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79S30684 UM-D
By: Martinez H.B. No. 86
A BILL TO BE ENTITLED
AN ACT
relating to increasing the amount of the residence homestead
exemption from ad valorem taxation by a school district to $45,000,
providing for an adjustment of the limitation on the total amount of
ad valorem taxes that may be imposed by a school district on the
homesteads of the elderly or disabled to reflect the increased
exemption amount and changes in the school district's ad valorem
tax rate, and protecting school districts against the resulting
loss in local revenue.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 11.13(b), Tax Code, is amended to read as
follows:
(b) An adult is entitled to exemption from taxation by a
school district of $45,000 [$15,000] of the appraised value of the
adult's residence homestead, except that only $5,000 [$10,000] of
the exemption applies [does not apply] to an entity operating under
former Chapter 17, 18, 25, 26, 27, or 28, Education Code, as those
chapters existed on May 1, 1995, as permitted by Section 11.301,
Education Code.
SECTION 2. Section 11.26, Tax Code, is amended by amending
Subsection (a) and adding Subsection (a-1) to read as follows:
(a) 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. A school
district may not increase the total annual amount of ad valorem tax
it imposes on the residence homestead of an individual 65 years of
age or older or on the residence homestead of an individual who is
disabled, as defined by Section 11.13, above the amount of the tax
it imposed in the first tax year in which the individual qualified
that residence homestead for the applicable exemption provided by
Section 11.13(c) for an individual who is 65 years of age or older
or is disabled. 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 same 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 same
exemption, except as provided by Subsection (b). If the first tax
year the individual qualified the residence homestead for the
exemption provided by Section 11.13(c) for individuals 65 years of
age or older or disabled was a tax year before the 2007 [1997] tax
year, the amount of the limitation provided by this section is the
amount of tax the school district imposed for the 2006 [1996] tax
year less an amount equal to the amount determined by multiplying
$30,000 [$10,000] times the tax rate of the school district for the
2007 [1997] tax year, plus any 2007 [1997] tax attributable to
improvements made in 2006 [1996], other than improvements made to
comply with governmental regulations or repairs. If an individual
receives the limitation provided by this section for the
individual's residence homestead and the individual or the
individual's spouse received the limitation in the preceding tax
year for that homestead and the tax rate of the school district for
the current tax year is higher or lower than the tax rate of the
district for the preceding tax year, the total amount of taxes that
may be imposed by the district on the homestead is equal to the
amount of tax the district imposed on the homestead for the
preceding tax year multiplied by 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, plus any tax for the current tax year
attributable to improvements made in the preceding tax year, other
than improvements made to comply with governmental regulations or
repairs, except that the total amount of taxes that may be imposed
may not exceed the amount of taxes imposed by the district for the
later of the 2006 tax year or the tax year in which the limitation
took effect, as that limitation may have been increased in
subsequent tax years or may be increased for the current tax year
because of improvements as authorized by this section.
(a-1) Notwithstanding Subsection (a), if the first tax year
the individual qualified the residence homestead for the exemption
provided by Section 11.13(c) for individuals 65 years of age or
older or disabled was a tax year before the 2007 tax year and the tax
rate of the school district for the 2007 tax year is higher or lower
than the tax rate of the district for the 2006 tax year, the amount
of the limitation provided by this section for the 2007 tax year is
the amount of tax the school district imposed for the 2006 tax year,
increased or reduced, as applicable, in proportion to the increase
or reduction in the tax rate as provided by Subsection (a), less an
amount equal to the amount determined by multiplying $30,000 times
the tax rate of the school district for the 2007 tax year, plus any
2007 tax attributable to improvements made in 2006, other than
improvements made to comply with governmental regulations or
repairs. That limitation continues to apply to the property in
subsequent tax years, subject to the other provisions of this
section.
SECTION 3. 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 amount of the residence
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 corresponding adjustment of the
[additional] limitation on the total amount of ad valorem taxes
that may be imposed for public school purposes on the homesteads of
the elderly or disabled [tax increases] under Section 1-b(d),
Article VIII, Texas Constitution, as proposed by H.J.R. No. 4, 75th
Legislature, Regular Session, 1997;
(2) the increase in the amount of the residence
homestead exemption under Section 1-b(c), Article VIII, Texas
Constitution, as proposed by ___.J.R. No. ___, 79th Legislature,
3rd Called Session, 2006, and the corresponding adjustment of the
limitation on the total amount of ad valorem taxes that may be
imposed for public school purposes on the homesteads of the elderly
or disabled under Section 1-b(d), Article VIII, Texas Constitution,
as proposed by ___.J.R. No. ___, 79th Legislature, 3rd Called
Session, 2006; and
(3) the adjustment 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 in
proportion to any increase or decrease in the tax rate for those
purposes under Section 1-b(d), Article VIII, Texas Constitution, as
proposed by __.J.R. No. ____, 79th Legislature, 3rd Called Session,
2006.
SECTION 4. Section 403.302(j), Government Code, is amended
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 corresponding adjustment
of the [additional] limitation on the total amount of ad valorem
taxes that may be imposed for public school purposes on the
homesteads of the elderly or disabled [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:
(A) a residence homestead exemption under
Section 1-b(c), Article VIII, Texas Constitution, of $45,000, and
the effect of the corresponding adjustment of the limitation on the
total amount of ad valorem taxes that may be imposed for public
school purposes on the homesteads of the elderly or disabled under
Section 1-b(d), Article VIII, Texas Constitution, as proposed by
___.J.R. No. ___, 79th Legislature, 3rd Called Session, 2006; and
(B) the effect of the adjustment 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 in proportion to any increase or decrease in
the tax rate for those purposes under Section 1-b(d), Article VIII,
Texas Constitution, as proposed by __.J.R. No. ____, 79th
Legislature, 3rd Called Session, 2006.
SECTION 5. This Act applies only to an ad valorem tax year
that begins on or after January 1, 2007.
SECTION 6. This Act takes effect January 1, 2007, but only
if the constitutional amendment proposed by __.J.R. No. ___, 79th
Legislature, 3rd Called Session, 2006, is approved by the voters.
If that constitutional amendment is not approved by the voters,
this Act has no effect.