By: Chisum, Eissler, Branch, H.B. No. 1
Howard of Fort Bend, Hartnett, et al.
A BILL TO BE ENTITLED
AN ACT
relating to public school finance, property tax relief, and related
matters; making an appropriation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. PUBLIC SCHOOL FINANCE AND PROPERTY TAX RELIEF
SECTION 1.01. Section 41.002(a), Education Code, is amended
to read as follows:
(a) A school district may not have a wealth per student that
exceeds $305,000, plus an amount determined under Section
42.2516(i).
SECTION 1.02. Section 42.101, Education Code, is amended to
read as follows:
Sec. 42.101. BASIC ALLOTMENT. For each student in average
daily attendance, not including the time students spend each day in
special education programs in an instructional arrangement other
than mainstream or career and technology education programs, for
which an additional allotment is made under Subchapter C, a
district is entitled to an allotment of $2,537, plus an amount
determined under Section 42.2516(i). A greater amount for any
school year may be provided by appropriation.
SECTION 1.03. Subchapter E, Chapter 42, Education Code, is
amended by adding Sections 42.2516 and 42.261 to read as follows:
Sec. 42.2516. ADDITIONAL STATE AID FOR TAX REDUCTION. (a)
Subject to Subsection (e), but notwithstanding any other provision
of this title, a school district is entitled to the amount of state
revenue necessary to maintain state and local revenue per student
in weighted average daily attendance in the amount equal to the
greater of:
(1) the amount of state and local revenue per student
in weighted average daily attendance for the maintenance and
operations of the district available to the district for the
2005-2006 school year;
(2) the amount of state and local revenue per student
in weighted average daily attendance for the maintenance and
operation of the district to which the district would have been
entitled for the 2006-2007 school year under this chapter, as it
existed on January 1, 2006, or, if the district would have been
subject to Chapter 41, as that chapter existed on January 1, 2006,
the amount to which the district would have been entitled under that
chapter, based on the funding elements in effect for the 2005-2006
school year, if the district imposed a maintenance and operations
tax at the rate adopted by the district for the 2005 tax year; or
(3) the amount of state and local revenue per student
in weighted average daily attendance for the maintenance and
operation of the district to which the district would have been
entitled for the 2006-2007 school year under this chapter, as it
existed on January 1, 2006, or, if the district would have been
subject to Chapter 41, as that chapter existed on January 1, 2006,
the amount to which the district would have been entitled under that
chapter, based on the funding elements in effect for the 2005-2006
school year, if the district imposed a maintenance and operations
tax at the rate equal to the rate described by Section 26.08(i) or
(k)(1), Tax Code, as applicable, for the 2006 tax year.
(b) In determining the amount to which a district is
entitled under Subsection (a), the commissioner shall include:
(1) any amounts described by Rider 69, page III-19,
Chapter 1369, Acts of the 79th Legislature, Regular Session, 2005
(the General Appropriations Act);
(2) for a school district that received additional
revenue for the 2005-2006 school year as a result of an agreement
under Subchapter E, Chapter 41, the amount of that additional
revenue, which is the amount by which the total maintenance and
operations revenue available to the district exceeded the total
maintenance and operations revenue that would have been available
to the district if the district had not entered into the agreement
and had imposed a maintenance and operations tax at the rate of
$1.50 on the $100 valuation of taxable property;
(3) any amount necessary to reflect an adjustment made
by the commissioner under Section 42.005;
(4) any amount necessary to reflect an adjustment made
by the commissioner under Section 42.2521; and
(5) any amount necessary to reflect an adjustment made
by the commissioner under Section 42.2531.
(c) The amount of revenue to which a school district is
entitled because of the technology allotment under Section 32.005
is not included in making a determination under Subsection (a).
(d) For purposes of determining the amount of revenue to
which a school district is entitled under this section, the
commissioner shall use the average tax collection rate for the
district for the 2003, 2004, and 2005 tax years.
(e) If a school district adopts a maintenance and operations
tax rate that is below the rate equal to 88.67 percent of the
maintenance and operations tax rate adopted by the district for the
2005 tax year, the commissioner shall reduce the district's
entitlement under this section in proportion to the amount by which
the adopted rate is less than the rate equal to 88.67 percent of the
rate adopted by the district for the 2005 tax year.
(f) A school district that is required to take action under
Chapter 41 to reduce its wealth per student to the equalized wealth
level and that is entitled to state revenue under this section may
receive that revenue through an adjustment against the total amount
of attendance credits required to be purchased under Subchapter D,
Chapter 41, or the total number of nonresident students required to
be educated under Subchapter E, Chapter 41, as determined by the
commissioner.
(g) If a school district imposes a maintenance and
operations tax at a rate greater than the rate equal to 88.67
percent of the maintenance and operations tax rate adopted by the
district for the 2005 tax year, the commissioner may not reduce the
amount to which the district is entitled under this section on the
basis of the additional revenue collected by the district.
(h) The commissioner may adopt rules necessary to
administer this section.
(i) The commissioner shall determine the amount of state
funds to which a school district is entitled under this section.
