80R3225 SMH-D

By: Guillen H.B. No. 3067

A BILL TO BE ENTITLED

AN ACT

relating to a limitation on the total amount of ad valorem taxes that may be imposed by a taxing unit on the residence homestead of an eligible person who is a member of a reserve component of the United States armed forces and is ordered to active military duty.

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

SECTION 1. Subchapter B, Chapter 11, Tax Code, is amended by adding Section 11.262 to read as follows:

Sec. 11.262. LIMITATION OF TAX ON HOMESTEADS OF CERTAIN ACTIVE-DUTY ARMED FORCES MEMBERS. (a) This section applies only to a taxing unit that has established a limitation under Section 1-b(i), Article VIII, Texas Constitution, on the total amount of taxes that may be imposed by the taxing unit on the residence homestead of an eligible person who is a member of a reserve component of the armed forces of the United States, including the National Guard, and is ordered to active duty by a proper authority. A tax limitation under that subsection applies to the imposition of taxes by the political subdivision on residence homesteads beginning with the first tax year after the year in which the political subdivision establishes the limitation.

(b) To be eligible for a limitation on tax increases under this section for a tax year, an individual must:

(1) be deployed or stationed on active duty for any part of that tax year at a location that is at least 60 miles from the individual's residence homestead; and

(2) have been continuously deployed or stationed on active duty for at least the preceding six months, disregarding temporary periods of leave or other absence, at one or more locations each of which is at least 60 miles from the individual's residence homestead.

(c) This section applies only to property that receives an exemption under Section 11.13 and is the residence homestead of an individual who is eligible for the limitation under Subsection (b).

(d) Except as provided by Subsection (e), a taxing unit may not increase the total annual amount of ad valorem taxes it imposes on the residence homestead of an individual who is eligible for a limitation on tax increases under this section above the amount of the taxes the unit imposed on the property in the preceding tax year if the property qualified as the individual's residence homestead in the preceding tax year. The tax officials shall appraise the homestead and calculate taxes as on other property, but if the tax so calculated exceeds the limitation provided by this section, the tax imposed is the amount of the tax as limited by this section, except as otherwise provided by this section.

(e) If improvements have been made to the individual's residence homestead, other than repairs and other than improvements made to comply with governmental requirements, since the most recent appraisal of the property, the taxing unit may increase the amount of taxes on the homestead in the first year the appraised 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 between the appraised value of the homestead with the improvements and the appraised value the homestead would have had without the improvements.

(f) An individual is eligible for a limitation on tax increases under this section for a tax year if the individual qualifies the residence homestead for an exemption under Section 11.13 for that tax year and meets the requirements of Subsections (b) and (c) at any time during that tax year and if the individual qualified the homestead for an exemption under Section 11.13 for the preceding tax year. To receive a limitation on tax increases under this section, an individual claiming the limitation must file an application for the limitation with the chief appraiser of the appraisal district. The chief appraiser shall accept and approve or deny the application. For property appraised by more than one appraisal district, a separate application must be filed in each appraisal district to receive a limitation in that district. A limitation under this section, once allowed, need not be claimed in subsequent years and applies to the property until the limitation expires as provided by this section or until the individual's qualification for the limitation ends. However, the chief appraiser may require an individual allowed a limitation in a prior year to file a new application to confirm the individual's current qualification for the limitation by delivering, not later than April 1, a written notice that a new application is required, accompanied by an appropriate application form, to the individual previously allowed the limitation.

(g) In this subsection, "driver's license" and "personal identification certificate" have the meanings assigned by Section 11.43(f). The comptroller, in prescribing the contents of the application form for a limitation on tax increases under this section, shall ensure that the form requires an applicant to provide the information necessary to determine the validity of the limitation claim. The form must require an applicant to provide the applicant's name and driver's license number, personal identification certificate number, or social security number. The comptroller shall include on the form:

(1) a notice of the penalties prescribed by Section 37.10, Penal Code, for making or filing an application containing a false statement; and

(2) a statement explaining that the application need not be made annually and that if the limitation is allowed, the applicant has a duty to notify the chief appraiser when the applicant's qualification for the limitation ends.

