with ad valorem taxes imposed for the 2004
tax year.
(b) The limitations provided by Section 11.26, Tax Code, as
amended by this Act, on tax increases on residence homesteads by
taxing units that were not covered by Section 11.26, Tax Code,
before the amendment of that section by this Act apply beginning
with taxes imposed for the 2004 tax year.
SECTION 6. This Act takes effect January 1, 2004, but only
if the constitutional amendment proposed by the 78th Legislature,
Regular Session, 2003, to prohibit a political subdivision other
than a hospital district from increasing ad valorem taxes on the
residence homestead of a disabled person, an elderly person, or the
surviving spouse of an elderly person is approved by the voters. If
that amendment is not approved by the voters, this Act has no
effect.