The commissioner shall provide these additional amounts by
increasing the guaranteed level under Section 42.302, the basic
allotment under Section 42.101, and the equalized wealth level
under Section 41.002, so that all three formula elements provide
the same yield per penny of tax effort, and continuing to increase
these formula elements proportionately so as to provide school
districts the amounts required under this section as much as
possible through the formula adjustments while minimizing
"hold-harmless" amounts outside of the formulas. The total amount
of state funds under this section shall be limited such that the
changes in state law made by H.B. 1, Acts of the 79th Legislature,
3rd Called Session, shall not exceed $2,385,800,000. The
commissioner's determination is final and may not be appealed.
Sec. 42.261. CERTAIN FUNDS APPROPRIATED FOR PURPOSE OF TAX
REDUCTION. (a) Funds appropriated by the legislature for a tax
year for the purpose of reducing a school district's maintenance
and operations tax rate and providing state aid under Section
42.2516:
(1) are not excess funds for purposes of Section
42.2517;
(2) are not available for purposes of Section 42.2521
or 42.2522;
(3) may not be used for purposes of Chapter 46; and
(4) may not be provided by the commissioner to a school
district for a purpose other than reduction of the district's
maintenance and operations tax rate.
(b) The commissioner may adopt rules necessary to
administer this section.
SECTION 1.04. Section 42.302(a), Education Code, is amended
to read as follows:
(a) Each school district is guaranteed a specified amount
per weighted student in state and local funds for each cent of tax
effort over that required for the district's local fund assignment
up to the maximum level specified in this subchapter. The amount of
state support, subject only to the maximum amount under Section
42.303, is determined by the formula:
GYA = (GL X WADA X DTR X 100) - LR
where:
"GYA" is the guaranteed yield amount of state funds to be
allocated to the district;
"GL" is the dollar amount guaranteed level of state and local
funds per weighted student per cent of tax effort, which is $27.14,
plus an amount determined under Section 42.2516(i), or a greater
amount for any year provided by appropriation;
"WADA" is the number of students in weighted average daily
attendance, which is calculated by dividing the sum of the school
district's allotments under Subchapters B and C, less any allotment
to the district for transportation, any allotment under Section
42.158, and 50 percent of the adjustment under Section 42.102, by
the basic allotment for the applicable year;
"DTR" is the district enrichment tax rate of the school
district, which is determined by subtracting the amounts specified
by Subsection (b) from the total amount of maintenance and
operations taxes collected by the school district for the
applicable school year and dividing the difference by the quotient
of the district's taxable value of property as determined under
Subchapter M, Chapter 403, Government Code, or, if applicable,
under Section 42.2521, divided by 100; and
"LR" is the local revenue, which is determined by multiplying
"DTR" by the quotient of the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, under Section 42.2521, divided by 100.
SECTION 1.05. Section 42.302, Education Code, is amended by
adding Subsection (f) to read as follows:
(f) If a school district imposes a maintenance and
operations tax at a rate greater than the rate equal to 88.67
percent of the maintenance and operations tax rate adopted by the
district for the 2005 tax year, the district is entitled to receive
an allotment under this section on the basis of that greater tax
effort.
SECTION 1.06. Section 21.402(a), Education Code, is amended
to read as follows:
(a) Except as provided by Subsection (d), (e), or (f), a
school district must pay each classroom teacher, full-time
librarian, full-time counselor certified under Subchapter B, or
full-time school nurse not less than the minimum monthly salary,
based on the employee's level of experience, determined by the
following formula:
MS = SF x FS
where:
"MS" is the minimum monthly salary;
"SF" is the applicable salary factor specified by Subsection
(c); and
"FS" is the amount, as determined by the commissioner under
Subsection (b), of state and local funds per weighted student,
including funds provided under Section 42.2516, available to a
district eligible to receive state assistance under Section 42.302
with a maintenance and operations [an enrichment] tax rate of $1.33
on the $100 valuation of taxable property[, as defined by Section
42.302, equal to the maximum rate authorized under Section
42.303], except that the amount of state and local funds per
weighted student does not include the amount attributable to the
increase in the guaranteed level made by Chapter 1187 [H.B. No.
3343], Acts of the 77th Legislature, Regular Session, 2001.
SECTION 1.07. Section 30.003, Education Code, is amended by
adding Subsection (f-1) to read as follows:
(f-1) The commissioner shall determine the total amount
that the Texas School for the Blind and Visually Impaired and the
Texas School for the Deaf would have received from school districts
in accordance with this section if __.B. No. ____, Acts of the 79th
Legislature, 3rd Called Session, 2006, had not reduced the
districts' share of the cost of providing education services. That
amount, minus any amount the schools do receive from school
districts, shall be set aside as a separate account in the
foundation school fund and appropriated to those schools for
educational purposes.
SECTION 1.08. Section 44.004, Education Code, is amended by
adding Subsection (c-1) to read as follows:
(c-1) The notice described by Subsection (c) must state in a
distinct row or on a separate or individual line for each of the
following taxes:
(1) the proposed rate of the school district's
maintenance tax described by Section 45.003, under the heading
"Maintenance Tax"; and
(2) if the school district has issued ad valorem tax
bonds under Section 45.001, the proposed rate of the tax to pay for
the bonds, under the heading "School Debt Service Tax Approved by
Local Voters".
