79R4750 JD/BDH-D
By: Guillen H.B. No. 1198
A BILL TO BE ENTITLED
AN ACT
relating to public education, public school finance, a state
property tax, and related matters.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. EDUCATION FUNDING
SECTION 1.01. Subtitle I, Title 2, Education Code, is
amended by adding Chapter 42 to read as follows:
CHAPTER 42. TEXAS EDUCATION EXCELLENCE PROGRAM
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 42.001. STATE POLICY. (a) It is the policy of this
state that the provision of public education is a state
responsibility and that a thorough and efficient system must be
provided and substantially financed through state revenue sources
so that each student enrolled in the public school system has access
to programs and services that are appropriate to the student's
educational needs and are substantially equal to those available to
any similar student, notwithstanding varying local economic
factors.
(b) The public school finance system of this state must
adhere to a standard of neutrality that provides for substantially
equal access to similar revenue per student after acknowledging all
legitimate student and district cost differences.
Sec. 42.002. PURPOSE OF TEXAS EDUCATION EXCELLENCE PROGRAM.
(a) The purpose of the Texas Education Excellence Program set forth
in this chapter is to guarantee that each school district in the
state has adequate resources to provide each eligible student an
instructional program and facilities suitable to the student's
educational needs.
(b) The Texas Education Excellence Program consists of:
(1) a basic program, as provided by this chapter, that
provides for sufficient financing for all school districts to
provide a basic program of education that is rated academically
acceptable or higher under Subchapter D, Chapter 39, and meets
other applicable legal standards;
(2) an enrichment program, as provided by Subchapter
E, that provides substantially equal access to funds to provide an
enriched program; and
(3) the school facilities assistance program, as
provided by Chapter 46.
Sec. 42.003. STUDENT ELIGIBILITY. (a) A student is
entitled to the benefits of the Texas Education Excellence Program
if the student is five years of age or older and under 21 years of
age on September 1 of the school year and has not graduated from
high school.
(b) A student to whom Subsection (a) does not apply is
entitled to the benefits of the Texas Education Excellence Program
if the student is enrolled in a prekindergarten class under Section
29.153.
(c) A child may be enrolled in the first grade if the child
is at least six years of age at the beginning of the district's
school year or has been enrolled in the first grade or has completed
kindergarten in the public schools in another state before
transferring to a public school in this state.
(d) Notwithstanding Subsection (a), a student younger than
five years of age is entitled to the benefits of the Texas Education
Excellence Program if:
(1) the student performs satisfactorily on the
assessment instrument administered under Section 39.023(a) to
students in the third grade; and
(2) the district has adopted a policy for admitting
students younger than five years of age.
Sec. 42.004. ADMINISTRATION OF PROGRAM. The commissioner,
in accordance with rules adopted by the State Board of Education,
shall administer the Texas Education Excellence Program.
Sec. 42.005. AVERAGE DAILY ATTENDANCE. (a) In this
chapter, average daily attendance is:
(1) the quotient of the sum of attendance for each day
of the minimum number of days of instruction as described under
Section 25.081(a) divided by the minimum number of days of
instruction; or
(2) for a district that operates under a flexible year
program under Section 29.0821, the quotient of the sum of
attendance for each actual day of instruction as permitted by
Section 29.0821(b)(1) divided by the number of actual days of
instruction as permitted by Section 29.0821(b)(1).
(b) A school district that experiences a decline of two
percent or more in average daily attendance shall be funded on the
basis of:
(1) the actual average daily attendance of the
preceding school year, if the decline is the result of the closing
or reduction in personnel of a military base; or
(2) subject to Subsection (e), an average daily
attendance not to exceed 98 percent of the actual average daily
attendance of the preceding school year, if the decline is not the
result of the closing or reduction in personnel of a military base.
(c) The commissioner shall adjust the average daily
attendance of a school district that has a significant percentage
of students who are migratory children as defined by 20 U.S.C.
Section 6399.
(d) The commissioner may adjust the average daily
attendance of a school district in which a disaster, flood, extreme
weather condition, fuel curtailment, or other calamity has a
significant effect on the district's attendance.
(e) For each school year, the commissioner shall adjust the
average daily attendance of school districts that are entitled to
funding on the basis of an adjusted average daily attendance under
Subsection (b)(2) so that:
(1) all districts are funded on the basis of the same
percentage of the preceding year's actual average daily attendance;
and
(2) the total cost to the state does not exceed the
amount specifically appropriated for that year for purposes of
Subsection (b)(2).
(f) An open-enrollment charter school is not entitled to
funding based on an adjustment under Subsection (b)(2).
Sec. 42.006. FUNDING ELEMENTS. (a) The Legislative Budget
Board shall adopt rules, subject to appropriate notice and
opportunity for public comment, for the computation for each year
of a biennium of the funding elements, in accordance with
Subsection (c), necessary to achieve the state policy under Section
42.001.
(b) Before each regular session of the legislature, the
board shall report the funding elements to the commissioner and the
legislature.
(c) The funding elements must include:
(1) a basic allotment for the purposes of Section
42.051 that represents the cost per student of an education program
that is rated academically acceptable or higher under Section
39.072 and meets all other mandates of law and regulation;
(2) adjustments designed to reflect the variation in
known resource costs and costs of education beyond the control of
school districts;
(3) appropriate program cost differentials and other
funding elements for programs authorized under Chapter 29 with the
program funding level expressed as dollar amounts and as weights
applied to the basic allotment for the appropriate year;
(4) the maximum guaranteed level of state and local
funds per student for the purposes of the enrichment program under
Subchapter E; and
(5) the amount to be appropriated for the school
facilities assistance programs under Chapter 46.
(d) The board shall conduct a study on the funding elements
each biennium. The study must include a determination of the
projected cost to the state in the next state fiscal biennium of
ensuring the ability of each school district to maintain existing
programs without increasing property tax rates.
[Sections 42.007-42.050 reserved for expansion]
SUBCHAPTER B. STUDENT ALLOTMENTS
Sec. 42.051. BASIC ALLOTMENT. (a) For each student in
average daily attendance, not including the time students spend
each day in special education programs other than mainstream or
career and technology programs, a school district is entitled to a
basic allotment of $4,330.
(b) A basic allotment in a greater amount for any school
year may be provided by appropriation.
(c) In addition to the basic allotment, a school district is
entitled to special student allotments as provided by this
subchapter.
Sec. 42.052. SPECIAL EDUCATION ALLOTMENTS. (a) In this
section:
(1) "Full-time equivalent student" means 30 hours of
contact a week between a student and special education program
personnel.
(2) "Special education program" means a program under
Subchapter A, Chapter 29.
(b) For each student in average daily attendance in a
special education program in a mainstream instructional
arrangement, a school district is entitled to an allotment in an
amount equal to the basic allotment multiplied by a weight of 1.1.
(c) For each full-time equivalent student in average daily
attendance in a special education program in an instructional
arrangement other than a mainstream instructional arrangement, a
school district is entitled to an allotment in an amount equal to
the basic allotment multiplied by the following weights determined
by the student's instructional arrangement:
(1) 5.0, for a student in a homebound instructional
arrangement;
(2) 3.0, for a student in a hospital class
instructional arrangement;
(3) 5.0, for a student in a speech therapy
instructional arrangement;
(4) 3.0, for a student in a resource room
instructional arrangement;
(5) 3.0, for a student in a self-contained, mild and
moderate, regular campus instructional arrangement;
(6) 3.0, for a student in a self-contained, severe,
regular campus instructional arrangement;
(7) 2.7, for a student in an off-home-campus
instructional arrangement;
(8) 1.7, for a student in a nonpublic day school;
(9) 2.3, for a student in a vocational adjustment
class;
(10) 4.0, for a student who resides in a residential
care and treatment facility, other than a state school, whose
parent or guardian does not reside in the district, and who receives
educational services from a local school district; and
(11) 2.8, for a student who resides in a state school.
Sec. 42.053. BILINGUAL EDUCATION AND SPECIAL LANGUAGE
ALLOTMENTS. A school district is entitled to an allotment in an
amount equal to the basic allotment multiplied by a weight of 0.1
for each student in average daily attendance who is in a bilingual
education or special language program under Subchapter B, Chapter
29.
Sec. 42.054. COMPENSATORY EDUCATION ALLOTMENTS. (a) For
each student in average daily attendance who is educationally
disadvantaged or who is a student who does not have a disability and
resides in a residential placement facility in a district in which
the student's parent or guardian does not reside, a school district
is entitled to an allotment in an amount equal to the basic
allotment multiplied by a weight of 0.2.
(b) For each full-time equivalent student in average daily
attendance who is in a remedial and support program under Section
29.081 because the student is pregnant, a school district is
entitled to an allotment in an amount equal to the basic allotment
multiplied by a weight of 2.41.
(c) For purposes of this section, the number of
educationally disadvantaged students is determined:
(1) by averaging the best six months' enrollment in the
national school lunch program of free or reduced-price lunches for
the preceding school year; or
(2) in the manner provided by commissioner rule, if no
campus in the district participated in the national school lunch
program of free or reduced-price lunches during the preceding
school year.
Sec. 42.055. GIFTED AND TALENTED STUDENT ALLOTMENT. (a)
For each student in average daily attendance who is in a program for
gifted and talented students that the district certifies to the
commissioner as complying with Subchapter D, Chapter 29, a school
district is entitled to an allotment in an amount equal to the basic
allotment multiplied by a weight of 0.12.
(b) Not more than five percent of a district's students in
average daily attendance are eligible for funding under this
section.
Sec. 42.056. CAREER AND TECHNOLOGY ALLOTMENT. (a) In this
section, "full-time equivalent student" means 30 hours of contact a
week between a student and career and technology education program
personnel.
(b) For each full-time equivalent student in average daily
attendance who is in an approved career and technology education
program in grades 9 through 12 or in a career and technology program
for students with disabilities in grades 7 through 12, a school
district is entitled to an allotment in an amount equal to the basic
allotment multiplied by a weight of 1.35.
Sec. 42.057. PUBLIC EDUCATION GRANT ALLOTMENT. (a) For
each student in average daily attendance who is using a public
education grant under Subchapter G, Chapter 29, to attend school in
a district other than the district in which the student resides, a
school district is entitled to an allotment in an amount equal to
the basic allotment multiplied by a weight of 0.1.
(b) The total number of allotments under this section to
which a district is entitled may not exceed the number by which the
number of students using public education grants to attend school
in the district exceeds the number of students who reside in the
district and use public education grants to attend school in
another district.
[Sections 42.058-42.080 reserved for expansion]
Sec. 42.081. COST OF EDUCATION ADJUSTMENT. (a) The basic
allotment for each district is adjusted to reflect the geographic
variation in known resource costs and costs of education due to
factors beyond the control of the school district.
(b) The cost of education adjustment is the cost of
education index adjustment adopted by the foundation school fund
budget committee and contained in Chapter 203, Title 19, Texas
Administrative Code, as that chapter existed on March 26, 1997.
(c) Except as provided by Section 42.082(e), a special
student allotment under this subchapter is determined using a
district's adjusted basic allotment determined under this section.
Sec. 42.082. SMALL AND MID-SIZED DISTRICT ADJUSTMENT. (a)
The basic allotment under Section 42.051 for certain small and
mid-sized districts, as adjusted under Section 42.081, is adjusted
in accordance with this section. In this section:
(1) "ADA" is the number of students in average daily
attendance for which the district is entitled to funding under
Section 42.051;
(2) "ABA" is the adjusted basic allotment as
determined under Section 42.081; and
(3) "SABA" is the district's size-adjusted guaranteed
amount.
(b) The basic allotment under Section 42.051 of a school
district that contains at least 300 square miles and has not more
than 1,600 students in average daily attendance is adjusted by
applying the formula:
SABA = (1 + ((1,600 - ADA) X 0.0004)) X ABA
(c) The basic allotment under Section 42.051 of a school
district that contains less than 300 square miles and has not more
than 1,600 students in average daily attendance is adjusted by
applying the formula:
SABA = (1 + ((1,600 - ADA) X 0.00025)) X ABA
(d) The basic allotment under Section 42.051 of a school
district that offers a kindergarten through grade 12 program and
has less than 5,000 students in average daily attendance is
adjusted by applying the formula, of the following formulas, that
results in the greatest guaranteed amount:
(1) the formula in Subsection (b) or (c) for which the
district is eligible; or
(2) SABA = (1 + ((5,000 - ADA) X 0.000025)) X ABA.
(e) A special student allotment under this subchapter for a
district to which this section applies is determined using the
district's adjusted allotment determined under this section.
Sec. 42.083. SPARSITY ADJUSTMENT. Notwithstanding
Sections 42.051 and 42.081:
(1) a school district that has fewer than 130 students
in average daily attendance is entitled to funding on the basis of
130 students in average daily attendance if the district offers a
kindergarten through grade 12 program and has preceding or current
year's average daily attendance of at least 90 students or is 30
miles or more by bus route from the nearest high school district;
(2) a school district that offers a kindergarten
through grade 8 program and whose preceding or current year's
average daily attendance was or is at least 50 students or that is
30 miles or more by bus route from the nearest high school district
is entitled to funding on the basis of 75 students in average daily
attendance; and
(3) a school district that offers a kindergarten
through grade 6 program and whose preceding or current year's
average daily attendance was or is at least 40 students or that is
30 miles or more by bus route from the nearest high school district
is entitled to funding on the basis of 60 students in average daily
attendance.
[Sections 42.084-42.100 reserved for expansion]
SUBCHAPTER C. TRANSPORTATION ALLOTMENT
Sec. 42.101. TRANSPORTATION ALLOTMENT. Each district or
county operating a transportation system is entitled to allotments
for transportation costs as provided by this subchapter.
Sec. 42.102. DEFINITIONS. In this subchapter:
(1) "Eligible special education student" means a
student who is eligible for special education services under
Section 29.003 and who would be unable to attend classes without
special transportation services.
(2) "Linear density" means the average number of
regular eligible students transported daily, divided by the
approved daily route miles traveled by the respective
transportation system.
(3) "Regular eligible student" means a student who
resides two or more miles from the student's campus of regular
attendance, measured along the shortest route that may be traveled
on public roads, and who is not classified as a student eligible for
special education services.
Sec. 42.103. REGULAR TRANSPORTATION ALLOTMENT. (a) Each
school district or county operating a regular transportation system
is entitled to an allotment based on the daily cost per regular
eligible student of operating and maintaining the regular
transportation system and the linear density of that system.
(b) In determining the cost, the commissioner shall give
consideration to factors affecting the actual cost of providing
these transportation services in each school district or county.
The commissioner shall compute the average actual cost and shall
report that cost to the Legislative Budget Board for consideration
by the legislature in the General Appropriations Act.
(c) The allotment per mile of approved route may not exceed
the amount set by appropriation.