(h) An individual who is required to apply for a limitation on tax increases under this section to receive the limitation for a tax year must apply for the limitation not later than May 1 or the 90th day after the date the individual has served on active duty at a location and for the minimum period required by Subsection (b) to qualify for the limitation, whichever is later. Except as provided by Subsection (i), if the individual fails to timely file a completed application, the individual may not receive the limitation for that year.

(i) The chief appraiser shall accept and approve or deny an application for a limitation on tax increases under this section after the deadline for filing the application under Subsection (h) has passed if the application is filed not later than one year after the delinquency date for the taxes on the property for that tax year. If a late application is approved after approval of the appraisal records by the appraisal review board, the chief appraiser shall notify the collector for each taxing unit in which the property is located. If the tax has not been paid, the collector shall deduct from the individual's tax bill the difference between the taxes that would have been due had the property not qualified for the limitation and the taxes due after taking the limitation into account. If the tax has been paid, the collector shall immediately refund the difference.

(j) An individual who receives a limitation on tax increases under this section shall notify the appraisal office in writing before May 1 after the individual's qualification for the limitation ends.

(k) If the appraisal roll provides for taxation of appraised value for a prior year because a limitation on tax increases under this section was erroneously allowed, the tax assessor for each taxing unit shall add, as back taxes due as provided by Section 26.09(d), the positive difference, if any, between the tax that should have been imposed for that year and the tax that was imposed because of this section.

(l) A limitation on tax increases under this section expires on January 1 of the first tax year that:

(1) none of the owners of the property who qualify for an exemption provided by Section 11.13 and who owned the property when the limitation first took effect is using the property as a residence homestead;

(2) none of the owners of the property qualifies for an exemption provided by Section 11.13; or

(3) none of the owners of the property who met the requirements of Subsections (b) and (c) when the limitation first took effect meets the requirements of those subsections.

(m) For each school district in an appraisal district, the chief appraiser shall determine the portion of the appraised value of residence homesteads of individuals on which school district taxes are not imposed in a tax year because of the limitation on tax increases under this section. That portion is calculated by determining the taxable value that, if multiplied by the tax rate adopted by the school district for the tax year, would produce an amount equal to the amount of tax that would have been imposed by the school district on those homesteads if the limitation on tax increases under this section were not in effect, but that was not imposed because of that limitation. The chief appraiser shall determine that taxable value and certify it to the comptroller as soon as practicable for each tax year.

(n) A limitation on tax increases under this section does not expire because the owner of an interest in the property conveys the interest to a qualifying trust as defined by Section 11.13(j) if the owner or the owner's spouse is a trustor of the trust and is entitled to occupy the property.

(o) If an individual who receives a limitation on tax increases by a taxing unit under this section on a residence homestead in the last year in which the individual resided in the property on January 1 qualifies a different residence homestead in the same taxing unit for an exemption under Section 11.13 during the same period of service on active duty, the taxing unit may not impose ad valorem taxes on the subsequently qualified homestead in the first year in which the individual qualified the new residence homestead for the exemption in an amount that exceeds the amount of taxes the taxing unit would have imposed on the subsequently qualified homestead in that first year had the limitation provided by this subsection not been in effect, multiplied by a fraction the numerator of which is the total amount of ad valorem taxes imposed by the taxing unit on the former homestead in the last year in which the individual received the limitation provided by Subsection (d) for the former homestead and the denominator of which is the total amount of ad valorem taxes that would have been imposed by the taxing unit on the former homestead in the last year in which the individual received the limitation for the former homestead had the limitation not been in effect.

(p) An individual who receives a limitation on tax increases by a taxing unit under this section and who subsequently applies for a limitation by the same taxing unit on a different residence homestead, 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 a limitation by the taxing unit on the subsequently qualified homestead under Subsection (o) and to calculate the amount of taxes the taxing unit may impose on the subsequently qualified homestead.