SECTION 1.09. Section 26.08, Tax Code, is amended by
amending Subsections (i) and (k) and adding Subsections (n), (o),
(p), and (q) to read as follows:
(i) For purposes of this section, the effective maintenance
and operations [rollback] tax rate of a school district is [the sum
of:
[(1)] the tax rate that, applied to the current total
value for the district, would impose taxes in an amount that, when
added to state funds that would be distributed to the district under
Chapter 42, Education Code, for the school year beginning in the
current tax year using that tax rate, would provide the same amount
of state funds distributed under Chapter 42 and maintenance and
operations taxes of the district per student in weighted average
daily attendance for that school year that would have been
available to the district in the preceding year if the funding
elements for Chapters 41 and 42, Education Code, for the current
year had been in effect for the preceding year[;
[(2) the rate of $0.06 per $100 of taxable value; and
[(3) the district's current debt rate].
(k) For purposes of this section, for the [2003, 2004,
2005,] 2006, 2007, or 2008 tax year, for a school district that is
entitled to state funds under Sections 1581.1015(d), (e), and (f)
[Section 4(a-1), (a-2), (a-3), (a-4), (a-5), or (a-6), Article
3.50-9], Insurance Code, the effective maintenance and operations
[rollback] tax rate of the district is the sum of:
(1) the tax rate that, applied to the current total
value for the district, would impose taxes in an amount that, when
added to state funds that would be distributed to the district under
Chapter 42, Education Code, for the school year beginning in the
current tax year using that tax rate, would provide the same amount
of state funds distributed under Chapter 42 and maintenance and
operations taxes of the district per student in weighted average
daily attendance for that school year that would have been
available to the district in the preceding year if the funding
elements for Chapters 41 and 42, Education Code, for the current
year had been in effect for the preceding year; and
(2) the tax rate that, applied to the current total
value for the district, would impose taxes in the amount that, when
added to state funds that would be distributed to the district under
Chapter 42, Education Code, for the school year beginning in the
current tax year using that tax rate, permits the district to comply
with Section 1581.052 [3, Article 3.50-9], Insurance Code[;
[(3) the rate of $0.06 per $100 of taxable value; and
[(4) the district's current debt rate].
(n) For purposes of this section, the rollback tax rate of a
school district whose maintenance and operations tax rate for the
2005 tax year was less than $1.50 per $100 of taxable value is:
(1) for the 2006 tax year, the sum of:
(A) the lesser of the following tax rates:
(i) the rate of $1.36 per $100 of taxable
value; or
(ii) the sum of the following tax rates:
(a) the rate that is equal to 88.67
percent of the maintenance and operations tax rate adopted by the
district for the 2005 tax year; and
(b) the rate of $0.06 per $100 of
taxable value; and
(B) the district's current debt rate; and
(2) for the 2007 and subsequent tax years, the
following tax rate, as applicable:
(A) if in the 2006 or any subsequent tax year the
district adopted a maintenance and operations tax rate of at least
$1.36 per $100 of taxable value, the sum of:
(i) the lesser of the following tax rates:
(a) the highest maintenance and
operations tax rate adopted by the district in any of those years;
or
(b) the sum of the following tax
rates:
(1) the effective maintenance
and operations tax rate of the district as computed under
Subsection (i) or (k), as applicable; and
(2) the rate of $0.06 per $100 of
taxable value; and
(ii) the district's current debt rate; or
(B) if in the 2006 and each subsequent tax year
the district adopted a maintenance and operations tax rate of less
than $1.36 per $100 of taxable value, the sum of:
(i) the lesser of the following tax rates:
(a) the rate of $1.36 per $100 of
taxable value; or
(b) the sum of the following tax
rates:
(1) the effective maintenance
and operations tax rate of the district as computed under
Subsection (i) or (k), as applicable; and
(2) the rate of $0.06 per $100 of
taxable value; and
(ii) the district's current debt rate.
(o) For purposes of this section, the rollback tax rate of a
school district whose maintenance and operations tax rate for the
2005 tax year was $1.50 per $100 of taxable value is:
(1) for the 2006 tax year, the sum of:
(A) $1.36 per $100 of taxable value; and
(B) the district's current debt rate; and
(2) for the 2007 and subsequent tax years, the sum of:
(A) the lesser of the following tax rates:
(i) the highest maintenance and operations
tax rate adopted by the district in the 2006 or any subsequent tax
year; or
(ii) the sum of the following tax rates:
(a) the effective maintenance and
operations tax rate of the district as computed under Subsection
(i) or (k), as applicable; and
(b) the rate of $0.06 per $100 of
taxable value; and
(B) the district's current debt rate.
(p) For purposes of this section, the rollback tax rate of a
school district permitted by special law on April 1, 2006, to impose
a maintenance and operations tax at a rate greater than $1.50 per
$100 of taxable value is:
(1) for the 2006 tax year, the sum of:
(A) the rate that is equal to 88.67 percent of the
maintenance and operations tax rate adopted by the district for the
2005 tax year;
(B) the rate of $0.03 per $100 of taxable value;
and
(C) the district's current debt rate; and
(2) for the 2007 and subsequent tax years, the sum of:
(A) the lesser of the following tax rates:
(i) the highest maintenance and operations
tax rate adopted by the district in the 2006 or any subsequent tax
year; or
(ii) the sum of the following tax rates:
(a) the effective maintenance and
operations tax rate of the district as computed under Subsection
(i) or (k), as applicable; and
(b) the rate of $0.06 per $100 of
taxable value; and
(B) the district's current debt rate.