Sec. 42.104. HAZARDOUS CONDITIONS TRANSPORTATION
ALLOTMENT. (a) A school district or county may apply for and on
approval of the commissioner receive an additional amount of up to
10 percent of its regular transportation allotment to be used for
the transportation of children who live within two miles of the
school they attend and who would be subject to hazardous traffic
conditions if they walked to school.
(b) Each board of trustees shall provide to the commissioner
the definition of hazardous conditions applicable to that district
and shall identify the specific hazardous areas for which the
allotment is requested. A hazardous condition exists where no
walkway is provided and children must walk along or cross a freeway
or expressway, an underpass, an overpass or a bridge, an
uncontrolled major traffic artery, an industrial or commercial
area, or another comparable condition.
Sec. 42.105. PRIVATE OR COMMERCIAL TRANSPORTATION
ALLOTMENT. (a) The commissioner may grant an amount set by
appropriation for private or commercial transportation for
eligible students from isolated areas. The need for this type of
transportation grant shall be determined on an individual basis,
and the amount granted may not exceed the actual cost.
(b) The grants may be made only in extreme hardship cases. A
grant may not be made if the students live within two miles of an
approved school bus route.
Sec. 42.106. TRANSPORTATION OF CAREER AND TECHNOLOGY
EDUCATION STUDENTS. The cost of transporting career and technology
education students from one campus to another inside a school
district or from a sending district to another secondary public
school for a career and technology program or an area career and
technology school or to an approved postsecondary institution under
a contract for instruction approved by the agency shall be
reimbursed based on the number of actual miles traveled times the
district's official extracurricular travel per mile rate as set by
the board of trustees and approved by the agency.
Sec. 42.107. TRANSPORTATION OF SPECIAL EDUCATION STUDENTS.
(a) A school district or county that provides special
transportation services for eligible special education students is
entitled to a state allotment paid on a previous year's
cost-per-mile basis. The maximum rate per mile allowable shall be
set by appropriation based on data gathered from the first year of
each preceding biennium.
(b) A school district may use a portion of its support
allocation to pay transportation costs, if necessary. The
commissioner may grant an amount set by appropriation for private
transportation to reimburse parents or their agents for
transporting eligible special education students. The mileage
allowed shall be computed along the shortest public road from the
student's home to school and back, morning and afternoon. The need
for this type of transportation shall be determined on an
individual basis and shall be approved only in extreme hardship
cases.
Sec. 42.108. DETERMINATION OF TRANSPORTATION ALLOTMENTS OF
DISTRICT BELONGING TO COUNTY TRANSPORTATION SYSTEM. If a school
district belongs to a county transportation system, the district's
transportation allotment is determined on the basis of the number
of approved daily route miles in the district multiplied by the
allotment per mile to which the county transportation system is
entitled.
Sec. 42.109. TRANSPORTATION ALLOTMENT FOR TEXAS SCHOOL FOR
THE DEAF. The Texas School for the Deaf is entitled to an allotment
under this subchapter. The commissioner shall determine the
appropriate allotment.
Sec. 42.110. TRANSPORTATION TO CHILD-CARE FACILITIES.
Notwithstanding any other provision of this subchapter, the
commissioner may not reduce the allotment to which a school
district or county is entitled under this subchapter because, as
authorized by Section 34.007, the district or county provides
transportation for an eligible student to and from a child-care
facility, as defined by Section 42.002, Human Resources Code,
instead of the student's residence, if the transportation is
provided within the approved routes of the district or county for
the school the student attends.
Sec. 42.111. USE OF TRANSPORTATION ALLOTMENTS. Funds
allotted under this subchapter must be used in providing
transportation services.
[Sections 42.112-42.150 reserved for expansion]
SUBCHAPTER D. NEW INSTRUCTIONAL FACILITY ALLOTMENT
Sec. 42.151. NEW INSTRUCTIONAL FACILITY ALLOTMENT. A
school district is entitled to an additional allotment as provided
by this subchapter for operational expenses associated with opening
a new instructional facility.
Sec. 42.152. DEFINITION. In this subchapter,
"instructional facility" has the meaning assigned by Section
46.001.
Sec. 42.153. ALLOTMENT FOR FIRST YEAR OF OPERATION. For the
first school year in which students attend a new instructional
facility, a school district is entitled to an allotment of $250 for
each student in average daily attendance at the facility.
Sec. 42.154. ALLOTMENT FOR SECOND YEAR OF OPERATION. (a)
For the second school year in which students attend a new
instructional facility, a school district is entitled to an
allotment of $250 for each additional student in average daily
attendance at the facility.
(b) For purposes of this section, the number of additional
students in average daily attendance at a facility is the
difference between the number of students in average daily
attendance in the current year at that facility and the number of
students in average daily attendance at that facility in the
preceding year.
Sec. 42.155. LIMITATION ON ALLOTMENTS. (a) The amount
appropriated for allotments under this subchapter may not exceed
$25 million in a school year.
(b) If the total amount of allotments to which school
districts are entitled under this subchapter for a school year
exceeds the amount appropriated for allotments under this
subchapter, the commissioner shall reduce each district's
allotment under this subchapter proportionately.
Sec. 42.156. RULES. The commissioner may adopt rules
necessary to implement this subchapter.
[Sections 42.157-42.200 reserved for expansion]
SUBCHAPTER E. ENRICHMENT PROGRAM
Sec. 42.201. PURPOSE. The purpose of the enrichment
program component of the Texas Education Excellence Program is to
provide each school district with the opportunity to supplement the
basic program at a level of its own choice.
Sec. 42.202. ALLOTMENT. (a) Each school district is
guaranteed a specified amount per student in state and local funds
for each cent of enrichment tax effort up to the maximum level
specified in this subchapter. The amount of state support is
determined by the formula:
EGYA = (EGL X WADA X DETR X 100) - LR
where:
"EGYA" is the guaranteed yield amount of state enrichment
funds to be allocated to the district;
"EGL" is the dollar amount guaranteed level of state and
local enrichment funds per student per cent of tax effort, which is
$100 or a greater amount for any school year provided by
appropriation;
"WADA" is the number of students in weighted average daily
attendance, which is computed by dividing the sum of the school
district's student allotments under Subchapter B, plus 50 percent
of the adjustment under Section 42.081, by the basic allotment for
the applicable year;
"DETR" is the district enrichment tax rate of the school
district, which is determined by dividing the total amount of
enrichment taxes collected by the school district for the
applicable school year by the district's taxable value of property
for the current year as determined, except as provided by
Subsection (b), under Subchapter M, Chapter 403, Government Code,
divided by 100; and
"LR" is the local revenue, which is determined by multiplying
"DETR" by the quotient of the district's taxable value of property
for the current year as determined, except as provided by
Subsection (b), under Subchapter M, Chapter 403, Government Code,
divided by 100.
(b) For purposes of this section, a school district's
taxable value of property is not reduced by the total dollar amount
of any residence homestead tax exemptions granted under Section
11.13(n), Tax Code.
Sec. 42.203. DISTRICT ENRICHMENT TAX. (a) Subject to
Section 42.204, the board of trustees of a school district may
impose an annual ad valorem tax for the further enrichment of the
public schools in the district.
(b) The district enrichment tax rate may not exceed the
lesser of:
(1) $0.10 for each $100 of taxable value of property;
or
(2) the rate necessary to provide local revenue per
student under Section 42.202 in an amount equal to the maximum
amount of state and local enrichment funds per student to which a
school district is entitled under Section 42.202.
(c) An exemption adopted by the board of trustees of a
school district under Section 11.13(n), Tax Code, does not apply to
a tax imposed under this section.
(d) In this section, "tax rate" includes the actual tax rate
adopted by a school district and the tax rate recognized by the
state under Section 42.202.
Sec. 42.204. ENRICHMENT TAX ELECTION. (a) A school
district may not impose an enrichment tax under Section 42.203
unless authorized by a majority of the qualified voters of the
district voting at an election held for that purpose.
(b) A proposition submitted to authorize the imposition of
an enrichment tax must include the question of whether the board of
trustees may impose annual ad valorem taxes for the further
enrichment of public schools, at a rate not to exceed the rate
stated in the proposition.
(c) A district may tax at a rate below the rate authorized in
an election under this section and does not need additional
authority to increase the rate up to the rate authorized in the
election.
Sec. 42.205. DISTRIBUTION OF ENRICHMENT PROGRAM FUNDS. (a)
As provided by Section 42.402, for each school year, the
commissioner shall:
(1) determine the guaranteed yield amount of state
enrichment program funds to which a school district is entitled
under Section 42.202; and
(2) approve and transmit warrants to school districts.
(b) If the total amount of state enrichment funds allocated
to districts under this subchapter for a fiscal year exceeds the
amount appropriated for that year, the commissioner shall reduce
the total amount of state enrichment funds allocated to each
district proportionately. The following fiscal year, a district's
entitlement under this subchapter is increased by an amount equal
to the reduction made under this subsection.
Sec. 42.206. USE OF ALLOTMENT. State enrichment funds
allocated under this subchapter may be used for any legal purpose
other than capital outlay and debt service.
Sec. 42.207. COMPUTATION OF ENRICHMENT AID FOR DISTRICT ON
MILITARY RESERVATION OR AT STATE SCHOOL. State enrichment funds
allocated under this subchapter for a school district located on a
federal military installation or at Moody State School are computed
using the average district enrichment tax rate and property value
per student of school districts in the county, as determined by the
commissioner.
[Sections 42.208-42.400 reserved for expansion]
[Subchapters F-H reserved for expansion]
SUBCHAPTER I. FINANCING THE SYSTEM
Sec. 42.401. FINANCING; GENERAL RULE. (a) The sum of the
student allotments under Subchapter B, the transportation
allotments under Subchapter C, the new instructional facility
allotments under Subchapter D, and the enrichment program
allotments under Subchapter E constitute the total cost of the
Texas Education Excellence Program.
(b) The program shall be financed by:
(1) revenue generated by the state ad valorem tax
under Section 3-a, Article VII, Texas Constitution;
(2) revenue generated by local school district
enrichment tax effort under Subchapter E;
(3) state available school funds distributed in
accordance with law; and
(4) state funds appropriated for the purposes of
public school education and allocated to each district in an amount
sufficient to finance the cost of each district's Texas Education
Excellence Program not covered by other funds specified by this
subsection.
Sec. 42.402. DISTRIBUTION OF TEXAS EDUCATION FUND. (a) For
each school year the commissioner shall determine:
(1) the amount of money to which a school district is
entitled under Subchapters B, C, and D;
(2) the amount of money to which a school district is
entitled under Subchapter E;
(3) the amount of money allocated to the district from
the available school fund; and
(4) the amount of each district's enrichment program
local revenue under Section 42.202.
(b) Except as provided by this subsection, the commissioner
shall base the determinations under Subsection (a) on the estimates
provided to the legislature under Section 42.403, or, if the
General Appropriations Act provides estimates for that purpose, on
the estimates provided under that Act, for each school district for
each school year. The commissioner shall reduce the entitlement
under Subchapter E of each district that has a final taxable value
of property for the second year of a state fiscal biennium that is
higher than the estimate under Section 42.403 or the General
Appropriations Act, as applicable. A reduction under this
subsection may not reduce the district's entitlement below the
amount to which it is entitled at its actual taxable value of
property. The sum of the reductions under this subsection may not
be greater than the amount necessary to fully fund the entitlement
of each district.
(c) Each school district is entitled to state aid in an
amount equal to the difference for that district between the sum of
Subsections (a)(1), (2), and (3) and the amount determined under
Subsection (a)(4).
(d) Except as provided by Section 42.205, the commissioner
shall approve warrants to each school district equaling the amount
of its entitlement. The total amount of the warrants approved under
this section may not exceed the total amount appropriated for Texas
Education Excellence Program purposes for that fiscal year.
(e) If a school district demonstrates to the satisfaction of
the commissioner that the estimate of the district's enrichment tax
rate, student enrollment, or taxable value of property used in
determining the amount of state funds to which the district is
entitled is so inaccurate as to result in undue financial hardship
to the district, the commissioner may adjust funding to that
district in that school year to the extent that funds are available
for that year.
(f) If the total amount appropriated for a year for the
basic program under the Texas Education Excellence Program is less
than the amount of money to which school districts are entitled for
that year, the commissioner shall reduce the total amount of basic
program funds allocated to each district proportionately. The
following fiscal year, a district's entitlement under this section
is increased by an amount equal to the reduction made under this
subsection.
(g) Not later than March 1 of each year, the commissioner
shall determine the actual amount of state funds to which each
school district is entitled under this chapter for the current
school year and shall compare that amount with the amount of the
warrants issued to each district for that year. If the amount of
the warrants differs from the amount to which a district is entitled
because of variations in the district's enrichment tax rate,
student enrollment, or taxable value of property, the commissioner
shall adjust the district's entitlement for the next fiscal year
accordingly.
Sec. 42.403. ESTIMATES REQUIRED. (a) Not later than
October 1 of each even-numbered year:
(1) the agency shall submit to the legislature an
estimate of the enrichment tax rate and student enrollment of each
school district for the following biennium; and
(2) the comptroller shall submit to the legislature an
estimate of the total taxable value of all property in the state as
determined under Subchapter M, Chapter 403, Government Code, for
the following biennium.
(b) The agency and the comptroller shall update the
information provided to the legislature under Subsection (a) not
later than March 1 of each odd-numbered year.
Sec. 42.404. ADDITIONAL TRANSITIONAL AID. (a)
Notwithstanding Section 42.402, a school district is entitled to
the amount of state revenue necessary to maintain state and local
revenue in an amount equal to the amount of state and local revenue
per student in average daily attendance for maintenance and
operation of the district that would have been available to the
district if the funding elements under Chapters 41 and 42,
Education Code, including any amounts the district would have
received under Rider 82, page III-23, Chapter 1330, Acts of the 78th
Legislature, Regular Session, 2003 (the General Appropriations
Act), in effect during the 2005-2006 school year were in effect for
the current school year.
(b) The commissioner shall:
(1) compute and publish the amount of state and local
revenue per student in average daily attendance to which a district
is entitled under Subsection (a) for the 2005-2006 school year; and
(2) use that amount per student in average daily
attendance in determining the amount to which a district is
entitled under this section in subsequent school years.
(c) The commissioner shall determine the amount of state
funds to which a school district is entitled under this section,
including the amount per student in average daily attendance, and
shall make that determination available to the Legislative Budget
Board. The commissioner's determination is final and may not be
appealed.
Sec. 42.405. FALSIFICATION OF RECORDS; REPORT. When, in
the opinion of the agency's director of school audits, audits or
reviews of accounting, enrollment, or other records of a school
district reveal deliberate falsification of the records, or
violation of the provisions of this chapter, through which the
district's share of state funds allocated under this chapter would
be or has been illegally increased, the director shall promptly and
fully report the fact to the State Board of Education, the state
auditor, and the appropriate county attorney, district attorney, or
criminal district attorney.