SECTION 2. Sections 23.19(b) and (g), Tax Code, are amended to read as follows:

(b) If an appraisal district receives a written request for the appraisal of real property and improvements of a cooperative housing corporation according to the separate interests of the corporation's stockholders, the chief appraiser shall separately appraise the interests described by Subsection (d) if the conditions required by Subsections (e) and (f) have been met. Separate appraisal under this section is for the purposes of administration of tax exemptions, determination of applicable limitations of taxes under Section 11.26, [or] 11.261, or 11.262, and apportionment by a cooperative housing corporation of property taxes among its stockholders but is not the basis for determining value on which a tax is imposed under this title. A stockholder whose interest is separately appraised under this section may protest and appeal the appraised value in the manner provided by this title for protest and appeal of the appraised value of other property.

(g) A tax bill or a separate statement accompanying the tax bill to a cooperative housing corporation for which interests of stockholders are separately appraised under this section must state, in addition to the information required by Section 31.01, the appraised value and taxable value of each interest separately appraised. Each exemption claimed as provided by this title by a person entitled to the exemption shall also be deducted from the total appraised value of the property of the corporation. The total tax imposed by a taxing unit [school district, county, municipality, or junior college district] shall be reduced by any amount that represents an increase in taxes attributable to separately appraised interests of the real property and improvements that are subject to the limitation of taxes prescribed by Section 11.26, [or] 11.261, or 11.262. The corporation shall apportion among its stockholders liability for reimbursing the corporation for property taxes according to the relative taxable values of their interests.

SECTION 3. Sections 26.012(6), (13), and (14), Tax Code, are amended to read as follows:

(6) "Current total value" means the total taxable value of property listed on the appraisal roll for the current year, including all appraisal roll supplements and corrections as of the date of the calculation, less the taxable value of property exempted for the current tax year for the first time under Section 11.31, except that:

(A) the current total value for a school district excludes:

(i) the total value of homesteads that qualify for a tax limitation as provided by Section 11.26; and

(ii) new property value of property that is subject to an agreement entered into under Chapter 313; [and]

(B) the current total value for a county, municipality, or junior college district excludes the total value of homesteads that qualify for a tax limitation provided by Section 11.261 applicable to the taxing unit; and

(C) the current total value for a taxing unit excludes the total value of homesteads that qualify for a tax limitation provided by Section 11.262 applicable to the taxing unit.

(13) "Last year's levy" means the total of:

(A) the amount of taxes that would be generated by multiplying the total tax rate adopted by the governing body in the preceding year by the total taxable value of property on the appraisal roll for the preceding year, including:

(i) taxable value that was reduced in an appeal under Chapter 42; and

(ii) all appraisal roll supplements and corrections other than corrections made pursuant to Section 25.25(d), as of the date of the calculation, except that last year's taxable value for a school district excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.26, [and] last year's taxable value for a county, municipality, or junior college district excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.261 applicable to the taxing unit, and last year's taxable value for a taxing unit excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.262 applicable to the taxing unit; and

(B) the amount of taxes refunded by the taxing unit in the preceding year for tax years before that year.

(14) "Last year's total value" means the total taxable value of property listed on the appraisal roll for the preceding year, including all appraisal roll supplements and corrections, other than corrections made pursuant to Section 25.25(d), as of the date of the calculation, except that:

(A) last year's taxable value for a school district excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.26; [and]

(B) last year's taxable value for a county, municipality, or junior college district excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.261 applicable to the taxing unit; and

(C) last year's taxable value for a taxing unit excludes the total value of homesteads that qualified for a tax limitation as provided by Section 11.262 applicable to the taxing unit.

SECTION 4. Section 44.004, Education Code, is amended by adding Subsection (c-2) to read as follows:

(c-2) If the school district has established a limitation under Section 1-b(i), Article VIII, Texas Constitution, on the total amount of ad valorem taxes that may be imposed by the district on the residence homestead of an eligible person who is a member of a reserve component of the United States armed forces and is ordered to active duty, the notice required by Subsection (c) must also contain the following statement in bold print: "Under state law, the dollar amount of school taxes imposed on the residence homestead of an eligible person who is a member of a reserve component of the United States armed forces and is ordered to active duty may not be increased above the amount of school taxes imposed on the property in the preceding year, regardless of changes in tax rate or property value."