(q) Notwithstanding Section 45.003, Education Code, or any
other law, a school district described by Subsection (p) may not
adopt a maintenance and operations tax rate that exceeds the sum of
the tax rate described by Subsection (p)(1)(A) and $0.17 per $100 of
taxable value.
SECTION 1.10. (a) Section 31.01(c), Tax Code, as amended by
Chapters 1255 and 1368, Acts of the 79th Legislature, Regular
Session, 2005, is reenacted and amended to read as follows:
(c) The tax bill or a separate statement accompanying the
tax bill shall:
(1) identify the property subject to the tax;
(2) state the appraised value, assessed value, and
taxable value of the property;
(3) if the property is land appraised as provided by
Subchapter C, D, E, or H, Chapter 23, state the market value and the
taxable value for purposes of deferred or additional taxation as
provided by Section 23.46, 23.55, 23.76, or 23.9807, as applicable;
(4) state the assessment ratio for the unit;
(5) state the type and amount of any partial exemption
applicable to the property, indicating whether it applies to
appraised or assessed value;
(6) state the total tax rate for the unit;
(7) state the amount of tax due, the due date, and the
delinquency date;
(8) explain the payment option and discounts provided
by Sections 31.03 and 31.05, if available to the unit's taxpayers,
and state the date on which each of the discount periods provided by
Section 31.05 concludes, if the discounts are available;
(9) state the rates of penalty and interest imposed
for delinquent payment of the tax; and
(10) include the name and telephone number of the
assessor for the unit and, if different, of the collector for the
unit[;
[(11) for real property, state for the current tax
year and each of the preceding five tax years:
[(A) the appraised value and taxable value of the
property;
[(B) the total tax rate for the unit;
[(C) the amount of taxes imposed on the property
by the unit; and
[(D) the difference, expressed as a percent
increase or decrease, as applicable, in the amount of taxes imposed
on the property by the unit compared to the amount imposed for the
preceding tax year;
[(11) for real property, state the differences,
expressed as a percent increase or decrease, as applicable, in the
following for the current tax year as compared to the fifth tax year
before that tax year:
[(A) the appraised value of the property; and
[(B) the amount of taxes imposed on the property
by the unit; and
[(12) for real property, state the differences,
expressed as a percent increase or decrease, as applicable, in the
following for the current tax year as compared to the fifth tax year
before that tax year:
[(A) the appraised value and taxable value of the
property;
[(B) the total tax rate for the unit; and
[(C) the amount of taxes imposed on the property
by the unit; and
[(13) include any other information required by the
comptroller].
(b) Section 31.01, Tax Code, is amended by adding Subsection
(d-1) to read as follows:
(d-1) This subsection applies only to a school district. In
addition to stating the total tax rate for the school district, the
tax bill or the separate statement shall separately state:
(1) the maintenance and operations rate of the school
district;
(2) if the school district has outstanding debt, as
defined by Section 26.012, the debt rate of the district;
(3) the maintenance and operations rate of the school
district for the preceding tax year;
(4) if for the current tax year the school district
imposed taxes for debt, as defined by Section 26.012, the debt rate
of the district for the current tax year;
(5) if for the preceding tax year the school district
imposed taxes for debt, as defined by Section 26.012, the debt rate
of the district for that year; and
(6) the total tax rate of the district for the
preceding tax year.
(c) Section 31.01(c-1), Tax Code, as added by Chapter 1255,
Acts of the 79th Legislature, Regular Session, 2005, is repealed.
(d) Section 31.01(c-1), Tax Code, as added by Chapter 1368,
Acts of the 79th Legislature, Regular Session, 2005, is repealed.
(e) Notwithstanding Section 4.01 of this Act, the change in
law made by this section applies only to an ad valorem tax bill that
is mailed on or after the effective date of this Act.
(f) If this Act is passed by the legislature without
receiving a vote of two-thirds of all the members elected to each
house and is approved by the governor, any action taken before the
effective date of this Act in preparation for the implementation of
the amendment made by this Act to Section 31.01, Tax Code, by an
officer or employee of a taxing unit that the officer or employee
determines is necessary or appropriate and that the officer or
employee would have been authorized to take had this section been in
effect at the time of the action is validated as of the effective
date of this Act. A tax bill or separate statement accompanying the
tax bill mailed before the effective date of this section that is in
compliance with Section 31.01, Tax Code, as amended by this Act, is
validated as of the effective date of this Act.
SECTION 1.11. Section 311.013, Tax Code, is amended by
adding Subsection (n) to read as follows:
(n) This subsection applies only to a school district whose
taxable value computed under Section 403.302(d), Government Code,
is reduced in accordance with Subdivision (5) of that subsection.