Sec. 42.406. PAYMENTS FROM TEXAS EDUCATION FUND. (a)
Payments from the Texas education fund to each school district
shall be made as follows:
(1) 15 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of September of a fiscal year;
(2) 70 percent of the yearly entitlement of the
district shall be paid in six equal installments to be made on or
before the 25th day of October, November, March, May, June, and
July;
(3) five percent of the yearly entitlement of the
district shall be paid in three equal installments to be made on or
before the 25th day of December, January, and February; and
(4) 10 percent of the yearly entitlement of the
district shall be paid in an installment to be made after the fifth
day of September and not later than the 10th day of September of the
calendar year following the calendar year of the payment made under
Subdivision (1).
(b) The amount of any installment required by this section
may be modified to provide a school district with the proper amount
to which the district is entitled and to correct errors in the
allocation or distribution of funds. If an installment under this
section is required to be equal to other installments, the amount of
other installments may be adjusted to provide for that equality.
(c) Except as provided by Subsection (a)(3), any previously
unpaid additional funds from prior years owed to a district shall be
paid to the district together with the September payment of the
current year entitlement.
Sec. 42.407. RECOVERY OF OVERALLOCATED FUNDS. (a) If a
school district has received an overallocation of state funds, the
agency shall, by withholding from subsequent allocations of state
funds or by requesting and obtaining a refund, recover from the
district an amount equal to the overallocation.
(b) If a district fails to comply with a request for a refund
under Subsection (a), the agency shall certify to the comptroller
that the amount constitutes a debt for purposes of Section 403.055,
Government Code. The agency shall provide to the comptroller the
amount of the overallocation and any other information required by
the comptroller. The comptroller may certify the amount of the debt
to the attorney general for collection.
(c) Any amounts recovered under this section shall be
deposited in the Texas education fund.
[Sections 42.408-42.450 reserved for expansion]
SUBCHAPTER J. LIMITATIONS ON PROGRAM ALLOTMENTS
Sec. 42.451. SPECIAL EDUCATION PROGRAMS. (a) For funding
purposes, the number of contact hours credited per day for each
special education student in the off-home-campus instructional
arrangement may not exceed the contact hours credited per day for
the multidistrict class instructional arrangement in the 1992-1993
school year.
(b) For funding purposes, the contact hours credited per day
for each special education student in the resource room;
self-contained, mild and moderate, regular campus; and
self-contained, severe, regular campus instructional arrangements
may not exceed the average of the statewide total contact hours
credited per day for those three instructional arrangements in the
1992-1993 school year.
(c) The State Board of Education by rule shall prescribe the
qualifications a special education instructional arrangement must
meet in order to be funded as a particular instructional
arrangement under this chapter. In prescribing the qualifications
that a mainstream instructional arrangement must meet, the board
shall require that students with disabilities and their teachers
receive the direct, indirect, and support services that are
necessary to enrich the regular classroom and enable student
success.
(d) The State Board of Education shall adopt rules and
procedures governing contracts for residential placement of
special education students. The legislature shall provide by
appropriation for the state's share of the costs of those
placements.
(e) Funds allocated under Section 42.052, as adjusted under
Sections 42.081 and 42.082, other than an indirect cost allotment
established under State Board of Education rule, must be used in the
special education program under Subchapter A, Chapter 29.
(f) The agency shall encourage the placement of students in
special education programs, including students in residential
instructional arrangements, in the least restrictive environment
appropriate for students' educational needs.
(g) Each year, the agency shall make and disseminate to each
school district a list of those districts that maintain for two
successive years a ratio of full-time equivalent special education
students placed in partially or totally self-contained classrooms
to the number of full-time equivalent students placed in resource
room or mainstream instructional arrangements that is 25 percent
higher than the statewide average ratio.
(h) A school district that provides an extended year program
required by federal law for special education students who may
regress is entitled to receive funds in an amount equal to 75
percent, or a lesser percentage determined by the commissioner, of
the basic allotment for each full-time equivalent student in
average daily attendance, multiplied by the amount designated for
the student's instructional arrangement under Section 42.052, for
each day the program is provided divided by the number of days in
the minimum school year. The total amount of state funding for
extended year services under this section may not exceed $10
million per year. A school district may use funds received under
this subsection only in providing an extended year program.
(i) From the total amount of funds appropriated for special
education under this chapter, the commissioner shall withhold an
amount specified in the General Appropriations Act and distribute
that amount to school districts for programs under Section 29.014.
The program established under that section is required only in
school districts in which the program is financed by funds
distributed under this subsection and any other funds available for
the program. After deducting the amount withheld under this
subsection from the total amount appropriated for special
education, the commissioner shall reduce each district's
allocation proportionately.
Sec. 42.452. BILINGUAL EDUCATION AND SPECIAL LANGUAGE
PROGRAMS. (a) Funds allocated under Section 42.053, as adjusted
under Sections 42.081 and 42.082, other than an indirect cost
allotment established under State Board of Education rule, must be
used in providing bilingual education or special language programs
under Subchapter B, Chapter 29, and must be accounted for under
existing agency reporting and auditing procedures.
(b) A district's bilingual education or special language
allocation may be used only for program and student evaluation,
instructional materials and equipment, staff development,
supplemental staff expenses, salary supplements for teachers, and
other supplies required for quality instruction and smaller class
size.
Sec. 42.453. COMPENSATORY EDUCATION PROGRAMS. (a) Funds
allocated under Section 42.054, as adjusted under Sections 42.081
and 42.082, may be used only to fund supplemental programs and
services designed to eliminate any disparity in performance on
assessment instruments administered under Subchapter B, Chapter
39, or disparity in the rates of high school completion between
students at risk of dropping out of school, as defined by Section
29.081, and all other students. Specifically, the funds, other
than an indirect cost allotment established under State Board of
Education rule, which may not exceed 15 percent, may be used to meet
the costs of providing a compensatory, intensive, or accelerated
instruction program under Section 29.081 or a disciplinary
alternative education program established under Section 37.008 or
to support a program eligible under Title I of the Elementary and
Secondary Education Act of 1965, as provided by Pub. L. No. 103-382,
and by federal regulations implementing that Act, at a campus at
which at least 40 percent of the students are educationally
disadvantaged. In meeting the costs of providing a compensatory,
intensive, or accelerated instruction program under Section
29.081, a district's compensatory education allotment shall be used
for costs supplementary to the regular education program, such as
costs for program and student evaluation, instructional materials
and equipment and other supplies required for quality instruction,
supplemental staff expenses, salary for teachers of at-risk
students, smaller class size, and individualized instruction. A
home-rule school district or an open-enrollment charter school must
use funds allocated under Section 42.054 for a purpose authorized
by this subsection but is not otherwise subject to Subchapter C,
Chapter 29. Notwithstanding any other provision of this section:
(1) to ensure that a sufficient amount of the funds
allotted under this section are available to supplement
instructional programs and services, not more than 18 percent of
the funds allocated under Section 42.054 may be used to fund
disciplinary alternative education programs established under
Section 37.008;
(2) the commissioner may waive the limitations of
Subdivision (1) on an annual petition, by a district's board of
trustees and the district's district-level committee established
under Subchapter F, Chapter 11, presenting the reason for the need
to spend supplemental compensatory education funds on disciplinary
alternative education programs under Section 37.008;
(3) for purposes of this subsection, a program
specifically designed to serve students at risk of dropping out of
school, as defined by Section 29.081, is considered to be a program
supplemental to the regular education program, and a district may
use its compensatory education allotment for such a program;
(4) funds allocated under Section 42.054 may be used
to fund in proportion to the percentage of students served by the
program that meet the criteria in Section 29.081(d) or (g):
(A) an accelerated reading instruction program
under Section 28.006(g); or
(B) a program for treatment of students who have
dyslexia or a related disorder as required by Section 38.003; and
(5) funds allocated under Section 42.054 may be used
to fund a district's mentoring services program under Section
29.089, as added by Chapter 783, Acts of the 78th Legislature,
Regular Session, 2003.
(b) In a petition under Subsection (a)(2), a district shall
report the number of students in each grade level, by demographic
subgroup, not making satisfactory progress under the state's
assessment system. The commissioner shall make this waiver request
information available annually to the public on the agency's
website.
(c) The agency shall evaluate the effectiveness of
accelerated instruction and support programs provided under
Section 29.081 for students at risk of dropping out of school.
(d) From the total amount of funds appropriated for
allocations under Section 42.054, the commissioner may, each fiscal
year:
(1) withhold an amount determined by the commissioner
as appropriate to finance activities under Section 39.024(d); and
(2) withhold an amount not exceeding $1 million each
fiscal year and distribute the funds to school districts that incur
unanticipated expenditures resulting from a significant increase
in the enrollment of students who do not have disabilities and who
reside in residential placement facilities.
(e) From the total amount of funds appropriated for
allocations under Section 42.054, the commissioner shall, each
fiscal year:
(1) withhold an amount determined by the commissioner
as appropriate to finance activities under Section 39.024(c);
(2) withhold an amount to be determined by the
commissioner, but not less than $10 million, and distribute that
amount for programs under Section 29.085, giving preference to a
school district that received funds for a program under that
section for the preceding school year;
(3) withhold the amount of $7.5 million, or a greater
amount as determined in the General Appropriations Act, and
distribute that amount for programs under Subchapter A, Chapter 33,
giving preference to a school district that received funds for a
program under that subchapter for the preceding school year;
(4) withhold the amount of $2.5 million for transfer
to the investment capital fund under Section 7.024; and
(5) withhold an amount sufficient to finance extended
year programs under Section 29.082, not to exceed five percent of
the amounts allocated under Section 42.054, giving preference to
extended year programs in districts with high concentrations of
educationally disadvantaged students.
(f) After deducting the amounts withheld under Subsections
(d) and (e) from the total amount appropriated for the allocations
under Section 42.054, the commissioner shall reduce each district's
guaranteed amount proportionately.
Sec. 42.454. REPORTING AND AUDITING OF COMPENSATORY
EDUCATION EXPENDITURES. (a) The State Board of Education, with the
assistance of the comptroller, shall develop and implement by rule
reporting and auditing systems for district and campus expenditures
of compensatory education funds to ensure that compensatory
education funds, other than the indirect cost allotment, are spent
only to supplement the regular education program as required by
Section 42.453(a). The reporting requirements shall be managed
electronically to minimize local administrative costs. A district
shall submit the report required by this subsection not later than
the 150th day after the last day permissible for resubmission of
information required under Section 7.007.
(b) The commissioner shall develop a system to identify
school districts that are at high risk of having used compensatory
education funds other than in compliance with Section 42.453(a) or
of having inadequately reported compensatory education
expenditures. If a review of the report submitted under Subsection
(a), using the risk-based system, indicates that a district is not
at high risk of having misused compensatory education funds or of
having inadequately reported compensatory education expenditures,
the district may not be required to perform a local audit of
compensatory education expenditures and is not subject to on-site
monitoring under this section.
(c) If a review of the report submitted under Subsection
(a), using the risk-based system, indicates that a district is at
high risk of having misused compensatory education funds, the
commissioner shall notify the district of that determination. The
district must respond to the commissioner not later than the 30th
day after the date the commissioner notifies the district of the
commissioner's determination. If the district's response does not
change the commissioner's determination that the district is at
high risk of having misused compensatory education funds or if the
district does not respond in a timely manner, the commissioner
shall:
(1) require the district to conduct a local audit of
compensatory education expenditures for the current or preceding
school year;
(2) order agency staff to conduct on-site monitoring
of the district's compensatory education expenditures; or
(3) both require a local audit and order on-site
monitoring.
(d) If a review of the report submitted under Subsection
(a), using the risk-based system, indicates that a district is at
high risk of having inadequately reported compensatory education
expenditures, the commissioner may require agency staff to assist
the district in following the proper reporting methods or amending
a district or campus improvement plan under Subchapter F, Chapter
11. If the district does not take appropriate corrective action
before the 45th day after the date the agency staff notifies the
district of the action the district is expected to take, the
commissioner may:
(1) require the district to conduct a local audit of
the district's compensatory education expenditures; or
(2) order agency staff to conduct on-site monitoring
of the district's compensatory education expenditures.
(e) The commissioner, in the year following a local audit of
compensatory education expenditures, shall withhold from a
district's foundation school fund payment an amount equal to the
amount of compensatory education funds the agency determines were
not used in compliance with Section 42.453(a). The commissioner
shall release to a district funds withheld under this subsection
when the district provides to the commissioner a detailed plan to
spend those funds in compliance with Section 42.453(a).
(f) The commissioner shall grant a one-year exemption from
the requirements of Subsections (a)-(e) to a school district in
which the group of students who have failed to perform
satisfactorily in the preceding school year on an assessment
instrument required under Section 39.023(a), (c), or (l)
subsequently performs on those assessment instruments at a level
that meets or exceeds a level prescribed by commissioner rule. Each
year the commissioner, based on the most recent information
available, shall determine if a school district is entitled to an
exemption for the following school year and notify the district of
that determination.
Sec. 42.455. PROGRAMS FOR GIFTED AND TALENTED STUDENTS.
(a) Funds allocated under Section 42.055, as adjusted under
Sections 42.081 and 42.082, other than the amount that represents
the program's share of general administrative costs, must be used
in providing programs for gifted and talented students under
Subchapter D, Chapter 29, including programs sanctioned by
International Baccalaureate and Advanced Placement, or in
developing programs for gifted and talented students. Each
district must account for the expenditure of state funds as
provided by State Board of Education rule. If by the end of the 12th
month after receiving an allocation for developing a program a
district has failed to implement a program, the district must
refund the amount of the allocation to the agency within 30 days.
(b) After each district has received allocated funds for
programs for gifted and talented students, the State Board of
Education may use up to $500,000 of the funds allocated under
Section 42.055 for programs such as MATHCOUNTS, Future Problem
Solving, Odyssey of the Mind, and Academic Decathlon, as long as
those funds are used to train personnel and provide program
services. To be eligible for funding under this subsection, a
program must be determined by the State Board of Education to
provide services that are effective and consistent with the state
plan for gifted and talented education.
Sec. 42.456. CAREER AND TECHNOLOGY EDUCATION PROGRAMS. (a)
Funds allocated under Section 42.056, as adjusted under Sections
42.081 and 42.082, other than an indirect cost allotment
established under State Board of Education rule, must be used in
providing career and technology education programs in grades 9
through 12 or career and technology education programs for students
with disabilities in grades 7 through 12 under Sections 29.182,
29.183, and 29.184.
(b) Out of the total amount appropriated for allocations for
career and technology education under Section 42.056, the
commissioner may withhold an amount specified in the General
Appropriations Act, which may not exceed one percent of the total
amount appropriated, to support regional career and technology
education planning. After deducting the amount withheld under this
subsection from the total amount appropriated for allocations for
career and technology education under Section 42.056, the
commissioner shall reduce each district's allocations under that
section proportionately.
(c) The commissioner shall conduct a cost-benefit
comparison between career and technology education programs and
mathematics and science programs.
