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A BILL TO BE ENTITLED
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AN ACT
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relating to a limitation on the appraised value for ad valorem tax |
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purposes of certain residence homesteads of certain veterans. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1.12(d), Tax Code, is amended to read as |
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follows: |
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(d) For purposes of this section, the appraisal ratio of a |
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homestead to which Section 23.23 or 23.231 applies is the ratio of |
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the property's market value as determined by the appraisal district |
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or appraisal review board, as applicable, to the market value of the |
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property according to law. The appraisal ratio is not calculated |
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according to the appraised value of the property as limited by |
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Section 23.23 or 23.231. |
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SECTION 2. The heading to Section 23.23, Tax Code, is |
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amended to read as follows: |
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Sec. 23.23. LIMITATION ON APPRAISED VALUE OF RESIDENCE |
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HOMESTEAD IN GENERAL. |
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SECTION 3. Subchapter B, Chapter 23, Tax Code, is amended by |
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adding Section 23.231 to read as follows: |
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Sec. 23.231. LIMITATION ON APPRAISED VALUE OF RESIDENCE |
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HOMESTEADS OF CERTAIN VETERANS. (a) This section applies only to a |
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residence homestead owned by a veteran of the armed services of the |
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United States that was donated to or renovated for the veteran at no |
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charge to the veteran. |
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(b) Notwithstanding the requirements of Section 25.18 and |
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regardless of whether the appraisal office has appraised the |
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property and determined the market value of the property for the tax |
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year, an appraisal office may increase the appraised value of a |
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residence homestead for a tax year to an amount not to exceed the |
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lesser of: |
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(1) the market value of the property for the most |
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recent tax year that the market value was determined by the |
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appraisal office; |
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(2) for a residence homestead donated to a veteran, |
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the sum of: |
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(A) the appraised value of the land; and |
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(B) $150,000; or |
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(3) for a residence homestead renovated at no charge |
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to a veteran, the sum of: |
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(A) the appraised value of the property for the |
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tax year preceding the renovation; and |
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(B) the market value of all new improvements to |
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the property that are not renovations described by Subsection (a). |
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(c) When appraising a residence homestead, the chief |
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appraiser shall: |
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(1) appraise the property at its market value; and |
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(2) include in the appraisal records both the market |
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value of the property and the amount computed under Subsection |
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(b)(2) or (3), as applicable. |
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(d) The limitation provided by Subsection (b): |
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(1) takes effect as to a residence homestead beginning |
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on January 1 of the tax year following the first tax year the owner |
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qualifies the property for the limitation; and |
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(2) expires on January 1 of the first tax year the |
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property ceases to qualify for the limitation. |
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(e) This section does not apply to property appraised under |
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Subchapter C, D, E, F, G, or H. |
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(f) In this section, "new improvement" means an improvement |
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to a residence homestead made after the most recent appraisal of the |
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property that increases the market value of the property and the |
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value of which is not included in the appraised value of the |
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property for the preceding tax year. The term does not include |
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repairs to or ordinary maintenance of an existing structure or the |
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grounds or another feature of the property. |
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(g) Notwithstanding Subsections (b) and (f) and except as |
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provided by Subdivision (2), an improvement to property that would |
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otherwise constitute a new improvement is not treated as a new |
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improvement if the improvement is a replacement structure for a |
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structure that was rendered uninhabitable or unusable by a casualty |
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or by wind or water damage. For purposes of appraising the property |
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under Subsection (b) in the tax year in which the structure would |
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have constituted a new improvement: |
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(1) the appraised value the property would have had in |
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the preceding tax year if the casualty or damage had not occurred is |
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considered to be the appraised value of the property for that year, |
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regardless of whether that appraised value exceeds the actual |
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appraised value of the property for that year as limited by |
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Subsection (b); and |
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(2) the replacement structure is considered to be a |
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new improvement only if: |
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(A) the square footage of the replacement |
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structure exceeds that of the replaced structure as that structure |
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existed before the casualty or damage occurred; or |
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(B) the exterior of the replacement structure is |
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of higher quality construction and composition than that of the |
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replaced structure. |
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(h) To receive a limitation under Subsection (b), a person |
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claiming the limitation must apply for the limitation by filing an |
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application with the chief appraiser of the appraisal district. |
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For property appraised by more than one appraisal district, a |
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separate application must be filed in each appraisal district to |
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receive the limitation in that district. A limitation under |
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Subsection (b), once allowed, need not be claimed in subsequent |
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years and applies to the property until the limitation expires as |
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provided by this section. However, the chief appraiser may require |
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a person allowed a limitation in a prior year to file a new |
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application to confirm the person's current qualification for the |
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limitation by delivering not later than April 1 a written notice |
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that a new application is required, accompanied by an appropriate |
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application form, to the person previously allowed the limitation. |