SECTION 5. Section 403.302(d), Government Code, is amended to read as follows:

(d) For the purposes of this section, "taxable value" means the market value of all taxable property less:

(1) the total dollar amount of any residence homestead exemptions lawfully granted under Section 11.13(b) or (c), Tax Code, in the year that is the subject of the study for each school district;

(2) one-half of the total dollar amount of any residence homestead exemptions granted under Section 11.13(n), Tax Code, in the year that is the subject of the study for each school district;

(3) the total dollar amount of any exemptions granted before May 31, 1993, within a reinvestment zone under agreements authorized by Chapter 312, Tax Code;

(4) subject to Subsection (e), the total dollar amount of any captured appraised value of property that:

(A) is within a reinvestment zone created on or before May 31, 1999, or is proposed to be included within the boundaries of a reinvestment zone as the boundaries of the zone and the proposed portion of tax increment paid into the tax increment fund by a school district are described in a written notification provided by the municipality or the board of directors of the zone to the governing bodies of the other taxing units in the manner provided by Section 311.003(e), Tax Code, before May 31, 1999, and within the boundaries of the zone as those boundaries existed on September 1, 1999, including subsequent improvements to the property regardless of when made;

(B) generates taxes paid into a tax increment fund created under Chapter 311, Tax Code, under a reinvestment zone financing plan approved under Section 311.011(d), Tax Code, on or before September 1, 1999; and

(C) is eligible for tax increment financing under Chapter 311, Tax Code;

(5) for a school district for which a deduction from taxable value is made under Subdivision (4), an amount equal to the taxable value required to generate revenue when taxed at the school district's current tax rate in an amount that, when added to the taxes of the district paid into a tax increment fund as described by Subdivision (4)(B), is equal to the total amount of taxes the district would have paid into the tax increment fund if the district levied taxes at the rate the district levied in 2005;

(6) the total dollar amount of any exemptions granted under Section 11.251, Tax Code;

(7) the difference between the comptroller's estimate of the market value and the productivity value of land that qualifies for appraisal on the basis of its productive capacity, except that the productivity value estimated by the comptroller may not exceed the fair market value of the land;

(8) the portion of the appraised value of residence homesteads of individuals who receive a tax limitation under Section 11.26 or 11.262, Tax Code, on which school district taxes are not imposed in the year that is the subject of the study, calculated as if the residence homesteads were appraised at the full value required by law;

(9) a portion of the market value of property not otherwise fully taxable by the district at market value because of:

(A) action required by statute or the constitution of this state that, if the tax rate adopted by the district is applied to it, produces an amount equal to the difference between the tax that the district would have imposed on the property if the property were fully taxable at market value and the tax that the district is actually authorized to impose on the property, if this subsection does not otherwise require that portion to be deducted; or

(B) action taken by the district under Subchapter B or C, Chapter 313, Tax Code;

(10) the market value of all tangible personal property, other than manufactured homes, owned by a family or individual and not held or used for the production of income;

(11) the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.06, Tax Code;

(12) the portion of the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.065, Tax Code; and

(13) the amount by which the market value of a residence homestead to which Section 23.23, Tax Code, applies exceeds the appraised value of that property as calculated under that section.

SECTION 6. This Act applies only to ad valorem taxes imposed for a tax year beginning on or after the effective date of this Act.

SECTION 7. This Act takes effect January 1, 2008, but only if the constitutional amendment to authorize a political subdivision to establish a limitation on the total amount of ad valorem taxes that may be imposed by the political subdivision on the residence homestead of an eligible person who is a member of a reserve component of the United States armed forces and is ordered to active military duty is approved by the voters. If that amendment is not approved by the voters, this Act has no effect.