79S20017 JD-D



By:  Janek                                                        S.B. No. 13 







A BILL TO BE ENTITLED



AN ACT



relating to authorizing the governing body of a taxing unit to 

establish for purposes of ad valorem taxation by the taxing unit a 

lower limit on increases in the appraised value of residence 

homesteads in the taxing unit.

	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        

	SECTION 1.  Section 23.23, Tax Code, is amended by amending 

Subsection (a) and adding Subsections (g) and (h) to read as 

follows:

	(a)  Except as provided under Subsection (g), the [The] 

appraised value of a residence homestead for a tax year may not 

exceed the lesser of:

		(1)  the market value of the property; or                                     

		(2)  the sum of:                                                              

			(A)  10 percent of the appraised value of the 

property for the last year in which the property was appraised for 

taxation times the number of years since the property was last 

appraised;

			(B)  the appraised value of the property for the 

last year in which the property was appraised; and

			(C)  the market value of all new improvements to 

the property.             

	(g)  The governing body of a taxing unit, in the manner 

required by law for official action, may at any time provide that 

for purposes of taxation by the taxing unit in the following and 

each subsequent tax year a lower limitation on appraised value 

determined in the manner provided by Subsection (a)(2) using a 

percentage of less than 10 percent but not less than three percent 

in place of 10 percent in Subsection (a)(2)(A) will apply to the 

taxation of residence homesteads by the taxing unit.

	(h)  Subsection (g) does not affect the appraised value of a 

residence homestead for taxation by a taxing unit other than the 

taxing unit whose governing body provides for the application of a 

limitation on appraised value under that subsection.  If the 

governing body of the taxing unit sets the tax rate for more than 

one taxing unit, an action by the governing body under Subsection 

(g) does not apply to a taxing unit other than the taxing unit whose 

governing body takes that action.

	SECTION 2.  Section 42.26(d), Tax Code, is amended to read as 

follows:       

	(d)  For purposes of this section, the value of the property 

subject to the suit and the value of a comparable property or sample 

property that is used for comparison must be the market value 

determined by the appraisal district when the property is a 

residence homestead subject to the limitation on appraised value 

imposed by or authorized under Section 23.23.

	SECTION 3.  This Act takes effect January 1, 2006, and 

applies only to the appraisal of a residence homestead for ad 

valorem tax purposes for a tax year that begins on or after January 

1, 2006, but only if the constitutional amendment proposed by the 

79th Legislature, 2nd Called Session, 2005, authorizing the 

legislature to authorize the governing body of a political 

subdivision to establish for purposes of ad valorem taxation by the 

political subdivision a lower limit on the maximum average annual 

percentage increase in the appraised value of residence homesteads 

in the political subdivision is approved by the voters.  If that 

amendment is not approved by the voters, this Act has no effect.