In addition to the amount otherwise required to be paid into the tax
increment fund, the district shall pay into the fund an amount equal
to the amount by which the amount of taxes the district would have
been required to pay into the fund in the current year if the
district levied taxes at the rate the district levied in 2005
exceeds the amount the district is otherwise required to pay into
the fund in the year of the reduction, not to exceed the amount the
school district realizes from the reduction in the school
district's taxable value under Section 403.302(d)(5), Government
Code.
SECTION 1.12. Section 403.302, Government Code, is amended
by amending Subsections (d) and (i) and adding Subsection (d-1) 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) for a school district for which a deduction from
taxable value is made under Subdivision (4), an amount equal to the
taxable value required to generate revenue when taxed at the school
district's current tax rate in an amount that, when added to the
taxes of the district paid into a tax increment fund as described by
Subdivision (4)(B), is equal to the total amount of taxes the
district would have paid into the tax increment fund if the district
levied taxes at the rate the district levied in 2005;
(6) the total dollar amount of any exemptions granted
under Section 11.251, Tax Code;
(7) [(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;
(8) [(7)] the portion of the appraised value of
residence homesteads of individuals who receive a tax limitation
under Section 11.26, Tax Code, 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;
(9) [(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;
(10) [(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;
(11) [(10)] the appraised value of property the
collection of delinquent taxes on which is deferred under Section
33.06, Tax Code;
(12) [(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
(13) [(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.
(d-1) For a school district for which in the 2005 tax year a
deduction from taxable value is made under Subsection (d)(4), the
comptroller shall certify to the commissioner of education a final
taxable value for the 2005 tax year, calculated as if the reduction
in the school district's ad valorem tax rate and the method of
calculating the amount of the deduction from taxable value under
Subsection (d)(5) required by __.B. No. ____, Acts of the 79th
Legislature, 3rd Called Session, 2006, took effect September 1,
2005. This subsection expires September 1, 2007.
(i) If the comptroller determines in the annual study that
the market value of property in a school district as determined by
the appraisal district that appraises property for the school
district, less the total of the amounts and values listed in
Subsection (d) as determined by that appraisal district, is valid,
the comptroller, in determining the taxable value of property in
the school district under Subsection (d), shall for purposes of
Subsection (d)(13) [(d)(12)] subtract from the market value as
determined by the appraisal district of residence homesteads to
which Section 23.23, Tax Code, applies the amount by which that
amount exceeds the appraised value of those properties as
calculated by the appraisal district under Section 23.23, Tax Code.
If the comptroller determines in the annual study that the market
value of property in a school district as determined by the
appraisal district that appraises property for the school district,
less the total of the amounts and values listed in Subsection (d) as
determined by that appraisal district, is not valid, the
comptroller, in determining the taxable value of property in the
school district under Subsection (d), shall for purposes of
Subsection (d)(13) [(d)(12)] subtract from the market value as
estimated by the comptroller of residence homesteads to which
Section 23.23, Tax Code, applies the amount by which that amount
exceeds the appraised value of those properties as calculated by
the appraisal district under Section 23.23, Tax Code.
SECTION 1.13. (a) Section 11.26, Tax Code, is amended by
adding Subsections (a-1) and (a-2) to read as follows:
(a-1) Notwithstanding the other provisions of this section
and except as provided by Subsection (a-2), if in the current tax
year an individual qualifies for a limitation on tax increases
provided by this section on the individual's residence homestead
and the individual or the individual's spouse qualified for an
exemption under Section 11.13(c) for the same homestead in the
preceding tax year, the amount of the limitation provided by this
section on the homestead in the current tax year is equal to the
lesser of:
(1) the amount computed by:
(A) multiplying the amount of tax the school
district imposed on the homestead in the preceding tax year by the
lesser of one or a fraction the numerator of which is the tax rate of
the district for the current tax year and the denominator of which
is the tax rate of the district for the preceding tax year; and
(B) adding to the amount computed under Paragraph
(A) any tax in the current tax year attributable to improvements
made in the preceding tax year, as provided by Subsection (b); or
(2) the amount of the limitation on tax increases on
the homestead as otherwise provided by this section.
(a-2) Notwithstanding the other provisions of this section,
if in the 2007 tax year an individual qualifies for a limitation on
tax increases provided by this section on the individual's
residence homestead and the first tax year the individual or the
individual's spouse qualified for an exemption under Section
11.13(c) for the same homestead was a tax year before the 2006 tax
year, the amount of the limitation provided by this section on the
homestead in the 2007 tax year is equal to the amount computed by:
(1) multiplying the amount of tax the school district
imposed on the homestead in the 2005 tax year by the lesser of one or
a fraction the numerator of which is the tax rate of the district
for the 2006 tax year and the denominator of which is the tax rate of
the district for the 2005 tax year;
(2) adding to the amount computed under Subdivision
(1) any tax in the 2006 tax year attributable to improvements made
in the 2005 tax year, as provided by Subsection (b);
(3) multiplying the amount computed under Subdivision
(2) by the lesser of one or a fraction the numerator of which is the
tax rate of the district for the 2007 tax year and the denominator
of which is the tax rate of the district for the 2006 tax year; and
(4) adding to the amount computed under Subdivision
(3) any tax in the 2007 tax year attributable to improvements made
in the 2006 tax year, as provided by Subsection (b).