ARTICLE 2. [RESERVED]
ARTICLE 3. STATE PROPERTY TAX
SECTION 3.01. Chapter 45, Education Code, is amended by
adding Subchapter I to read as follows:
SUBCHAPTER I. STATE AD VALOREM TAX
Sec. 45.251. STATE AD VALOREM TAX. (a) A state ad valorem
tax for elementary and secondary public school purposes is imposed
on all taxable property in this state.
(b) The tax is imposed at the rate of $1 per $100 of taxable
value of property subject to the tax.
(c) Except as otherwise provided by law, the state shall be
treated, for purposes of the state ad valorem tax, as a taxing unit
under Title 1, Tax Code.
Sec. 45.252. APPRAISAL OF PROPERTY. (a) Property subject
to the state ad valorem tax shall be appraised by the appraisal
district for the county in which the property has taxable situs
under Chapter 21, Tax Code.
(b) Property subject to the state ad valorem tax shall be
appraised in the manner provided by Title 1, Tax Code, for the
appraisal of property that is subject to ad valorem taxation by a
county.
Sec. 45.253. TAX COLLECTION. (a) In each county, the
assessor-collector for the county shall assess and collect state ad
valorem taxes imposed on property included on the appraisal roll
for state taxation certified to the county tax assessor-collector
under Section 26.01, Tax Code, unless the commissioners court of
the county contracts with an official, taxing unit, or political
subdivision of this state for the assessment or collection of the ad
valorem taxes of the county, in which event the official, taxing
unit, or political subdivision shall also assess or collect, as
applicable, the state ad valorem taxes.
(b) Each assessor or collector of state ad valorem taxes is
entitled to be reimbursed by the comptroller for the actual costs
incurred by the assessor or collector in assessing or collecting
state ad valorem taxes. However, an assessor or collector is not
entitled to be reimbursed for any amount that is greater than the
additional incremental costs incurred in assessing or collecting
the state ad valorem taxes.
(c) The comptroller shall:
(1) prescribe methods of accounting for and remitting
state ad valorem taxes;
(2) prescribe methods for establishing an assessor's
or collector's additional incremental costs incurred in assessing
or collecting state ad valorem taxes;
(3) prescribe and furnish forms for periodic reports
relating to state ad valorem taxes; and
(4) periodically examine the records of each assessor
or collector of state ad valorem taxes to verify the accuracy of any
reports required under this subsection.
(d) The comptroller may require an assessor or collector of
state ad valorem taxes to give a bond to the state, conditioned on
the faithful performance of the person's duties as assessor or
collector, and may require a county assessor-collector to increase
the bond for state taxes given under Section 6.28, Tax Code, in the
amount the comptroller considers appropriate to protect the state
from potential losses with regard to collection of state ad valorem
taxes.
Sec. 45.254. DUTIES AND POWERS OF COMPTROLLER. (a) Except
as otherwise provided by this subchapter, a duty imposed on or power
granted to the governing body of a taxing unit by Title 1, Tax Code,
may, for purposes of the state ad valorem tax under this subchapter,
be exercised by the comptroller. A reference to the presiding
officer of a governing body in Title 1, Tax Code, is a reference to
the comptroller for the purposes of the state tax under this
subchapter.
(b) The comptroller may delegate to the county
assessor-collector any function of the comptroller with respect to
the state ad valorem tax and may designate the county
assessor-collector as the comptroller's agent for purposes of
administration of the state ad valorem tax.
Sec. 45.255. ADMINISTRATION AND REFUND ACCOUNTS. The
comptroller shall deposit to the credit of the general revenue fund
in appropriately designated accounts an amount of revenue collected
from the state ad valorem tax to pay for the comptroller's expenses
in administering this subchapter and for the payment of tax refunds
that may become payable.
Sec. 45.256. NONAPPLICABILITY OF CERTAIN OTHER TAX LAWS.
Title 2, Tax Code, does not apply to the state ad valorem tax under
this subchapter.
Sec. 45.257. TAX INCREMENT FINANCING. (a) Except as
otherwise provided by this section, the state may not pay any
portion of the tax increment produced by the state into the tax
increment fund for a reinvestment zone designated under Chapter
311, Tax Code.
(b) If a reinvestment zone was designated under Chapter 311,
Tax Code, before January 1, 2006, and a school district entered into
an agreement with the governing body of the municipality that
created the zone to pay into the tax increment fund for the zone any
portion of the school district's tax increment produced from
property located in the zone, the portion of the tax increment
produced by the school district that must be paid into the tax
increment fund shall be determined as provided by this subsection,
notwithstanding the terms of the agreement, and the state shall pay
a portion of the tax increment produced by the state into the tax
increment fund as determined by this subsection. The collector for
the municipality shall calculate the portion of the total amount of
tax increment produced by the school district and the state that the
school district would be required to pay into the tax increment fund
under the agreement if that total amount of tax increment were
produced solely by the school district. That amount shall be
apportioned between the school district and the state in proportion
to the amount of tax increment produced by each of those entities,
and each entity shall pay the amount apportioned to it into the tax
increment fund.
(c) If the reinvestment zone was designated under Chapter
311, Tax Code, before this subchapter took effect, the tax
increment base of the state is calculated under Section 311.012,
Tax Code, as if this subchapter were in effect for the year in which
the zone was designated.
(d) If the reinvestment zone includes property taxable by
more than one school district, the amount of tax increment required
to be paid into the tax increment fund by each school district and
the state shall be calculated as provided by Subsection (b)
separately for the portion of the reinvestment zone located in each
school district.
Sec. 45.258. TAX ABATEMENT. (a) Except as otherwise
provided by this section, the state may not participate in tax
abatement under Section 311.0125 or 311.013(g) or Chapter 312, Tax
Code.
(b) If school district property taxes on property located in
the taxing jurisdiction of a school district are abated under a tax
abatement agreement entered into by the school district under
Chapter 312, Tax Code, the terms of the agreement regarding the
portion of the value of the property that is to be exempted from
taxation in each year of the agreement apply to the taxation of the
property by the state. A modification of the agreement by the
parties to the agreement under Section 312.208, Tax Code, that
increases the portion of the value of the property that is to be
exempted from taxation or that extends the duration of the
agreement does not apply to the taxation of the property by the
state unless the modification is entered into before January 1,
2006.
Sec. 45.259. LIMITATION ON APPRAISED VALUE OF CERTAIN
PROPERTY FOR STATE TAXATION. This section applies only in
connection with property for which before January 1, 2006, the
governing body of a school district has entered into a written
agreement with a property owner under Section 313.027, Tax Code,
for the implementation of a limitation on appraised value under
Subchapter B or C, Chapter 313, Tax Code. In each tax year in which
the appraised value of the property is subject to the limitation,
the appraised value of the property for purposes of the taxation of
the property by the state is the same as the appraised value of the
property for school district tax purposes.
SECTION 3.02. Subchapter A, Chapter 6, Tax Code, is amended
by adding Section 6.038 to read as follows:
Sec. 6.038. STATE PARTICIPATION. (a) The comptroller and
the state do not participate in the election of the board of
directors of an appraisal district, the governance or management of
the district, or the determination of the district's finances and
budget.
(b) The comptroller by rule shall establish guidelines and
criteria under which, if the comptroller finds that generally
accepted appraisal standards and practices were not used by the
appraisal district appraising property subject to the state ad
valorem tax or that the appraised values assigned to property
subject to that tax are invalid, the comptroller may:
(1) withhold payment of all or part of the portion of
the amount of the budget of the appraisal district that is allocated
to the state until the district takes appropriate actions to remedy
the deficiencies in appraisals found by the comptroller; or
(2) direct that all or any part of the portion of the
amount of the budget of the district allocated to the state be
applied to remedying those deficiencies.
SECTION 3.03. Section 6.06(d), Tax Code, is amended to read
as follows:
(d) The state and each [Each] taxing unit participating in
the district are each [is] allocated a portion of the amount of the
budget equal to the proportion that the total dollar amount of
property taxes imposed in the district by the state or taxing unit
for the tax year in which the budget proposal is prepared bears to
the sum of the total dollar amount of property taxes imposed in the
district by the state and each participating unit for that year.
For purposes of this subsection, only state ad valorem taxes
imposed in the county for which the district is established are
considered as state ad valorem taxes imposed in the district. If a
taxing unit participates in two or more districts, only the taxes
imposed in a district are used to calculate the unit's cost
allocations in that district. If the number of real property
parcels in a taxing unit is less than 5 percent of the total number
of real property parcels in the district and the taxing unit imposes
in excess of 25 percent of the total amount of the property taxes
imposed in the district by all of the participating taxing units for
a year, the unit's allocation may not exceed a percentage of the
appraisal district's budget equal to three times the unit's
percentage of the total number of real property parcels appraised
by the district.
SECTION 3.04. Sections 11.13(b) and (c), Tax Code, are
amended to read as follows:
(b) An adult is entitled to exemption from taxation by the
state for elementary and secondary public school purposes or by a
school district of $15,000 of the appraised value of the adult's
residence homestead, except that $10,000 of the exemption 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.
(c) In addition to the exemption provided by Subsection (b)
[of this section], an adult who is disabled or is 65 years of age or
older is entitled to an exemption from taxation by the state for
elementary and secondary public school purposes or by a school
district of $10,000 of the appraised value of the adult's [his]
residence homestead.
SECTION 3.05. Section 11.14, Tax Code, is amended by adding
Subsection (f) to read as follows:
(f) Subsection (c) does not apply to the comptroller or to
the state ad valorem tax.
SECTION 3.06. Section 11.251(i), Tax Code, is amended to
read as follows:
(i) The exemption provided by Subsection (b) does not apply
to a taxing unit that takes action to tax the property under Article
VIII, Section 1-j, Subsection (b), of the Texas Constitution. If
the property is located in a school district for which the property
is not exempt from taxation in the tax year, the property is not
exempt from state ad valorem taxes imposed under Section 3-a,
Article VII, Texas Constitution, in that tax year.
SECTION 3.07. The heading to Section 11.26, Tax Code, is
amended to read as follows:
Sec. 11.26. LIMITATION OF SCHOOL TAXES [TAX] ON HOMESTEADS
OF ELDERLY OR DISABLED.
SECTION 3.08. Section 11.26, Tax Code, is amended by
amending Subsections (a), (b), (g), (h), (j), and (k) and adding
Subsections (a-1) and (g-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. The state or
a [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 state or school
district taxes imposed on the residence homestead in the next year
are less than the amount of taxes the state or school district, as
applicable, imposed in that first year, the state or [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).
(a-1) 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 was a tax year before the
2006 [1997] tax year, except as provided by Subsection (b):
(1) the amount of the limitation provided by this
section on state taxes is the amount of tax the school district in
which the property is located imposed for the 2005 [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 2006 state [1997] tax attributable to improvements
made in 2005 [1996], other than improvements made to comply with
governmental regulations or repairs; and
(2) the amount of the limitation provided by this
section on school district taxes is the amount of tax the school
district imposed for the 2005 tax year less the amount of state
taxes imposed in the 2006 tax year, plus any 2006 school taxes
attributable to improvements made in 2005, other than improvements
made to comply with governmental regulations or repairs.
(b) If an individual makes improvements to the individual's
residence homestead, other than improvements required to comply
with governmental requirements or repairs, the state or 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 imposed by this section then applies to
the increased amount of tax until more improvements, if any, are
made.
(g) Except as provided by Subsection (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 (i), subsequently qualifies a different residence
homestead for the same exemption under Section 11.13, the state or a
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 state or the school district would have imposed on the
subsequently qualified homestead in the first year in which the
individual receives that same 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 the state or the school district, as applicable, on the
former homestead in the last year in which the individual received
that same exemption for the former homestead and the denominator of
which is the total amount of taxes the state or the school district,
as applicable, [taxes that] would have [been] imposed on the former
homestead in the last year in which the individual received that
same exemption for the former homestead had the limitation on tax
increases imposed by this section not been in effect.
(g-1) Subsection (g) does not apply to a residence homestead
to which this subsection applies. Except as provided by Subsection
(b), if an individual who receives a limitation on tax increases
imposed by this section in a tax year before the 2006 tax year,
including a surviving spouse who receives a limitation under
Subsection (i), subsequently qualifies a different residence
homestead for an exemption under Section 11.13(c) and the first
year in which the subsequently qualified homestead qualifies for
the exemption is a tax year after the 2005 tax year:
(1) the state may not impose taxes on the subsequently
qualified homestead in an amount that exceeds the amount of taxes
the state would have imposed on the subsequently qualified
homestead in the first year in which the individual receives 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 on the former homestead in
the last year in which the individual received that exemption for
the former homestead and the denominator of which is the total
amount of school district taxes that would have been imposed on the
former homestead in the last year in which the individual received
that exemption for the former homestead had the limitations on tax
increases imposed by this section not been in effect; and
(2) the school district may not impose taxes on the
subsequently qualified homestead in an amount that exceeds the
positive amount, if any, by which the limitation on state taxes
calculated under Subdivision (1) exceeds the amount of state taxes
imposed in the first year in which the subsequently qualified
homestead receives the exemption.
(h) An individual who receives a limitation on tax increases
under this section, including a surviving spouse who receives a
limitation under Subsection (i), and who subsequently qualifies a
different residence homestead for an exemption under Section
11.13(c) [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 that same limitation on the subsequently qualified
homestead under Subsection (g) or (g-1) and to calculate the amount
of taxes the state and the school district may impose on the
subsequently qualified homestead.
(j) If an individual who qualifies for an exemption provided
by Section 11.13(c) 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
(k), the amount to which the surviving spouse's state or school
district taxes are limited under Subsection (i) is the amount of
state or school district taxes, as applicable, imposed on the
residence homestead in that year determined as if the individual
qualifying for the exemption had lived for the entire year.
(k) If in the first tax year after the year in which an
individual dies in the circumstances described by Subsection (j)
the amount of [school district] taxes imposed by the state or the
school district on the residence homestead of the surviving spouse
is less than the amount of state or school district taxes, as
applicable, imposed in the preceding year as limited by Subsection
(j), in a subsequent tax year the surviving spouse's state or school
district taxes on that residence homestead are limited to the
amount of taxes imposed by the state or the school district, as
applicable, in that first tax year after the year in which the
individual dies.
SECTION 3.09. Section 21.03(a), Tax Code, is amended to
read as follows:
(a) If personal property that is taxable by this state or a
taxing unit of this state is used continually outside this state,
whether regularly or irregularly, the appraisal office shall
allocate to this state the portion of the total market value of the
property that fairly reflects its use in this state.
SECTION 3.10. Section 21.031(a), Tax Code, is amended to
read as follows:
(a) If a vessel or other watercraft that is taxable by this
state or a taxing unit of this state is used continually outside
this state, whether regularly or irregularly, the appraisal office
shall allocate to this state the portion of the total market value
of the vessel or watercraft that fairly reflects its use in this
state. The appraisal office shall not allocate to this state the
portion of the total market value of the vessel or watercraft that
fairly reflects its use in another state or country, in
international waters, or beyond the Gulfward boundary of this
state.