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The comptroller, in prescribing the contents of the application |
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form, shall ensure that the form requires an applicant to provide |
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the information necessary to determine the validity of the |
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limitation claim. To the extent practicable, the provisions of |
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this code applicable to an application for a residence homestead |
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exemption apply to an application under this subsection, including |
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the provisions of Section 11.431 relating to late applications. A |
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person who receives a limitation under Subsection (b) shall notify |
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the appraisal office in writing before May 1 after the person's |
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qualification for the limitation ends. |
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SECTION 4. Section 42.26(d), Tax Code, is amended to read as |
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follows: |
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(d) For purposes of this section, the value of the property |
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subject to the suit and the value of a comparable property or sample |
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property that is used for comparison must be the market value |
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determined by the appraisal district when the property is a |
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residence homestead subject to the limitation on appraised value |
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imposed by Section 23.23 or 23.231. |
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SECTION 5. Section 44.004(c), Education Code, is amended to |
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read as follows: |
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(c) The notice of public meeting to discuss and adopt the |
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budget and the proposed tax rate may not be smaller than one-quarter |
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page of a standard-size or a tabloid-size newspaper, and the |
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headline on the notice must be in 18-point or larger type. Subject |
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to Subsection (d), the notice must: |
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(1) contain a statement in the following form: |
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"NOTICE OF PUBLIC MEETING TO DISCUSS BUDGET AND PROPOSED TAX RATE |
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"The (name of school district) will hold a public meeting at |
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(time, date, year) in (name of room, building, physical location, |
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city, state). The purpose of this meeting is to discuss the school |
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district's budget that will determine the tax rate that will be |
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adopted. Public participation in the discussion is invited." The |
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statement of the purpose of the meeting must be in bold type. In |
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reduced type, the notice must state: "The tax rate that is |
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ultimately adopted at this meeting or at a separate meeting at a |
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later date may not exceed the proposed rate shown below unless the |
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district publishes a revised notice containing the same information |
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and comparisons set out below and holds another public meeting to |
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discuss the revised notice."; |
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(2) contain a section entitled "Comparison of Proposed |
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Budget with Last Year's Budget," which must show the difference, |
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expressed as a percent increase or decrease, as applicable, in the |
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amounts budgeted for the preceding fiscal year and the amount |
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budgeted for the fiscal year that begins in the current tax year for |
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each of the following: |
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(A) maintenance and operations; |
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(B) debt service; and |
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(C) total expenditures; |
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(3) contain a section entitled "Total Appraised Value |
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and Total Taxable Value," which must show the total appraised value |
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and the total taxable value of all property and the total appraised |
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value and the total taxable value of new property taxable by the |
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district in the preceding tax year and the current tax year as |
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calculated under Section 26.04, Tax Code; |
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(4) contain a statement of the total amount of the |
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outstanding and unpaid bonded indebtedness of the school district; |
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(5) contain a section entitled "Comparison of Proposed |
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Rates with Last Year's Rates," which must: |
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(A) show in rows the tax rates described by |
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Subparagraphs (i)-(iii), expressed as amounts per $100 valuation of |
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property, for columns entitled "Maintenance & Operations," |
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"Interest & Sinking Fund," and "Total," which is the sum of |
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"Maintenance & Operations" and "Interest & Sinking Fund": |
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(i) the school district's "Last Year's |
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Rate"; |
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(ii) the "Rate to Maintain Same Level of |
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Maintenance & Operations Revenue & Pay Debt Service," which: |
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(a) in the case of "Maintenance & |
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Operations," is the tax rate that, when applied to the current |
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taxable value for the district, as certified by the chief appraiser |
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under Section 26.01, Tax Code, and as adjusted to reflect changes |
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made by the chief appraiser as of the time the notice is prepared, |
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would impose taxes in an amount that, when added to state funds to |
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be distributed to the district under Chapter 42, would provide the |
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same amount of maintenance and operations taxes and state funds |
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distributed under Chapter 42 per student in average daily |
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attendance for the applicable school year that was available to the |
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district in the preceding school year; and |
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(b) in the case of "Interest & Sinking |
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Fund," is the tax rate that, when applied to the current taxable |
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value for the district, as certified by the chief appraiser under |
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Section 26.01, Tax Code, and as adjusted to reflect changes made by |
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the chief appraiser as of the time the notice is prepared, and when |
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multiplied by the district's anticipated collection rate, would |
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impose taxes in an amount that, when added to state funds to be |
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distributed to the district under Chapter 46 and any excess taxes |
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collected to service the district's debt during the preceding tax |
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year but not used for that purpose during that year, would provide |
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the amount required to service the district's debt; and |
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(iii) the "Proposed Rate"; |
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(B) contain fourth and fifth columns aligned with |
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the columns required by Paragraph (A) that show, for each row |
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required by Paragraph (A): |
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(i) the "Local Revenue per Student," which |
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is computed by multiplying the district's total taxable value of |
