79R8337 JD-D

By:  Janek, Williams                                              S.B. No. 1349



A BILL TO BE ENTITLED

AN ACT

relating to limiting increases in the appraised value of residence 
homesteads for ad valorem tax purposes.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 23.23, Tax Code, is amended by amending 
Subsection (a) and adding Subsections (g) and (h) to read as 
follows:
	(a)  The appraised value of a residence homestead for a tax 
year may not exceed the lesser of:
		(1)  the market value of the property; or                                     
		(2)  the sum of:                                                              
			(A)  five [10] percent of the appraised value of 
the property for the last year in which the property was appraised 
for taxation times the number of years since the property was last 
appraised;
			(B)  the appraised value of the property for the 
last year in which the property was appraised;  and
			(C)  the market value of all new improvements to 
the property.             
	(g)  The governing body of a taxing unit, in the manner 
required by law for official action, may at any time determine that 
the limitation provided by Subsection (a)(2) will not apply to the 
taxation of residence homesteads by the taxing unit in a tax year 
following the year in which the determination is made.  If the 
governing body of the taxing unit determines that the limitation 
provided by Subsection (a)(2) will not apply to the taxation of 
residence homesteads by the taxing unit, in the following and each 
subsequent tax year, the appraised value of a residence homestead 
for purposes of taxation by the taxing unit is the market value of 
the property.
	(h)  Subsection (g) does not affect the appraised value of 
property by a taxing unit other than the taxing unit whose governing 
body makes the determination under that subsection.  If the 
governing body that makes a determination under Subsection (g) sets 
the tax rate for more than one taxing unit, the determination does 
not apply to a taxing unit other than the taxing unit whose 
governing body makes the determination.
	SECTION 2.  This Act takes effect January 1, 2006, and 
applies only to the appraisal of a residence homestead for ad 
valorem tax purposes for a tax year that begins on or after January 
1, 2006, but only if the constitutional amendment proposed by the 
79th Legislature, Regular Session, 2005, authorizing the 
legislature to establish a lower limit on the maximum average 
annual percentage increase in the appraised value of residence 
homesteads for ad valorem tax purposes and to authorize the 
governing body of a taxing unit to determine whether a limit on 
residence homestead appraisal increases shall apply in the taxing 
unit is approved by the voters.  If that amendment is not approved 
by the voters, this Act has no effect.