80R14560 JD-D

By: Coleman H.B. No. 2327

Substitute the following for H.B. No. 2327:

By: Villarreal C.S.H.B. No. 2327

A BILL TO BE ENTITLED

AN ACT

relating to the installment payment of ad valorem taxes imposed on a residence homestead.

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

SECTION 1. Section 31.01, Tax Code, is amended by adding Subsection (e-1) to read as follows:

(e-1) In the case of a residence homestead, the assessor shall include in a tax bill or separate statement a conspicuous statement reasonably designed to notify the property owner of the provisions of Section 31.072, including the entitlement of the property owner to contract with the collector for any taxing unit that imposes taxes on the residence homestead to establish an escrow account to provide for the payment of taxes imposed by that taxing unit. The statement must include the name, business address, and business telephone number of the collector for each taxing unit that imposes taxes on the residence homestead.

SECTION 2. Section 31.072, Tax Code, is amended by amending Subsections (a), (e), (g), and (h) and adding Subsection (g-1) to read as follows:

(a) Except as provided by Subsection (h), the [The] collector for a taxing unit may enter a contract with a property owner under which the property owner deposits money in an escrow account maintained by the collector to provide for the payment of property taxes collected by the collector on any property the person owns.

(e) The county tax assessor-collector shall maintain the escrow account in the county depository. Any other collector shall maintain the escrow account in the depository of the taxing unit or other entity that employs the collector. The collector is not required to maintain a separate account in the depository for each escrow account but shall maintain separate records for each escrow account. A collector shall retain any interest generated by the escrow account to defray the cost of administration of the procedure established by this section. Interest generated by an escrow account created under this section is the sole property of the collector, and the interest may not be used by any entity other than the collector. Interest generated by an escrow account may not be used to reduce or otherwise affect the annual appropriation to the collector that would otherwise be made.

(g) When the tax bill is prepared for property for which an escrow account is established, the collector shall apply the money in the account to the taxes imposed and, except as provided by Subsection (g-1), deliver a tax receipt to the taxpayer together with a refund of any amount in the account in excess of the amount of taxes paid. If the amount in the escrow account is not sufficient to pay the taxes in full, the collector shall apply the money to the taxes and deliver to the taxpayer a tax receipt for the partial payment and a tax bill for the unpaid amount. If the escrow account applies to more than one taxing unit or to more than one item of property, the collector shall apply the amount to each taxing unit or item of property in proportion to the amount of taxes imposed unless the contract provides otherwise.

(g-1) This subsection applies only to an escrow account established solely to provide for the payment of taxes imposed on the property owner's residence homestead. If authorized by the contract to establish the escrow account, in the event that the amount in the escrow account is greater than the amount of taxes paid:

(1) the account is continued for the purpose of providing for the payment of the taxes to be imposed on the property owner's residence homestead in subsequent years and that are collected by the collector; and

(2) the collector shall deliver a tax receipt to the taxpayer together with a written statement that informs the taxpayer of the amount remaining in the account.

(h) If an [Notwithstanding Subsection (a), if the property owner requesting a collector to establish an escrow account under this section is a disabled veteran as defined by Section 11.22 or a recipient of the Purple Heart, the Congressional Medal of Honor, the Bronze Star Medal, the Silver Star, the Legion of Merit, or a service cross awarded by a branch of the United States armed forces and the] escrow account is to be used solely to provide for the payment of [property] taxes collected by the collector on the property owner's residence homestead, the collector, on request of the property owner, shall enter into a contract with the property owner under this section.

SECTION 3. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2007.