SECTION 3.11. Section 22.28, Tax Code, is amended to read as
follows:
Sec. 22.28. PENALTY FOR DELINQUENT REPORT. (a) Except as
otherwise provided by Section 22.30, the chief appraiser shall
impose a penalty on a person who fails to timely file a rendition
statement or property report required by this chapter in an amount
equal to 10 percent of the total amount of taxes imposed on the
property for that year by the state, if the property has taxable
situs in the county for which the appraisal district is
established, and by the other taxing units participating in the
appraisal district.
(b) The chief appraiser may retain a portion of a penalty
collected under this section, not to exceed 20 percent of the amount
of the penalty, to cover the chief appraiser's costs of collecting
the penalty. The chief appraiser shall distribute the remainder of
the penalty to the state and each taxing unit participating in the
appraisal district that imposes taxes on the property in proportion
to the state's or the taxing unit's share of the total amount of
taxes imposed on the property by the state and all other taxing
units participating in the district used to determine the amount of
the penalty.
SECTION 3.12. Sections 22.29(a) and (d), Tax Code, are
amended to read as follows:
(a) The chief appraiser shall impose an additional penalty
on the person equal to 50 percent of the total amount of taxes
imposed on the property for the tax year of the statement or report
by the state, if the property has taxable situs in the county for
which the appraisal district is established, and by the other
taxing units participating in the appraisal district if it is
finally determined by a court that:
(1) the person filed a false statement or report with
the intent to commit fraud or to evade the tax; or
(2) the person alters, destroys, or conceals any
record, document, or thing, or presents to the chief appraiser any
altered or fraudulent record, document, or thing, or otherwise
engages in fraudulent conduct, for the purpose of affecting the
course or outcome of an inspection, investigation, determination,
or other proceeding before the appraisal district.
(d) The chief appraiser may retain a portion of a penalty
collected under this section, not to exceed 20 percent of the amount
of the penalty, to cover the chief appraiser's costs of collecting
the penalty. The chief appraiser shall distribute the remainder of
the penalty to the state and each taxing unit participating in the
appraisal district that imposes taxes on the property in proportion
to the state's or the taxing unit's share of the total amount of
taxes imposed on the property by the state and all other taxing
units participating in the district used to determine the amount of
the penalty.
SECTION 3.13. Section 23.46(d), Tax Code, is amended to
read as follows:
(d) A tax lien attaches to the land on the date the sale or
change of use occurs to secure payment of the additional tax and
interest imposed by Subsection (c) [of this section] and any
penalties incurred. The lien exists in favor of the state and all
taxing units for which the additional tax is imposed.
SECTION 3.14. Section 23.55(b), Tax Code, is amended to
read as follows:
(b) A tax lien attaches to the land on the date the change of
use occurs to secure payment of the additional tax and interest
imposed by this section and any penalties incurred. The lien exists
in favor of the state and all taxing units for which the additional
tax is imposed.
SECTION 3.15. Section 23.76(b), Tax Code, is amended to
read as follows:
(b) A tax lien attaches to the land on the date the change of
use occurs to secure payment of the additional tax and interest
imposed by this section and any penalties incurred. The lien exists
in favor of the state and all taxing units for which the additional
tax is imposed.
SECTION 3.16. Section 23.86(b), Tax Code, is amended to
read as follows:
(b) A tax lien attaches to the land on the date the change of
use occurs or the deed restriction expires to secure payment of the
additional tax and interest imposed by this section and any
penalties incurred. The lien exists in favor of the state and all
taxing units for which the additional tax is imposed.
SECTION 3.17. Section 23.96(b), Tax Code, is amended to
read as follows:
(b) A tax lien attaches to the property on the date the deed
restriction expires to secure payment of the additional tax and
interest imposed by this section and any penalties incurred. The
lien exists in favor of the state and all taxing units for which the
additional tax is imposed.
SECTION 3.18. Section 23.9807(c), Tax Code, is amended to
read as follows:
(c) A tax lien attaches to the land on the date the change of
use occurs to secure payment of the additional tax and interest
imposed by this section and any penalties incurred. The lien exists
in favor of the state and all taxing units for which the additional
tax is imposed.
SECTION 3.19. Section 25.19(b), Tax Code, as amended by
Chapters 1358 and 1517, Acts of the 76th Legislature, Regular
Session, 1999, is reenacted and amended to read as follows:
(b) The chief appraiser shall separate real from personal
property and include in the notice for each:
(1) a list of the taxing units other than the state in
which the property is taxable and, if the property is appraised by
the appraisal district for state taxation, a statement that the
property is subject to the state tax for elementary and secondary
public school purposes;
(2) the appraised value of the property in the
preceding year;
(3) the taxable value of the property in the preceding
year for:
(A) each taxing unit taxing the property; and
(B) state taxation for elementary and secondary
public school purposes, if the property is appraised by the
appraisal district for state taxation;
(4) the appraised value of the property for the
current year and the kind and amount of each partial exemption, if
any, approved for the current year;
(5) if the appraised value is greater than it was in
the preceding year, the amount of tax that would be imposed on the
property on the basis of the tax rate for each taxing unit other
than the state for the preceding year;
(6) in italic typeface, the following statement: "The
Texas Legislature does not set the amount of your local taxes. Your
local property tax burden is decided by your locally elected
officials, and all inquiries concerning your local taxes should be
directed to those officials";
(7) a detailed explanation of the time and procedure
for protesting the value;
(8) the date and place the appraisal review board will
begin hearing protests; and
(9) a brief explanation that the governing body of
each local taxing unit decides whether [or not] taxes on the
property will increase and the appraisal district only determines
the value of the property.
SECTION 3.20. The heading to Section 26.01, Tax Code, is
amended to read as follows:
Sec. 26.01. SUBMISSION OF ROLLS TO STATE AND TAXING UNITS.
SECTION 3.21. Sections 26.01(a), (c), and (d), Tax Code,
are amended to read as follows:
(a) By July 25, the chief appraiser shall prepare and
certify to the assessor for each taxing unit participating in the
district that part of the appraisal roll for the district that lists
the property taxable by the unit. By that date the chief appraiser
shall prepare and certify to the comptroller that part of the
appraisal roll for the district that lists property taxable by the
state in the county for which the appraisal district is
established. The part certified to the assessor or the comptroller
is the appraisal roll for the taxing unit or the state. The chief
appraiser shall consult with the assessor for each taxing unit and
the comptroller and notify each taxing unit and the comptroller in
writing by April 1 of the form in which the roll will be provided to
each unit and to the comptroller.
(c) The chief appraiser shall prepare and certify to the
assessor for each taxing unit and the comptroller a listing of those
properties that [which] are taxable by that unit or the state, as
applicable, but that [which] are under protest and therefore not
included on the appraisal roll approved by the appraisal review
board and certified by the chief appraiser. This listing shall
include the appraised market value, productivity value (if
applicable), and taxable value as determined by the appraisal
district and shall also include the market value, taxable value,
and productivity value (if applicable) as claimed by the property
owner filing the protest if available. If the property owner does
not claim a value and the appraised value of the property in the
current year is equal to or less than its value in the preceding
year, the listing shall include a reasonable estimate of the market
value, taxable value, and productivity value (if applicable) that
would be assigned to the property if the taxpayer's claim is upheld.
If the property owner does not claim a value and the appraised value
of the property is higher than its appraised value in the preceding
year, the listing shall include the appraised market value,
productivity value (if applicable) and taxable value of the
property in the preceding year, except that if there is a reasonable
likelihood that the appraisal review board will approve a lower
appraised value for the property than its appraised value in the
preceding year, the chief appraiser shall make a reasonable
estimate of the taxable value that would be assigned to the property
if the property owner's claim is upheld. The taxing unit shall use
the lower value for calculations as prescribed in Sections 26.04
and 26.041 [of this code].
(d) The chief appraiser shall prepare and certify to the
assessor for each taxing unit and the comptroller a list of those
properties of which the chief appraiser has knowledge that are
reasonably likely to be taxable by that unit or the state, as
applicable, but that are not included on the appraisal roll
certified to the assessor or the comptroller under Subsection (a)
or included on the listing certified to the assessor or the
comptroller under Subsection (c). The chief appraiser shall
include on the list for each property the market value, appraised
value, and kind and amount of any partial exemptions as determined
by the appraisal district for the preceding year and a reasonable
estimate of the market value, appraised value, and kind and amount
of any partial exemptions for the current year. Until the
property is added to the appraisal roll, the assessor for the taxing
unit shall include each property on the list in the calculations
prescribed by Sections 26.04 and 26.041, and for that purpose shall
use the lower market value, appraised value, or taxable value, as
appropriate, included on or computed using the information included
on the list for the property.
SECTION 3.22. The heading to Section 26.08, Tax Code, is
amended to read as follows:
Sec. 26.08. MAXIMUM SCHOOL DISTRICT TAX RATE [ELECTION TO
RATIFY SCHOOL TAXES].
SECTION 3.23. Section 26.08(a), Tax Code, is amended to read
as follows:
(a) The [If the] governing body of a school district may not
adopt [adopts] a tax rate that exceeds the sum of the district's
current enrichment tax rate under Subchapter E, Chapter 42,
Education Code, and the district's current debt rate. [rollback tax
rate, the registered voters of the district at an election held for
that purpose must determine whether to approve the adopted tax
rate. When increased expenditure of money by a school district is
necessary to respond to a disaster, including a tornado, hurricane,
flood, or other calamity, but not including a drought, that has
impacted a school district and the governor has requested federal
disaster assistance for the area in which the school district is
located, an election is not required under this section to approve
the tax rate adopted by the governing body for the year following
the year in which the disaster occurs.]
SECTION 3.24. Chapter 26, Tax Code, is amended by adding
Section 26.011 to read as follows:
Sec. 26.011. PROVISIONS NOT APPLICABLE TO STATE TAX.
Sections 26.04, 26.041, 26.05, 26.051, 26.06, 26.07, and 26.08 do
not apply to the state ad valorem tax or to the comptroller.
SECTION 3.25. Section 26.09(c), Tax Code, is amended to
read as follows:
(c) The tax is calculated by:
(1) subtracting from the appraised value of a property
as shown on the appraisal roll for a taxing [the] unit or the state
the amount of any partial exemption allowed the property owner that
applies to appraised value to determine taxable [net appraised]
value; and
(2) [multiplying the net appraised value by the
assessment ratio to determine assessed value;
[(3) subtracting from the assessed value the amount of
any partial exemption allowed the property owner to determine
taxable value; and
[(4)] multiplying the taxable value by the applicable
tax rate.
SECTION 3.26. Section 26.12, Tax Code, is amended by adding
Subsection (e) to read as follows:
(e) For purposes of this section, the state is not a taxing
unit.
SECTION 3.27. Section 26.15(c), Tax Code, is amended to
read as follows:
(c) At any time, the governing body of a taxing unit, on
motion of the assessor for the unit or of a property owner, shall
direct by written order changes in the tax roll to correct errors in
the mathematical computation of a tax. The assessor shall enter the
corrections ordered by the governing body. The comptroller may
order changes in the state tax roll to correct errors in the
mathematical computation of the state ad valorem tax.
SECTION 3.28. Section 31.11(a), Tax Code, is amended to
read as follows:
(a) If a taxpayer applies to the tax collector of a taxing
unit for a refund of an overpayment or erroneous payment of taxes
and the auditor for the unit or the comptroller in the case of the
state ad valorem tax determines that the payment was erroneous or
excessive, the tax collector shall refund the amount of the
excessive or erroneous payment from available current tax
collections or from funds appropriated by the unit for making
refunds. For taxes other than state ad valorem taxes [However], the
collector may not make the refund unless:
(1) in the case of a collector who collects taxes for
one taxing unit, the governing body of the taxing unit also
determines that the payment was erroneous or excessive and approves
the refund if the amount of the refund exceeds:
(A) $2,500 for a refund to be paid by a county
with a population of 1.5 million or more; or
(B) $500 for a refund to be paid by any other
taxing unit; or
(2) in the case of a collector who collects taxes for
more than one taxing unit, the governing body of the taxing unit
that employs the collector also determines that the payment was
erroneous or excessive and approves the refund if the amount of the
refund exceeds $2,500.
SECTION 3.29. Sections 32.01(a) and (d), Tax Code, are
amended to read as follows:
(a) On January 1 of each year, a tax lien attaches to
property to secure the payment of all taxes, penalties, and
interest ultimately imposed for the year by the state or a taxing
unit on the property, whether or not the taxes are imposed in the
year the lien attaches. The lien to secure the payment of state ad
valorem taxes and applicable penalties and interest exists in favor
of the state. The lien to secure the payment of taxes imposed by a
taxing unit and applicable penalties and interest exists in favor
of the [each] taxing unit having power to tax the property.
(d) The lien under this section is perfected on attachment
and, except as provided by Section 32.03(b), perfection requires no
further action by the state or taxing unit.
SECTION 3.30. Section 33.01(a), Tax Code, is amended to
read as follows:
(a) A delinquent tax, including a delinquent state ad
valorem tax, incurs a penalty of six percent of the amount of the
tax for the first calendar month it is delinquent plus one percent
for each additional month or portion of a month the tax remains
unpaid prior to July 1 of the year in which it becomes delinquent.
However, a tax delinquent on July 1 incurs a total penalty of twelve
percent of the amount of the delinquent tax without regard to the
number of months the tax has been delinquent. A delinquent tax
continues to incur the penalty provided by this subsection as long
as the tax remains unpaid, regardless of whether a judgment for the
delinquent tax has been rendered.
SECTION 3.31. Subchapter A, Chapter 33, Tax Code, is
amended by adding Section 33.11 to read as follows:
Sec. 33.11. COLLECTION OF DELINQUENT STATE AD VALOREM
TAXES; PENALTY. (a) Except as provided by Subsection (b), the
attorney general shall represent the state to enforce the
collection of delinquent state ad valorem taxes. The attorney
general may delegate the attorney general's duties under this
subsection to a county or district attorney or may contract with a
private attorney for the performance of those duties.
(b) If the commissioners court of a county contracts with a
private attorney for the collection of delinquent county ad valorem
taxes, the contract applies to the collection of delinquent state
ad valorem taxes on property taxable in that county without further
action. The compensation of the private attorney for collecting
delinquent state ad valorem taxes is equal to a percentage of the
amount collected that represents the portion of that amount
attributable to the additional penalty provided by Subsection (c).
If the commissioners court of a county contracts with an official,
taxing unit, or political subdivision of this state for the
collection of the ad valorem taxes of the county that includes the
collection of delinquent county taxes, the contract applies to the
collection of delinquent state ad valorem taxes on property taxable
in that county without further action.
(c) State ad valorem taxes that remain delinquent on July 1
of the year in which they become delinquent incur an additional
penalty to defray costs of collection if the collection of the
delinquent taxes is covered by a contract with a private attorney
under Subsection (a) or (b). The amount of the penalty is 15
percent of the amount of the taxes, penalty, and interest due.
