2005S1384-1 06/21/05
By: Williams S.B. No. 4
A BILL TO BE ENTITLED
AN ACT
relating to the calculation and imposition of an ad valorem tax by a
taxing unit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subsection (c), Section 26.04, Tax Code, is
amended to read as follows:
(c) An officer or employee designated by the governing body
shall calculate the effective tax rate and the rollback tax rate for
the unit, where:
(1) "Effective tax rate" means a rate expressed in
dollars per $100 of taxable value calculated according to the
following formula:
EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY LEVY) /
(CURRENT TOTAL VALUE - NEW PROPERTY VALUE)
; and
(2) "Rollback tax rate" means a rate expressed in
dollars per $100 of taxable value calculated according to the
following formula:
ROLLBACK TAX RATE = (EFFECTIVE MAINTENANCE AND OPERATIONS RATE x
1.05 [1.08]) + CURRENT DEBT RATE
SECTION 2. Subsections (a), (b), and (c), Section 26.041,
Tax Code, are amended to read as follows:
(a) In the first year in which an additional sales and use
tax is required to be collected, the effective tax rate and rollback
tax rate for the unit are calculated according to the following
formulas:
EFFECTIVE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY LEVY) /
(CURRENT TOTAL VALUE - NEW PROPERTY VALUE) - SALES TAX GAIN RATE
and
ROLLBACK RATE = (EFFECTIVE MAINTENANCE AND OPERATIONS RATE x 1.05
[1.08]) + CURRENT DEBT RATE - SALES TAX GAIN RATE
where "sales tax gain rate" means a number expressed in dollars per
$100 of taxable value, calculated by dividing the revenue that will
be generated by the additional sales and use tax in the following
year as calculated under Subsection (d) [of this section] by the
current total value.
(b) Except as provided by Subsections (a) and (c) [of this
section], in a year in which a taxing unit imposes an additional
sales and use tax the rollback tax rate for the unit is calculated
according to the following formula, regardless of whether the unit
levied a property tax in the preceding year:
ROLLBACK RATE = [(LAST YEAR'S MAINTENANCE AND OPERATIONS EXPENSE X
1.05 [1.08]) / ([TOTAL] CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] +
(CURRENT DEBT RATE - SALES TAX REVENUE RATE)
where "last year's maintenance and operations expense" means the
amount spent for maintenance and operations from property tax and
additional sales and use tax revenues in the preceding year, and
"sales tax revenue rate" means a number expressed in dollars per
$100 of taxable value, calculated by dividing the revenue that will
be generated by the additional sales and use tax in the current year
as calculated under Subsection (d) [of this section] by the current
total value.
(c) In a year in which a taxing unit that has been imposing
an additional sales and use tax ceases to impose an additional sales
and use tax the effective tax rate and rollback tax rate for the
unit are calculated according to the following formulas:
EFFECTIVE TAX RATE = [(LAST YEAR'S LEVY - LOST PROPERTY LEVY) /
[(CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] + SALES TAX LOSS RATE
and
ROLLBACK TAX RATE = [(LAST YEAR'S MAINTENANCE AND OPERATIONS
EXPENSE X 1.05 [1.08]) / ([TOTAL] CURRENT TOTAL VALUE - NEW PROPERTY
VALUE)] + CURRENT DEBT RATE
where "sales tax loss rate" means a number expressed in dollars per
$100 of taxable value, calculated by dividing the amount of sales
and use tax revenue generated in the last four quarters for which
the information is available by the current total value and "last
year's maintenance and operations expense" means the amount spent
for maintenance and operations from property tax and additional
sales and use tax revenues in the preceding year.
SECTION 3. Subsection (b), Section 26.07, Tax Code, is
amended to read as follows:
(b) A petition is valid only if:
(1) it states that it is intended to require an
election in the taxing unit on the question of reducing the tax rate
for the current year;
(2) it is signed by a number of registered voters of
the taxing unit equal to at least:
(A) seven percent of the number of [registered]
voters of the taxing unit who voted in [according to] the most
recent gubernatorial election [list of registered voters] if the
tax rate adopted for the current tax year would impose taxes for
maintenance and operations in an amount of at least $5 million; or
(B) 10 percent of the number of [registered]
voters of the taxing unit who voted in [according to] the most
recent gubernatorial election [official list of registered voters]
if the tax rate adopted for the current tax year would impose taxes
for maintenance and operations in an amount of less than $5 million;
and
(3) it is submitted to the governing body on or before
the 90th day after the date on which the governing body adopted the
tax rate for the current year.
SECTION 4. (a) The change in law made by this Act applies
to the ad valorem tax rate of a taxing unit beginning with the 2005
tax year, except as provided by Subsection (b) of this section.
(b) If the governing body of a taxing unit adopted an ad
valorem tax rate for the taxing unit for the 2005 tax year before
the effective date of this Act, the change in law made by this Act
applies to the ad valorem tax rate of that taxing unit beginning
with the 2006 tax year, and the law in effect when the tax rate was
adopted applies to the 2005 tax year with respect to that taxing
unit.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect on the 91st day after the last day of the
legislative session.