(b) Section 42.2511(a), Education Code, is amended to read
as follows:
(a) Notwithstanding any other provision of this chapter, a
school district is entitled to additional state aid to the extent
that state aid under this chapter based on the determination of the
school district's taxable value of property as provided under
Subchapter M, Chapter 403, Government Code, does not fully
compensate the district for ad valorem tax revenue lost due to:
(1) the increase in the homestead exemption under
Section 1-b(c), Article VIII, Texas Constitution, as proposed by
H.J.R. No. 4, 75th Legislature, Regular Session, 1997, and the
additional limitation on tax increases under Section 1-b(d),
Article VIII, Texas Constitution, as proposed by H.J.R. No. 4, 75th
Legislature, Regular Session, 1997; and
(2) the reduction of the limitation on tax increases
to reflect any reduction in the school district tax rate as provided
by Section 11.26(a-1) or (a-2), Tax Code, as applicable.
(c) Section 403.302, Government Code, is amended by
amending Subsection (j) and adding Subsection (j-1) to read as
follows:
(j) For purposes of Section 42.2511, Education Code, the
comptroller shall certify to the commissioner of education:
(1) a final value for each school district computed on
a residence homestead exemption under Section 1-b(c), Article VIII,
Texas Constitution, of $5,000; [and]
(2) a final value for each school district computed
on:
(A) a residence homestead exemption under
Section 1-b(c), Article VIII, Texas Constitution, of $15,000; and
(B) the effect of the additional limitation on
tax increases under Section 1-b(d), Article VIII, Texas
Constitution, as proposed by H.J.R. No. 4, 75th Legislature,
Regular Session, 1997; and
(3) a final value for each school district computed on
the effect of the reduction of the limitation on tax increases to
reflect any reduction in the school district tax rate as provided by
Section 11.26(a-1) or (a-2), Tax Code, as applicable.
(j-1) For purposes of applying Subsection (j)(3) in the
2007-2008 school year, the comptroller shall compute the final
value under that subsection as if the reduction of the limitation on
tax increases to reflect any reduction in the school district tax
rate as provided by Section 11.26(a-1) or (a-2), Tax Code, as
applicable, had taken effect in the 2006 tax year. This subsection
expires September 1, 2008.
(d) This section applies only to an ad valorem tax year that
begins on or after January 1, 2007.
(e) This section takes effect January 1, 2007, but only if
the constitutional amendment proposed by the 79th Legislature, 3rd
Called Session, 2006, authorizing the legislature to provide for a
reduction of the limitation on the total amount of ad valorem taxes
that may be imposed for public school purposes on the residence
homesteads of the elderly or disabled to reflect any reduction in
the rate of those taxes is approved by the voters. If that
amendment is not approved by the voters, this section has no effect.
SECTION 1.14. (a) Not later than September 1, 2006, the
secretary of state shall:
(1) prepare a notice that includes a brief explanation
of the property tax reduction provisions of this Act; and
(2) distribute a copy of the notice to the tax assessor
for each school district in this state.
(b) On October 1, 2006, or as soon thereafter as
practicable, the tax assessor for each school district in this
state shall mail a copy of the notice to each owner of taxable
property as shown on the appraisal roll for the school district.
The tax assessor should include a copy of the notice with each tax
bill for the school district for the 2006 tax year, if practicable.
No statewide official other than the secretary of state shall be
authorized to distribute the information required by this section.
(c) This section expires January 1, 2007.
ARTICLE 2. FISCAL ACCOUNTABILITY
SECTION 2.01. Chapter 1, Education Code, is amended by
adding Section 1.005 to read as follows:
Sec. 1.005. EDUCATION RESEARCH CENTERS; SHARING STUDENT
INFORMATION. (a) In this section, "center" means a center for
education research authorized by this section.
(b) The commissioner of education and the commissioner of
higher education may establish not more than three centers for
education research for conducting research described by
Subsections (e) and (f).
(c) A center may be established as part of:
(1) the Texas Education Agency;
(2) the Texas Higher Education Coordinating Board; or
(3) a public junior college, public senior college or
university, or public state college, as those terms are defined by
Section 61.003.
(d) A center may be operated under a memorandum of
understanding between the commissioner of education, the
commissioner of higher education, and the governing board of an
educational institution described by Subsection (c)(3). The
memorandum of understanding must require the commissioner of
education, or a person designated by the commissioner, and the
commissioner of higher education, or a person designated by the
commissioner, to provide direct, joint supervision of the center
under this section.
(e) A center shall conduct research for the benefit of
education in this state, including research relating to the impact
of state and federal education programs, the performance of
educator preparation programs, public school finance, and the best
practices of school districts with regard to classroom instruction,
bilingual education programs, special language programs, and
business practices.
(f) The commissioner of education and the commissioner of
higher education:
(1) under the memorandum of understanding described by
Subsection (d), may require a center to conduct certain research
projects considered of particular importance to the state, as
determined by the commissioners; and
(2) not later than the 45th day before the date a
research project required to be conducted under this subsection is
scheduled to begin, shall notify the governor, the Legislative
Budget Board, and the governing body of the educational institution
in which the center is established that the research project is
required.