(d) A tax lien attaches in favor of the state to the property
on which the tax is imposed to secure payment of the penalty.
(e) The attorney general or the person responsible for
collecting the delinquent tax shall deliver a notice of delinquency
and of the penalty to the property owner at least 30 and not more
than 60 days before July 1.
(f) Sections 6.30, 33.07, and 33.08 do not apply to the
state ad valorem tax.
SECTION 3.32. Sections 33.21(a) and (b), Tax Code, are
amended to read as follows:
(a) A person's personal property is subject to seizure for
the payment of a delinquent tax, penalty, and interest the person
[he] owes the state or a taxing unit on property.
(b) A person's personal property is subject to seizure for
the payment of a tax imposed by the state or other [a] taxing unit on
the person's [his] property before the tax becomes delinquent if:
(1) the collector discovers that property on which the
tax has been or will be imposed is about to be removed from the
county; and
(2) the collector knows of no other personal property
in the county from which the tax may be satisfied.
SECTION 3.33. Section 33.23(b), Tax Code, is amended to
read as follows:
(b) A bond may not be required of the state or other [a]
taxing unit for issuance or delivery of a tax warrant, and a fee or
court cost may not be charged for issuance or delivery of a warrant.
SECTION 3.34. Section 33.44(b), Tax Code, is amended to
read as follows:
(b) For purposes of joining a county, citation may be served
on the county [tax] assessor-collector. For purposes of joining
any other taxing unit, citation may be served on the officer charged
with collecting taxes for the unit or on the presiding officer or
secretary of the governing body of the unit. For purposes of
joining the state, citation shall be served on the county
assessor-collector. Citation may be served by certified mail,
return receipt requested. A person on whom service is authorized by
this subsection may waive the issuance and service of citation in
behalf of the person's [his] taxing unit.
SECTION 3.35. Section 34.04(b), Tax Code, is amended to
read as follows:
(b) A copy of the petition shall be served, in the manner
prescribed by Rule 21a, Texas Rules of Civil Procedure, as amended,
or that rule's successor, on all parties to the underlying action
not later than the 20th day before the date set for a hearing on the
petition. The attorney general represents the state at the hearing
unless the attorney general delegates that duty to the county or
district attorney.
SECTION 3.36. The heading to Chapter 41, Tax Code, is
amended to read as follows:
CHAPTER 41. ADMINISTRATIVE [LOCAL] REVIEW
SECTION 3.37. Section 41.03, Tax Code, is amended to read as
follows:
Sec. 41.03. CHALLENGE BY STATE OR TAXING UNIT. (a) The
state or another [A] taxing unit is entitled to challenge before the
appraisal review board:
(1) the level of appraisals of any category of
property in the district or in any territory in the district, but
not the appraised value of a single taxpayer's property;
(2) an exclusion of property from the appraisal
records;
(3) a grant in whole or in part of a partial exemption;
(4) a determination that land qualifies for appraisal
as provided by Subchapter C, D, E, or H, Chapter 23; or
(5) failure to identify the taxing unit as one in which
a particular property is taxable.
(b) If the state or other [a] taxing unit challenges a
determination that land qualifies for appraisal under Subchapter H,
Chapter 23, on the ground that the land is not located in an
aesthetic management zone, critical wildlife habitat zone, or
streamside management zone, the state or other taxing unit must
first seek a determination letter from the director of the Texas
Forest Service. The appraisal review board shall accept the letter
as conclusive proof of the type, size, and location of the zone.
SECTION 3.38. Subchapter A, Chapter 41, Tax Code, is
amended by adding Section 41.031 to read as follows:
Sec. 41.031. CHALLENGE BY COMPTROLLER. The comptroller is
entitled to challenge before the appraisal review board the
exclusion of property from the appraisal roll for state ad valorem
taxes.
SECTION 3.39. Section 41.06(a), Tax Code, is amended to
read as follows:
(a) The secretary of the appraisal review board shall
deliver to the comptroller and the presiding officer of the
governing body of each taxing unit entitled to appear at a challenge
hearing written notice of the date, time, and place fixed for the
hearing. The secretary shall deliver the notice not later than the
10th day before the date of the hearing.
SECTION 3.40. Section 41.07(d), Tax Code, is amended to
read as follows:
(d) The board shall deliver by certified mail a notice of
the issuance of the order and a copy of the order to the taxing unit.
If the order of the board excludes property from the appraisal roll
for state ad valorem taxes, the board shall also deliver a notice of
issuance and a copy of the order to the comptroller in the manner
prescribed by the comptroller.
SECTION 3.41. Section 41.47(d), Tax Code, is amended to
read as follows:
(d) The board shall deliver by certified mail a notice of
issuance of the order and a copy of the order to the property owner
and the chief appraiser. If the order of the board excludes
property from the appraisal roll for state ad valorem taxes, the
board shall also deliver a notice of issuance and a copy of the
order to the comptroller in the manner prescribed by the
comptroller.
SECTION 3.42. Subchapter A, Chapter 42, Tax Code, is
amended by adding Section 42.032 to read as follows:
Sec. 42.032. RIGHT OF APPEAL BY COMPTROLLER. (a) The
comptroller is entitled to appeal an order of the appraisal review
board excluding property from the appraisal roll for state ad
valorem taxes.
(b) The attorney general shall represent the comptroller in
an appeal under this section. The attorney general may delegate its
duties under this section to a county or district attorney or may
contract with a private attorney for the performance of those
duties.
SECTION 3.43. Sections 42.06(a) and (c), Tax Code, are
amended to read as follows:
(a) To exercise the party's right to appeal an order of an
appraisal review board, a party other than a property owner must
file written notice of appeal within 15 days after the date the
party receives the notice required by Section 41.47 or, in the case
of a taxing unit or the comptroller, by Section 41.07 that the order
appealed has been issued. To exercise the right to appeal an order
of the comptroller, a party other than a property owner must file
written notice of appeal within 15 days after the date the party
receives the comptroller's order. A property owner is not required
to file a notice of appeal under this section.
(c) If the chief appraiser, a taxing unit, [or] a county, or
the comptroller appeals[, the chief appraiser, if the appeal is of]
an order of the appraisal review board, the chief appraiser [or the
comptroller, if the appeal is of an order of the comptroller,] shall
deliver a copy of the notice to the property owner whose property is
involved in the appeal. If the appeal is of an order of the
comptroller, the comptroller shall deliver a copy of the notice to
the property owner. The chief appraiser or the comptroller shall
deliver the copy of the notice within 10 days after the date the
notice is filed.
SECTION 3.44. Sections 42.43(a), (b), and (c), Tax Code,
are amended to read as follows:
(a) If the final determination of an appeal that decreases a
property owner's tax liability occurs after the property owner has
paid the owner's [his] taxes, the taxing unit and the comptroller,
if the property is subject to the state ad valorem tax, shall refund
to the property owner the difference between the amount of taxes
paid and amount of taxes for which the property owner is liable.
(b) For a refund made under this section because an
exemption under Section 11.20 that was denied by the chief
appraiser or appraisal review board is granted, the taxing unit or
the comptroller shall include with the refund interest on the
amount refunded calculated at an annual rate that is equal to the
auction average rate quoted on a bank discount basis for
three-month treasury bills issued by the United States government,
as published by the Federal Reserve Board, for the week in which the
taxes became delinquent, but not more than 10 percent, calculated
from the delinquency date for the taxes until the date the refund is
made. For any other refund made under this section, the taxing unit
or the comptroller shall include with the refund interest on the
amount refunded at an annual rate of eight percent, calculated from
the delinquency date for the taxes until the date the refund is
made.
(c) Notwithstanding Subsection (b), if a taxing unit or the
comptroller does not make a refund, including interest, required by
this section before the 60th day after the date the chief appraiser
certifies a correction to the appraisal roll under Section 42.41,
the taxing unit or the comptroller shall include with the refund
interest on the amount refunded at an annual rate of 12 percent,
calculated from the delinquency date for the taxes until the date
the refund is made.
SECTION 3.45. Sections 43.01 and 43.04, Tax Code, are
amended to read as follows:
Sec. 43.01. AUTHORITY TO BRING SUIT. The comptroller or a
[A] taxing unit may sue the appraisal district that appraises
property for the state or the unit to compel the appraisal district
to comply with the provisions of this title, rules of the
comptroller, or other applicable law.
Sec. 43.04. SUIT TO COMPEL COMPLIANCE WITH DEADLINES. The
comptroller or the governing body of a taxing unit may sue the chief
appraiser or members of the appraisal review board, as applicable,
for failure to comply with the deadlines imposed by Section
25.22(a), 26.01(a), or 41.12. If the court finds that the chief
appraiser or appraisal review board failed to comply for good cause
shown, the court shall enter an order fixing a reasonable deadline
for compliance. If the court finds that the chief appraiser or
appraisal review board failed to comply without good cause, the
court shall enter an order requiring the chief appraiser or
appraisal review board to comply with the deadline not later than
the 10th day after the date the judgment is signed. In a suit
brought under this section, the court may enter any other order the
court considers necessary to ensure compliance with the court's
deadline or the applicable statutory requirements. Failure to obey
an order of the court is punishable as contempt.
SECTION 3.46. The changes in law made by this article to
Chapter 41, Tax Code, apply only to a challenge or protest under
that chapter for which the notice is filed on or after the effective
date of this article. A challenge or protest for which the notice
is filed before the effective date of this article is covered by the
law in effect when the notice of protest was filed, and the former
law is continued in effect for that purpose.
SECTION 3.47. The changes in law made by this article apply
to each tax year that begins on or after January 1, 2006. The
changes in law do not apply to a tax year that begins before January
1, 2006, and the law as it existed before January 1, 2006, is
continued in effect for purposes of taxes imposed in that tax year.
ARTICLE 4. CONFORMING AMENDMENTS
SECTION 4.01. Subchapter A, Chapter 7, Education Code, is
amended by adding Section 7.007 to read as follows:
Sec. 7.007. PUBLIC EDUCATION INFORMATION MANAGEMENT SYSTEM
(PEIMS). (a) Each school district shall participate in the Public
Education Information Management System (PEIMS) and shall provide
through that system information required for the administration of
this code.
(b) Each school district shall use a uniform accounting
system adopted by the commissioner for the data required to be
reported for the Public Education Information Management System.
(c) Annually, the commissioner shall review the Public
Education Information Management System and shall repeal or amend
rules that require school districts to provide information through
the Public Education Information Management System that is not
necessary. In reviewing and revising the Public Education
Information Management System, the commissioner shall develop
rules to ensure that the system:
(1) provides useful, accurate, and timely information
on student demographics and academic performance, personnel, and
school district finances;
(2) contains only the data necessary for the
legislature and the agency to perform their legally authorized
functions in overseeing the public education system; and
(3) does not contain any information related to
instructional methods, except as required by federal law.
(d) The commissioner's rules must ensure that the Public
Education Information Management System links student performance
data to other related information for purposes of efficient and
effective allocation of school resources.
SECTION 4.02. Section 7.024(a), Education Code, is amended
to read as follows:
(a) The investment capital fund consists of money
transferred to the fund as provided by Section 42.453(e)(4)
[42.152(l)]. The agency shall administer the fund. The purposes of
this fund are to assist eligible public schools to implement
practices and procedures consistent with deregulation and school
restructuring in order to improve student achievement and to help
schools identify and train parents and community leaders who will
hold the school and the school district accountable for achieving
high academic standards.
SECTION 4.03. Section 8.051(d), Education Code, is amended
to read as follows:
(d) Each regional education service center shall maintain
core services for purchase by school districts and campuses. The
core services are:
(1) training and assistance in teaching each subject
area assessed under Section 39.023;
(2) training and assistance in providing each program
that qualifies for a funding allotment under Section 42.052,
42.053, 42.054, or 42.055 [42.151, 42.152, 42.153, or 42.156];
(3) assistance specifically designed for a school
district rated academically unacceptable under Section 39.072(a)
or a campus whose performance is considered unacceptable based on
the indicators adopted under Section 39.051;
(4) training and assistance to teachers,
administrators, members of district boards of trustees, and members
of site-based decision-making committees;
(5) assistance specifically designed for a school
district that is considered out of compliance with state or federal
special education requirements, based on the agency's most recent
compliance review of the district's special education programs; and
(6) assistance in complying with state laws and rules.
SECTION 4.04. Section 11.158(a), Education Code, is amended
to read as follows:
(a) The board of trustees of an independent school district
may require payment of:
(1) a fee for materials used in any program in which
the resultant product in excess of minimum requirements becomes, at
the student's option, the personal property of the student, if the
fee does not exceed the cost of materials;
(2) membership dues in student organizations or clubs
and admission fees or charges for attending extracurricular
activities, if membership or attendance is voluntary;
(3) a security deposit for the return of materials,
supplies, or equipment;
(4) a fee for personal physical education and athletic
equipment and apparel, although any student may provide the
student's own equipment or apparel if it meets reasonable
requirements and standards relating to health and safety
established by the board;
(5) a fee for items of personal use or products that a
student may purchase at the student's option, such as student
publications, class rings, annuals, and graduation announcements;
(6) a fee specifically permitted by any other statute;
(7) a fee for an authorized voluntary student health
and accident benefit plan;
(8) a reasonable fee, not to exceed the actual annual
maintenance cost, for the use of musical instruments and uniforms
owned or rented by the district;
(9) a fee for items of personal apparel that become the
property of the student and that are used in extracurricular
activities;
(10) a parking fee or a fee for an identification card;
(11) a fee for a driver training course, not to exceed
the actual district cost per student in the program for the current
school year;
(12) a fee for a course offered for credit that
requires the use of facilities not available on the school premises
or the employment of an educator who is not part of the school's
regular staff, if participation in the course is at the student's
option;
(13) a fee for a course offered during summer school,
except that the board may charge a fee for a course required for
graduation only if the course is also offered without a fee during
the regular school year;
(14) a reasonable fee for transportation of a student
who lives within two miles of the school the student attends to and
from that school, except that the board may not charge a fee for
transportation for which the school district receives funds under
Section 42.104 [42.155(d)]; or
(15) a reasonable fee, not to exceed $50, for costs
associated with an educational program offered outside of regular
school hours through which a student who was absent from class
receives instruction voluntarily for the purpose of making up the
missed instruction and meeting the level of attendance required
under Section 25.092.