(g) In conducting research under this section, a center:
(1) may use data on student performance, including
data that is confidential under the Family Educational Rights and
Privacy Act of 1974 (20 U.S.C. Section 1232g), the center has
collected from the Texas Education Agency, the Texas Higher
Education Coordinating Board, the Educators' Professional
Practices Board, any public or private institution of higher
education, and any school district; and
(2) shall comply with rules adopted by the
commissioner of education and the commissioner of higher education
to protect the confidentiality of student information, including
rules establishing procedures to ensure that confidential student
information is not duplicated or removed from a center in an
unauthorized manner.
(h) The commissioner of education and the commissioner of
higher education may:
(1) accept gifts and grants to be used in operating one
or more centers; and
(2) by rule impose reasonable fees, as appropriate,
for the use of a center's research, resources, or facilities.
(i) This section does not authorize the disclosure of
student information that may not be disclosed under the Family
Educational Rights and Privacy Act of 1974 (20 U.S.C. Section
1232g).
(j) The commissioner of education and the commissioner of
higher education shall adopt rules as necessary to implement this
section.
(k) In implementing this section, the commissioner of
education may use funds appropriated to the agency and available
for that purpose, including Foundation School Program funds.
SECTION 2.02. Subchapter A, Chapter 7, Education Code, is
amended by adding Sections 7.008 and 7.009 to read as follows:
Sec. 7.008. PUBLIC ACCESS TO PEIMS DATA. (a) The
commissioner with the assistance of an advisory panel described by
Subsection (b) shall develop a request for proposal for a qualified
third-party contractor to develop and implement procedures to make
available, through the agency Internet website, all financial and
academic performance data submitted through the Public Education
Information Management System (PEIMS) for school districts and
campuses.
(b) The commissioner shall appoint an advisory panel to
assist the commissioner in developing requirements for a system
that is easily accessible by the general public and contains
information of primary relevance to the public. The advisory panel
shall consist of:
(1) educators;
(2) interested stakeholders;
(3) business leaders; and
(4) other interested members of the public.
(c) The procedures developed under this section must
provide:
(1) a summarized format easily understood by the
public for reporting financial and academic performance
information on the agency Internet website; and
(2) the ability for those who access the Internet
website to view and download state, district, and campus level
information.
(d) This section does not authorize the disclosure of
student information that may not be disclosed under the Family
Educational Rights and Privacy Act of 1974 (20 U.S.C. Section
1232g). The commissioner shall adopt rules to protect the
confidentiality of student information.
(e) The procedures to make available, through the agency
Internet website, all financial and academic performance
information for school districts and campuses as described by this
section shall be implemented not later than August 1, 2007. This
subsection expires August 1, 2009.
Sec. 7.009. BEST PRACTICES; CLEARINGHOUSE. (a) In
coordination with the Legislative Budget Board, the agency shall
establish an online clearinghouse of information relating to best
practices of campuses and school districts regarding instruction,
public school finance, resource allocation, and business
practices. To the extent practicable, the agency shall ensure that
information provided through the online clearinghouse is specific,
actionable information relating to the best practices of
high-performing and highly efficient campuses and school districts
rather than general guidelines relating to campus and school
district operation. The information must be accessible by campuses,
school districts, and interested members of the public.
(b) The agency shall solicit and collect from the
Legislative Budget Board, centers for education research
established under Section 1.005, and exemplary or recognized school
districts and open-enrollment charter schools, as rated under
Section 39.072, examples of best practices relating to instruction,
public school finance, resource allocation, and business
practices, including best practices relating to curriculum, scope
and sequence, compensation and incentive systems, bilingual
education and special language programs, compensatory education
programs, and the effective use of instructional technology,
including online courses.
(c) The agency shall contract for the services of one or
more third-party contractors to develop, implement, and maintain a
system of collecting and evaluating the best practices of campuses
and school districts as provided by this section. In addition to
any other considerations required by law, the agency must consider
an applicant's demonstrated competence and qualifications in
analyzing campus and school district practices in awarding a
contract under this subsection.
(d) The commissioner may purchase from available funds
curriculum and other instructional tools identified under this
section to provide for use by school districts.
SECTION 2.03. Subchapter C, Chapter 7, Education Code, is
amended by adding Section 7.061 to read as follows:
Sec. 7.061. FUNDING FOR CERTAIN PURPOSES. The
commissioner, to the extent not specifically prohibited by state or
federal law, shall use federal funds, including consolidated
administrative or innovative program funds, for the purposes
described by Sections 1.005, 7.008, 7.009, 11.003, 44.0061, and
44.011.
SECTION 2.04. Subchapter A, Chapter 11, Education Code, is
amended by adding Section 11.003 to read as follows:
Sec. 11.003. ADMINISTRATIVE EFFICIENCY. (a) Not later
than December 1, 2006, the commissioner shall evaluate the
feasibility of including a uniform indicator under Section
39.202(b) that measures effective administrative management
through the use of cooperative shared services arrangements. If
the commissioner determines that the adoption of a uniform
indicator described by this subsection is feasible, the
commissioner by rule shall include the indicator in the financial
accountability rating system under Subchapter I, Chapter 39, for
school districts beginning with the 2007-2008 school year. This
subsection expires September 1, 2009.
(b) Each regional education service center shall:
(1) notify each school district served by the center
regarding the opportunities available through the center for
cooperative shared services arrangements within the center's
service area; and
(2) evaluate the need for cooperative shared services
arrangements within the center's service area and consider
expanding center-sponsored cooperative shared services
arrangements.
(c) Each regional education service center shall assist a
school district board of trustees in entering into an agreement
with another district or political subdivision, a regional
education service center, or an institution of higher education as
defined by Section 61.003, for a cooperative shared services
arrangement regarding administrative services, including
transportation, food service, purchasing, and payroll functions.
(d) The commissioner may require a district or an
open-enrollment charter school to enter into an agreement for a
cooperative shared services arrangement if the commissioner
determines that the financial management performance of the
district or school is unsatisfactory.
SECTION 2.05. Subchapter D, Chapter 11, Education Code, is
amended by adding Section 11.170 to read as follows:
Sec. 11.170. INTERNAL AUDITOR. If a school district
employs an internal auditor:
(1) the board of trustees shall select the internal
auditor; and
(2) the internal auditor shall report directly to the
board.
SECTION 2.06. Subchapter A, Chapter 44, Education Code, is
amended by adding Section 44.0041 to read as follows:
Sec. 44.0041. PUBLICATION OF SUMMARY OF PROPOSED BUDGET.
(a) Concurrently with the publication of notice of the budget under
Section 44.004, a school district shall post a summary of the
proposed budget:
(1) on the school district's Internet website; or
(2) if the district has no Internet website, in the
district's central administrative office.
(b) The budget summary must include:
(1) information relating to per student and aggregate
spending on:
(A) instruction;
(B) instructional support;
(C) central administration;
(D) district operations;
(E) debt service; and
(F) any other category designated by the
commissioner; and
(2) a comparison to the previous year's actual
spending.
SECTION 2.07. Subchapter A, Chapter 44, Education Code, is
amended by adding Section 44.0061 to read as follows:
Sec. 44.0061. REVIEW OF ACCOUNTING SYSTEM. (a) The
commissioner shall contract with a qualified third-party
contractor to conduct a comprehensive review of the accounting
systems used by school districts under Section 44.007.
(b) The third-party contractor conducting the review under
this section shall:
(1) provide any recommendations relating to the
accounting systems to:
(A) improve the transparency of district
spending behavior;
(B) provide more thorough information relating
to campus spending; and
(C) facilitate program evaluations, including
evaluations of compensatory education programs; and
(2) evaluate the accounting systems to determine
whether any reporting requirements should be adjusted based on
district size.
(c) Before January 1, 2007, the commissioner shall submit a
report to the legislature describing the results of the review
conducted under this section.
(d) This section expires January 2, 2007.
SECTION 2.08. Section 44.007, Education Code, is amended by
adding Subsection (e) to read as follows:
(e) The State Board of Education shall prepare a report for
the 80th Legislature evaluating the benefits of providing school
districts with standardized accounting software that would meet the
requirements of this section and any other appropriate sections.
The report shall consider any savings and costs to school districts
from having such software provided, including any savings to
districts from no longer paying programming costs in response to
changes in state law or agency or State Board of Education rules.
The report may consider software accessed by alternative methods,
such as web-based methods or network-based methods, as may be most
economical for districts of different sizes. The report shall also
consider any accountability benefits from making the information
collected by such software available on an ongoing basis to the
agency and to the public, and personnel and other costs required for
the agency to review this information continuously to alert school
board members and superintendents of areas of potential waste or
fraud. This subsection expires September 1, 2007.
SECTION 2.09. Subchapter A, Chapter 44, Education Code, is
amended by adding Section 44.011 to read as follows:
Sec. 44.011. SPENDING TARGETS FOR DISTRICT EXPENDITURES.
(a) The commissioner shall annually establish and publish the
proposed expenditures for each school district as determined by the
commissioner based on an evaluation of information relating to the
best practices of campuses and districts as described by Section
7.009. The commissioner shall consider unique characteristics of
the district, including the district's size.
(b) The proposed expenditures to be determined as required
by Subsection (a) must include amounts for:
(1) instructional expenditures;
(2) central administrative expenditures;
(3) district operations; and
(4) any other category designated by the commissioner.
(c) If the board of trustees of a school district intends to
exceed the proposed expenditures established by the commissioner
under this section, the board must adopt and publish a resolution
that includes an explanation justifying the board's actions.
ARTICLE 3. APPROPRIATION
SECTION 3.01. There is appropriated to the Texas Education
Agency for distribution to the school districts of this state in
accordance with Chapters 41 and 42, Education Code, as amended by
this Act, the amount of $2,385,800,000 in fiscal year 2007 from any
funds in the State Treasury not otherwise appropriated.
SECTION 3.02. Rider 97 following the appropriations to the
Texas Education Agency in Chapter 1369, Acts of the 79th
Legislature, Regular Session, 2005 (the General Appropriations
Act), as amended by Chapter 2, Acts of the 79th Legislature, 1st
Called Session, 2005, is repealed.
ARTICLE 4. APPLICATION AND EFFECTIVE DATE
SECTION 4.01. This Act applies beginning with the 2006-2007
school year.
SECTION 4.02. 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.