SECTION 4.05. Section 12.013(b), Education Code, is amended
to read as follows:
(b) A home-rule school district is subject to:
(1) a provision of this title establishing a criminal
offense;
(2) a provision of this title relating to limitations
on liability; and
(3) a prohibition, restriction, or requirement, as
applicable, imposed by this title or a rule adopted under this
title, relating to:
(A) the Public Education Information Management
System (PEIMS) to the extent necessary to monitor compliance with
this subchapter as determined by the commissioner;
(B) educator certification under Chapter 21 and
educator rights under Sections 21.407, 21.408, and 22.001;
(C) criminal history records under Subchapter C,
Chapter 22;
(D) student admissions under Section 25.001;
(E) school attendance under Sections 25.085,
25.086, and 25.087;
(F) inter-district or inter-county transfers of
students under Subchapter B, Chapter 25;
(G) elementary class size limits under Section
25.112, in the case of any campus in the district that is considered
low-performing under Section 39.132;
(H) high school graduation under Section 28.025;
(I) special education programs under Subchapter
A, Chapter 29;
(J) bilingual education under Subchapter B,
Chapter 29;
(K) prekindergarten programs under Subchapter E,
Chapter 29;
(L) safety provisions relating to the
transportation of students under Sections 34.002, 34.003, 34.004,
and 34.008;
(M) computation and distribution of state aid
under Chapters 31, 42, and 43;
(N) extracurricular activities under Section
33.081;
(O) health and safety under Chapter 38;
(P) public school accountability under
Subchapters B, C, D, and G, Chapter 39;
(Q) [equalized wealth under Chapter 41;
[(R)] a bond or other obligation or tax rate
under Chapters 42, 43, and 45; and
(R) [(S)] purchasing under Chapter 44.
SECTION 4.06. Section 12.029(b), Education Code, is amended
to read as follows:
(b) If [Except as provided by Subchapter H, Chapter 41, if]
two or more school districts having different status, one of which
is home-rule school district status, consolidate into a single
district, the petition under Section 13.003 initiating the
consolidation must state the status for the consolidated district.
The ballot shall be printed to permit voting for or against the
proposition: "Consolidation of (names of school districts) into a
single school district governed as (status of school district
specified in the petition)."
SECTION 4.07. Section 12.106(a), Education Code, is amended
to read as follows:
(a) A charter holder is entitled to receive for the
open-enrollment charter school funding under Chapter 42 as if the
school were a school district [without a tier one local share for
purposes of Section 42.253 and] without any local revenue ("LR")
for purposes of Section 42.202 [42.302]. In determining funding
for an open-enrollment charter school:
(1) the adjustment [, adjustments] under Section
42.081 is [Sections 42.102, 42.103, 42.104, and 42.105 and the
district enrichment tax rate ("DTR") under Section 42.302 are based
on] the [average] adjustment for the school district in which the
school is located; and
(2) the district enrichment tax rate under Section
42.202 is the average district enrichment tax rate for the state.
SECTION 4.08. Section 13.282(a), Education Code, is amended
to read as follows:
(a) The amount of incentive aid payments may not exceed the
difference between:
(1) the sum of the entitlements computed under Section
42.402 [42.253] that would have been paid to the districts included
in the reorganized district if the districts had not been
consolidated; and
(2) the amount to which the reorganized district is
entitled under Section 42.402 [42.253].
SECTION 4.09. Sections 21.402(a) and (c), Education Code,
are 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 BA [FS]
where:
"MS" is the minimum monthly salary;
"SF" is the applicable salary factor specified by Subsection
(c); and
"BA" is the basic allotment under Section 42.051 ["FS" is the
amount, as determined by the commissioner under Subsection (b), of
state and local funds per weighted student available to a district
eligible to receive state assistance under Section 42.302 with an
enrichment tax rate, 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 H.B. No. 3343, Acts of the 77th Legislature, Regular
Session, 2001].
(c) The salary factors per step are as follows: Years Experience 0 1 2
any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 4.11. Section 21.411(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 4.12. Section 21.412(h), Education Code, is amended
to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 4.13. Section 21.413(h), Education Code, as added
by Section 2, Chapter 430, Acts of the 78th Legislature, Regular
Session, 2003, is amended to read as follows:
(h) A grant a school district receives under this section is
in addition to the [any] funding the district receives under
Chapter 42. The commissioner shall distribute funds under this
section with the Foundation School Program payment to which the
district is entitled as soon as practicable after the end of the
school year as determined by the commissioner. [A district to which
Chapter 41 applies is entitled to the grants paid under this
section. The commissioner shall determine the timing of the
distribution of grants to a district that does not receive
Foundation School Program payments.]
SECTION 4.14. Section 29.002, Education Code, is amended to
read as follows:
Sec. 29.002. DEFINITION. In this subchapter, "special
services" means:
(1) special education instruction, which may be
provided by professional and supported by paraprofessional
personnel in the regular classroom or in an instructional
arrangement described by Section 42.052 [42.151]; and
(2) related services, which are developmental,
corrective, supportive, or evaluative services, not instructional
in nature, that may be required for the student to benefit from
special education instruction and for implementation of a student's
individualized education program.
SECTION 4.15. Section 29.008(b), Education Code, is amended
to read as follows:
(b) Except as provided by Subsection (c), costs of an
approved contract for residential placement may be paid from a
combination of federal, state, and local funds. The legislature by
appropriation shall provide for the state's share of the costs of
these placements. [The local share of the total contract cost for
each student is that portion of the local tax effort that exceeds
the district's local fund assignment under Section 42.252, divided
by the average daily attendance in the district. If the contract
involves a private facility, the state share of the total contract
cost is that amount remaining after subtracting the local share. If
the contract involves a public facility, the state share is that
amount remaining after subtracting the local share from the portion
of the contract that involves the costs of instructional and
related services. For purposes of this subsection, "local tax
effort" means the total amount of money generated by taxes imposed
for debt service and maintenance and operation less any amounts
paid into a tax increment fund under Chapter 311, Tax Code.]
SECTION 4.16. Section 29.014(d), Education Code, is amended
to read as follows:
(d) The basic allotment for a student enrolled in a district
to which this section applies is adjusted by:
(1) the cost of education adjustment under Section
42.081 [42.102] for the school district in which the district is
geographically located; and
(2) the special allotment [weight] for a homebound
student under Section 42.052 [42.151(a)].
SECTION 4.17. Section 29.085, Education Code, is amended by
adding Subsections (e) and (f) to read as follows:
(e) The program established under this section is required
only in school districts in which the program is financed by funds
distributed under Section 42.453(e)(2) and any other funds
available for the program.
(f) The commissioner shall coordinate the funds withheld
under Section 42.453(e)(2) and any other funds available for the
program and shall distribute those funds. To receive funds for the
program, a school district must apply to the commissioner. The
commissioner shall give a preference to the districts that apply
that have the highest concentration of students who are pregnant or
who are parents.
SECTION 4.18. Section 29.087(j), Education Code, is amended
to read as follows:
(j) For purposes of funding under Chapters [41,] 42[,] and
46, a student attending a program authorized by this section may be
counted in attendance only for the actual number of hours each
school day the student attends the program, in accordance with
Sections 25.081 and 25.082.
SECTION 4.19. Section 29.203(b), Education Code, is amended
to read as follows:
(b) A school district is entitled to the allotment provided
by Section 42.057 [42.157] for each eligible student using a public
education grant. [If the district has a wealth per student greater
than the guaranteed wealth level but less than the equalized wealth
level, a school district is entitled under rules adopted by the
commissioner to additional state aid in an amount equal to the
difference between the cost to the district of providing services
to a student using a public education grant and the sum of the state
aid received because of the allotment under Section 42.157 and
money from the available school fund attributable to the student.]
SECTION 4.20. Section 33.002, Education Code, is amended by
amending Subsection (a) and adding Subsection (d) to read as
follows:
(a) This section applies only to a school district that
receives funds as provided by Section 42.453(e)(3) [42.152(i)].
(d) The commissioner shall coordinate the funds withheld
under Section 42.453(e)(3) and any other funds available for the
program and shall distribute those funds. To receive funds for the
program, a school district must apply to the commissioner. The
commissioner shall give a preference to the districts that apply
that have the highest concentration of at-risk students.
SECTION 4.21. Section 34.002(c), Education Code, is amended
to read as follows:
(c) A school district that fails or refuses to meet the
safety standards for school buses established under this section is
ineligible for a state transportation [to share in the
transportation] allotment under Subchapter C, Chapter 42, [Section
42.155] until the first anniversary of the date the district begins
complying with the safety standards.
SECTION 4.22. Section 37.0061, Education Code, is amended
to read as follows:
Sec. 37.0061. FUNDING FOR ALTERNATIVE EDUCATION SERVICES IN
JUVENILE RESIDENTIAL FACILITIES. A school district that provides
education services to pre-adjudicated and post-adjudicated
students who are confined by court order in a juvenile residential
facility operated by a juvenile board is entitled to count such
students in the district's average daily attendance for purposes of
receipt of state funds under the Foundation School Program. [If the
district has a wealth per student greater than the guaranteed
wealth level but less than the equalized wealth level, the district
in which the student is enrolled on the date a court orders the
student to be confined to a juvenile residential facility shall
transfer to the district providing education services an amount
equal to the difference between the average Foundation School
Program costs per student of the district providing education
services and the sum of the state aid and the money from the
available school fund received by the district that is attributable
to the student for the portion of the school year for which the
district provides education services to the student.]
SECTION 4.23. Section 39.031(a), Education Code, is amended
to read as follows:
(a) The cost of preparing, administering, or grading the
assessment instruments shall be paid from the funds allotted under
Section 42.054 [42.152], and each district shall bear the cost in
the same manner described for a reduction in allotments under
Section 42.402 [42.253]. If a district does not receive an
allotment under Section 42.054 [42.152], the commissioner shall
subtract the cost from the district's other foundation school fund
allotments.
SECTION 4.24. Section 39.134, Education Code, is amended to
read as follows:
Sec. 39.134. COSTS PAID BY DISTRICT. The costs of providing
a monitor, conservator, management team, or special campus
intervention team shall be paid by the district. If the district
fails or refuses to pay the costs in a timely manner, the
commissioner may:
(1) pay the costs using amounts withheld from any
funds to which the district is otherwise entitled; or
(2) recover the amount of the costs in the manner
provided for recovery of an overallocation of state funds under
Section 42.407 [42.258].
SECTION 4.25. Section 43.002(b), Education Code, is amended
to read as follows:
(b) Of the amounts available for transfer from the general
revenue fund to the available school fund for the months of January
and February of each fiscal year, no more than the amount necessary
to enable the comptroller to distribute from the available school
fund an amount equal to 9-1/2 percent of the estimated annual
available school fund apportionment to [category 1] school
districts[, as defined by Section 42.259, and 3-1/2 percent of the
estimated annual available school fund apportionment to category 2
school districts, as defined by Section 42.259,] may be transferred
from the general revenue fund to the available school fund. Any
remaining amount that would otherwise be available for transfer for
the months of January and February shall be transferred from the
general revenue fund to the available school fund in equal amounts
in June and in August of the same fiscal year.
SECTION 4.26. Section 45.003(a), Education Code, is amended
to read as follows:
(a) Bonds described by Section 45.001 may not be issued and
taxes described by that section [Section 45.001 or 45.002] may not
be levied unless authorized by a majority of the qualified voters of
the district[,] voting at an election held for that purpose[, at the
expense of the district, in accordance with the Election Code,
except as provided by this section. Each election must be called by
resolution or order of the governing board or commissioners court.
The resolution or order must state the date of the election, the
proposition or propositions to be submitted and voted on, the
polling place or places, and any other matters considered necessary
or advisable by the governing board or commissioners court].
SECTION 4.27. Section 45.111(b), Education Code, is amended
to read as follows:
(b) The governing body of the district shall provide for the
payment of the certificates issued under this section by
appropriating and pledging any local school funds derived from
maintenance taxes levied and assessed under Section [Sections
45.002 and] 130.122; Chapter 273, Acts of the 53rd Legislature,
Regular Session, 1953 (Article 2784g, Vernon's Texas Civil
Statutes); or other similar law that limits the amount of tax that
may be levied for maintenance purposes, as distinguished from bond
requirements. The appropriation and pledge may be in the nature of
a continuing irrevocable pledge to apply the first moneys collected
annually from the tax levy to the payment of the obligations or by
the irrevocable present levy and appropriation of the amount of the
maintenance tax required to meet the annual debt service
requirements of the obligations, in which event the governing body
shall covenant to annually set aside the amount in the annual tax
levy, showing the same is a portion of the maintenance tax. The
governing body shall annually budget the amount required to pay the
principal and interest of the obligations that may be scheduled to
become due in any fiscal year. This section may not be construed as
permitting the levy of a maintenance tax in excess of the amount
approved by the qualified voters of the district.
SECTION 4.28. Subchapter A, Chapter 46, Education Code, is
amended by adding Section 46.0011 to read as follows:
Sec. 46.0011. ADJUSTMENT FOR RAPID DECLINE IN TAXABLE VALUE
OF PROPERTY. (a) For purposes of this chapter, and to the extent
money specifically authorized to be used under this section is
available, the commissioner shall adjust the taxable value of
property in a school district that, due to factors beyond the
control of the board of trustees, experiences a rapid decline in the
tax base used in calculating taxable values in excess of four
percent of the tax base used in the preceding year.
(b) To the extent that a sufficient amount of money is not
available to fund all adjustments under this section, the
commissioner shall reduce adjustments in the manner provided by
Section 42.402(f) so that the total amount of adjustments equals
the amount of money available to fund the adjustments.
SECTION 4.29. Section 46.003(a), Education Code, is amended
to read as follows:
(a) For each year, except as provided by Sections 46.005 and
46.006, a school district is guaranteed a specified amount per
student in state and local funds for each cent of tax effort, up to
the maximum rate under Subsection (b), to pay the principal of and
interest on eligible bonds issued to construct, acquire, renovate,
or improve an instructional facility. The amount of state support
is determined by the formula:
FYA = (FYL X ADA X BTR X 100) - (BTR X (DPV/100))
where:
"FYA" is the guaranteed facilities yield amount of state
funds allocated to the district for the year;
"FYL" is the dollar amount guaranteed level of state and
local funds per student per cent of tax effort, which is $35 or a
greater amount for any year provided by appropriation;
"ADA" is the greater of the number of students in average
daily attendance, as determined under Section 42.005, in the
district or 400;
"BTR" is the district's bond tax rate for the current year,
which is determined by dividing the amount budgeted by the district
for payment of eligible bonds by the quotient of the district's
taxable value of property as determined under Subchapter M, Chapter
403, Government Code, or, if applicable, Section 46.0011 [42.2521],
divided by 100; and
"DPV" is the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, Section 46.0011 [42.2521].
SECTION 4.30. Section 46.006(g), Education Code, is amended
to read as follows:
(g) In this section, "wealth per student" means a school
district's taxable value of property as determined under Subchapter
M, Chapter 403, Government Code, or, if applicable, Section 46.0011
[42.2521], divided by the district's average daily attendance as
determined under Section 42.005.
SECTION 4.31. Sections 46.009(b) and (e), Education Code,
are amended to read as follows:
(b) If the amount appropriated for purposes of this
subchapter for a year is less than the total amount determined under
Subsection (a) for that year, the commissioner shall:
(1) transfer from the Foundation School Program to the
instructional facilities program the amount by which the total
amount determined under Subsection (a) exceeds the amount
appropriated; and
(2) reduce each district's foundation school fund
allocations in the manner provided by Section 42.402(f)
[42.253(h)].
(e) Section 42.407 [42.258] applies to payments under this
subchapter.
SECTION 4.32. Section 46.013, Education Code, is amended to
read as follows:
Sec. 46.013. MULTIPLE ALLOTMENTS PROHIBITED. A school
district is not entitled to state assistance under this subchapter
based on taxes with respect to which the district receives state
assistance under Subchapter E [F], Chapter 42.
SECTION 4.33. Section 46.032(a), Education Code, is amended
to read as follows:
(a) Each school district is guaranteed a specified amount
per student in state and local funds for each cent of tax effort to
pay the principal of and interest on eligible bonds. The amount of
state support, subject only to the maximum amount under Section
46.034, is determined by the formula:
EDA = (EDGL X ADA X EDTR X 100) - (EDTR X (DPV/100))
where:
"EDA" is the amount of state funds to be allocated to the
district for assistance with existing debt;
"EDGL" is the dollar amount guaranteed level of state and
local funds per student per cent of tax effort, which is $35 or a
greater amount for any year provided by appropriation;
"ADA" is the number of students in average daily attendance,
as determined under Section 42.005, in the district;
"EDTR" is the existing debt tax rate of the district, which is
determined by dividing the amount budgeted by the district for
payment of eligible bonds 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 46.0011
[42.2521], divided by 100; and
"DPV" is the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, under Section 46.0011 [42.2521].
SECTION 4.34. Section 46.037, Education Code, is amended to
read as follows:
Sec. 46.037. MULTIPLE ALLOTMENTS PROHIBITED. A school
district is not entitled to state assistance under this subchapter
based on taxes with respect to which the district receives state
assistance under Subchapter E [F], Chapter 42.
SECTION 4.35. Sections 56.208(a) and (b), Education Code,
are amended to read as follows:
(a) The Early High School Graduation Scholarship program is
financed under the Texas Education Excellence [Foundation School]
Program. [Funding for the state tuition credits is not subject to
the provisions of Sections 42.253(e) through (k).]
(b) The commissioner of education shall reduce the total
annual amount of Texas education [foundation school] fund payments
made to a school district by an amount equal to [F x A, where:
[(1) "F" is the lesser of one or the quotient of the
district's local share for the preceding school year under Section
42.252 divided by the amount of money to which the district was
entitled under Subchapters B and C, Chapter 42, for the preceding
school year; and
[(2) "A" is] the amount of state tuition credits under
this subchapter applied by institutions of higher education on
behalf of eligible persons who graduated from the district that has
not been used to compute a previous reduction under this
subsection.
SECTION 4.36. Section 87.208, Education Code, is amended to
read as follows:
Sec. 87.208. SEABORNE CONSERVATION CORPS. If the board of
regents of The Texas A&M University System administers a program
that is substantially similar to the Seaborne Conservation Corps as
it was administered by the board during the 1998-1999 school year,
the program is entitled, for each student enrolled, to allotments
from the Texas Education Excellence [Foundation School] Program
under Chapter 42 as if the program were a school district without
any local revenue for purposes of Section 42.202. In determining
funding for the program:
(1) the adjustment under Section 42.081 is the
adjustment[, except that the program has a local share applied that
is equivalent to the local fund assignment] of the school district
in which the principal facilities of the program are located; and
(2) the district enrichment tax rate under Section
42.202 is the average district enrichment tax rate for the state.
SECTION 4.37. Section 96.707(k), Education Code, is amended
to read as follows:
(k) For each student enrolled in the academy, the academy is
entitled to allotments from the Texas Education Excellence
[Foundation School] Program under Chapter 42 as if the academy were
a school district without any local revenue for purposes of Section
42.202. In determining funding for the academy:
(1) the adjustment under Section 42.081 is the
adjustment[, except that the academy has a local share applied that
is equivalent to the local fund assignment] of the Beaumont
Independent School District; and
(2) the district enrichment tax rate under Section
42.202 is the average district enrichment tax rate for the state.
SECTION 4.38. Sections 105.301(e) and (f), Education Code,
are amended to read as follows:
(e) The academy is not subject to the provisions of this
code, or to the rules of the Texas Education Agency, regulating
public schools, except that:
(1) professional employees of the academy are entitled
to the limited liability of an employee under Section 22.0511,
22.0512, or 22.052;
(2) a student's attendance at the academy satisfies
compulsory school attendance requirements; and
(3) for each student enrolled, the academy is entitled
to allotments from the Texas Education Excellence Program
[foundation school program] under Chapter 42 as if the academy were
a school district without any local revenue for purposes of Section
42.202. In determining funding for the academy:
(A) the adjustment under Section 42.081 is the
adjustment of the school district in which the principal facilities
of the academy are located; and
(B) the district enrichment tax rate under
Section 42.202 is the average district enrichment tax rate for the
state [a tier one local share for purposes of Section 42.253].
(f) If in any academic year the amount of the allotments
under Subsection (e)(3) exceeds the amount of state funds paid to
the academy under this section in the fiscal year ending August 31,
2003, the commissioner shall set aside from the total amount of
funds to which school districts are entitled under Section
42.402(c) [42.253(c)] an amount equal to the excess amount and
shall distribute that amount to the academy. After deducting the
amount set aside and paid to the academy by the commissioner under
this subsection, the commissioner shall reduce the amount to which
each district is entitled under Section 42.402(c) [42.253(c)] in
the manner described by Section 42.402(f) [42.253(h)]. A
determination of the commissioner under this section is final and
may not be appealed.
SECTION 4.39. Section 403.093(d), Government Code, is
amended to read as follows:
(d) The comptroller shall transfer from the general revenue
fund to the Texas education [foundation school] fund an amount of
money necessary to fund the Texas Education Excellence Program
[foundation school program] as provided by Chapter 42, Education
Code. The comptroller shall make the transfers in installments as
necessary to comply with Section 42.406 [42.259], Education Code.
An installment must be made not earlier than two days before the
date an installment to school districts is required by Section
42.406 [42.259], Education Code, and must not exceed the amount
necessary for that payment.
SECTION 4.40. Sections 403.302(a) and (k), Government Code,
are amended to read as follows:
(a) The comptroller shall conduct an annual study using
comparable sales and generally accepted auditing and sampling
techniques to determine the total taxable value of all property in
each school district. The study shall determine the taxable value
of all property and of each category of property in the district and
the productivity value of all land that qualifies for appraisal on
the basis of its productive capacity and for which the owner has
applied for and received a productivity appraisal. [The
comptroller shall make appropriate adjustments in the study to
account for actions taken under Chapter 41, Education Code.]
(k) For purposes of Section 42.202 [42.2522], Education
Code, the comptroller shall certify to the commissioner of
education:
(1) a final value for each school district computed
without any deduction for residence homestead exemptions granted
under Section 11.13(n), Tax Code; and
(2) a final value for each school district computed
after deducting one-half the total dollar amount of residence
homestead exemptions granted under Section 11.13(n), Tax Code.
SECTION 4.41. Section 404.121(1), Government Code, is
amended to read as follows:
(1) "Cash flow deficit" for any period means the
excess, if any, of expenditures paid and transfers made from the
general revenue fund in the period, including payments provided by
Section 42.406 [42.259], Education Code, over taxes and other
revenues deposited to the fund in the period, other than revenues
deposited pursuant to Section 403.092, that are legally available
for the expenditures and transfers.
SECTION 4.42. Section 2175.304(c), Government Code, is
amended to read as follows:
(c) The procedures established under Subsection (b) must
give preference to transferring the property directly to a public
school or school district or to an assistance organization
designated by the school district before disposing of the property
in another manner. If more than one public school or school
district or assistance organization seeks to acquire the same
property on substantially the same terms, the system, institution,
or agency shall give preference to a public school that is
considered low-performing by the commissioner of education or to a
school district that has a relatively low [taxable] wealth per
student, as determined by the commissioner of education [that
entitles the district to an allotment of state funds under
Subchapter F, Chapter 42, Education Code], or to the assistance
organization designated by such a school district.
SECTION 4.43. Section 1579.251, Insurance Code, is amended
by amending Subsection (a) and adding Subsections (c) and (d) to
read as follows:
(a) The state shall assist employees of participating
school districts and charter schools in the purchase of group
health coverage under this chapter by providing for each covered
employee the amount of $900 each state fiscal year or a greater
amount as provided by the General Appropriations Act. [The state
contribution shall be distributed through the school finance
formulas under Chapters 41 and 42, Education Code, and used by
school districts and charter schools as provided by Sections
42.2514 and 42.260, Education Code.]
(c) The trustee shall deposit state assistance for a
participating entity in the fund established under Subchapter G.
(d) A school district that does not participate in the
program is entitled to state assistance computed as provided by
Subsection (a). The trustee shall distribute state assistance
under this subsection in equal monthly installments. State funds
received under this subsection shall be deposited in a fund
described by Section 1581.052(b)(2).
SECTION 4.44. Section 6.02(b), Tax Code, is amended to read
as follows:
(b) A taxing unit that has boundaries extending into two or
more counties may choose to participate in only one of the appraisal
districts. In that event, the boundaries of the district chosen
extend outside the county to the extent of the unit's boundaries.
To be effective, the choice must be approved by resolution of the
board of directors of the district chosen. [The choice of a school
district to participate in a single appraisal district does not
apply to property annexed to the school district under Subchapter C
or G, Chapter 41, Education Code, unless:
[(1) the school district taxes property other than
property annexed to the district under Subchapter C or G, Chapter
41, Education Code, in the same county as the annexed property; or
[(2) the annexed property is contiguous to property in
the school district other than property annexed to the district
under Subchapter C or G, Chapter 41, Education Code.]
SECTION 4.45. Section 21.01, Tax Code, is amended to read as
follows:
Sec. 21.01. REAL PROPERTY. Real property is taxable by a
taxing unit if located in the unit on January 1[, except as provided
by Chapter 41, Education Code].
SECTION 4.46. Section 21.02(a), Tax Code, is amended to
read as follows:
(a) Except as provided by [Subsection (b) and] Sections
21.021, 21.04, and 21.05, tangible personal property is taxable by
a taxing unit if:
(1) it is located in the unit on January 1 for more
than a temporary period;
(2) it normally is located in the unit, even though it
is outside the unit on January 1, if it is outside the unit only
temporarily;
(3) it normally is returned to the unit between uses
elsewhere and is not located in any one place for more than a
temporary period; or
(4) the owner resides (for property not used for
business purposes) or maintains the owner's [his] principal place
of business in this state (for property used for business purposes)
in the unit and the property is taxable in this state but does not
have a taxable situs pursuant to Subdivisions (1) through (3) [of
this section].
SECTION 4.47. Section 39.903(e), Utilities Code, as amended
by Chapters 1394, 1451, and 1466, Acts of the 77th Legislature,
Regular Session, 2001, is amended to read as follows:
(e) The system benefit fund shall provide funding solely for
the following regulatory purposes and in the following order of
priority:
(1) programs to assist low-income electric customers
provided by Subsections (f)-(l);
[(1) programs to assist low-income electric customers
by providing the 10 percent reduced rate prescribed by Subsection
(h);]
(2) customer education programs;
(3)[,] administrative expenses incurred by the
commission in implementing and administering this chapter[,] and
expenses incurred by the office under this chapter; and
[(3) programs to assist low-income electric customers
by providing the targeted energy efficiency programs described by
Subsection (f)(2);
[(4) the school funding loss mechanism provided by
Section 39.901; and]
(4) reimbursement to the commission and the Texas
Department of Human Services for expenses incurred in the
implementation and administration of an integrated eligibility
process created under Section 17.007 for customer service discounts
relating to retail electric service, including outreach expenses
the commission determines are reasonable and necessary.
[(5) programs to assist low-income electric customers
by providing the 20 percent reduced rate prescribed by Subsection
(h).]
ARTICLE 5. REPEALER; TRANSITION; EFFECTIVE DATE
SECTION 5.01. (a) Sections 1-3, Chapter 201, Acts of the
78th Legislature, Regular Session, 2003, are repealed.
(b) The following provisions of the Education Code are
repealed:
(1) Chapter 41;
(2) Chapter 42, as it existed on January 1, 2005; and
(3) Sections 7.055(b)(34), 13.054(f) and (g),
13.282(b), 21.402(b), 29.203(c) and (g), 39.024(e), 45.002,
45.003(d), 45.006, 46.009(f), and 56.208(c).
(c) Sections 403.302(j) and 466.355(c), Government Code,
are repealed.
(d) The following provisions of the Insurance Code are
repealed:
(1) Section 1581.053(b); and
(2) Subchapter C, Chapter 1581.
(e) Sections 6.02(g), 6.03(m), 21.02(b) and (c), 25.25(k),
26.08(b)-(m), and 313.029, Tax Code, are repealed.
(f) Section 39.901, Utilities Code, is repealed.
SECTION 5.02. (a) Except as provided by Section 5.03 of
this Act, a school district maintenance tax rate imposed under
Sections 45.002 and 45.003, Education Code, before November 8,
2005, is void. The board of trustees of a school district may not
impose a district enrichment tax under Chapter 42, Education Code,
as added by this Act, without holding an election in compliance with
that chapter.
(b) The repeal by this Act of Section 45.002, Education
Code, does not affect the authority of a school district to collect
and use delinquent ad valorem taxes imposed under that section
before November 8, 2005.
SECTION 5.03. (a) The repeal by this Act of Sections 45.002
and 45.006, Education Code, does not impair any obligation created
by the issuance or execution of any lawful agreement or evidence of
indebtedness before September 1, 2006, that matures after that date
and that is payable from the levy and collection of a maintenance
tax under either of those sections or another law, and an
independent school district may, on and after September 1, 2006,
levy, assess, and collect a tax in the manner provided by Subchapter
E, Chapter 42, Education Code, as added by this Act to the extent
necessary to pay the obligations.
(b) Notwithstanding the repeal by this Act of Chapters 41
and 42, Education Code, and Section 45.002, Education Code, a
school district that, before September 1, 2006, issues bonds,
notes, or other evidences of indebtedness under Chapter 45,
Education Code, or other applicable law or enters into a
lease-purchase agreement under Subchapter A, Chapter 271, Local
Government Code, may continue, before, on, and after September 1,
2006, to receive state assistance with respect to such payments to
the same extent the district would have been entitled to receive the
assistance under Chapter 42, Education Code, as that chapter
existed before repeal by this Act, and the former law is continued
in effect for that purpose. The commissioner of education may adopt
rules to implement this subsection.
SECTION 5.04. A reference in law to the Foundation School
Program means the Texas Education Excellence Program. A reference
in law to the foundation school fund means the Texas education fund.
SECTION 5.05. (a) This Act applies beginning with the
2006-2007 school year.
(b) This Act takes effect January 1, 2006, but only if the
constitutional amendment proposed by ___.J.R. No. ___, 79th
Legislature, Regular Session, 2005, is approved by the voters. If
that amendment is not approved by the voters, this Act has no
effect.