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property, as certified by the chief appraiser for the applicable |
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school year under Section 26.01, Tax Code, and as adjusted to |
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reflect changes made by the chief appraiser as of the time the |
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notice is prepared, by the total tax rate, and dividing the product |
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by the number of students in average daily attendance in the |
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district for the applicable school year; and |
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(ii) the "State Revenue per Student," which |
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is computed by determining the amount of state aid received or to be |
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received by the district under Chapters 42, 43, and 46 and dividing |
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that amount by the number of students in average daily attendance in |
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the district for the applicable school year; and |
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(C) contain an asterisk after each calculation |
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for "Interest & Sinking Fund" and a footnote to the section that, in |
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reduced type, states "The Interest & Sinking Fund tax revenue is |
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used to pay for bonded indebtedness on construction, equipment, or |
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both. The bonds, and the tax rate necessary to pay those bonds, |
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were approved by the voters of this district."; |
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(6) contain a section entitled "Comparison of Proposed |
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Levy with Last Year's Levy on Average Residence," which must: |
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(A) show in rows the information described by |
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Subparagraphs (i)-(iv), rounded to the nearest dollar, for columns |
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entitled "Last Year" and "This Year": |
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(i) "Average Market Value of Residences," |
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determined using the same group of residences for each year; |
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(ii) "Average Taxable Value of Residences," |
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determined after taking into account the limitations [limitation] |
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on the appraised value of residences under Sections [Section] 23.23 |
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and 23.231, Tax Code, and after subtracting all homestead |
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exemptions applicable in each year, other than exemptions available |
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only to disabled persons or persons 65 years of age or older or |
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their surviving spouses, and using the same group of residences for |
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each year; |
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(iii) "Last Year's Rate Versus Proposed |
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Rate per $100 Value"; and |
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(iv) "Taxes Due on Average Residence," |
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determined using the same group of residences for each year; and |
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(B) contain the following information: "Increase |
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(Decrease) in Taxes" expressed in dollars and cents, which is |
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computed by subtracting the "Taxes Due on Average Residence" for |
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the preceding tax year from the "Taxes Due on Average Residence" for |
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the current tax year; |
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(7) contain the following statement in bold print: |
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"Under state law, the dollar amount of school taxes imposed on the |
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residence of a person 65 years of age or older or of the surviving |
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spouse of such a person, if the surviving spouse was 55 years of age |
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or older when the person died, may not be increased above the amount |
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paid in the first year after the person turned 65, regardless of |
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changes in tax rate or property value."; |
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(8) contain the following statement in bold print: |
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"Notice of Rollback Rate: The highest tax rate the district can |
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adopt before requiring voter approval at an election is (the school |
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district rollback rate determined under Section 26.08, Tax Code). |
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This election will be automatically held if the district adopts a |
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rate in excess of the rollback rate of (the school district rollback |
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rate)."; and |
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(9) contain a section entitled "Fund Balances," which |
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must include the estimated amount of interest and sinking fund |
|
balances and the estimated amount of maintenance and operation or |
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general fund balances remaining at the end of the current fiscal |
|
year that are not encumbered with or by corresponding debt |
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obligation, less estimated funds necessary for the operation of the |
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district before the receipt of the first payment under Chapter 42 in |
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the succeeding school year. |
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SECTION 6. Section 403.302(d), Government Code, as amended |
|
by Chapters 1186 (H.B. 3676) and 1328 (H.B. 3646), Acts of the 81st |
|
Legislature, Regular Session, 2009, is reenacted and amended to |
|
read as follows: |
|
(d) For the purposes of this section, "taxable value" means |
|
the market value of all taxable property less: |
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(1) the total dollar amount of any residence homestead |
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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 |
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district; |
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(2) one-half of the total dollar amount of any |
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residence homestead exemptions granted under Section 11.13(n), Tax |
|
Code, in the year that is the subject of the study for each school |
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district; |
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(3) the total dollar amount of any exemptions granted |
|
before May 31, 1993, within a reinvestment zone under agreements |
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authorized by Chapter 312, Tax Code; |
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(4) subject to Subsection (e), the total dollar amount |
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of any captured appraised value of property that: |
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(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 |
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fund by a school district are described in a written notification |
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provided by the municipality or the board of directors of the zone |
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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 |
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within the boundaries of the zone as those boundaries existed on |
|
September 1, 1999, including subsequent improvements to the |
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property regardless of when made; |
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(B) generates taxes paid into a tax increment |
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fund created under Chapter 311, Tax Code, under a reinvestment zone |
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financing plan approved under Section 311.011(d), Tax Code, on or |
|
before September 1, 1999; and |
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(C) is eligible for tax increment financing under |
|
Chapter 311, Tax Code; |
|
(5) the total dollar amount of any captured appraised |
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value of property that: |
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(A) is within a reinvestment zone: |
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(i) created on or before December 31, 2008, |
|
by a municipality with a population of less than 18,000; and |
|
(ii) the project plan for which includes |
|
the alteration, remodeling, repair, or reconstruction of a |
|
structure that is included on the National Register of Historic |
|
Places and requires that a portion of the tax increment of the zone |
|
be used for the improvement or construction of related facilities |
|
or for affordable housing; |
|
(B) generates school district taxes that are paid |
|
into a tax increment fund created under Chapter 311, Tax Code; and |
|
(C) is eligible for tax increment financing under |
|
Chapter 311, Tax Code; |
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(6) the total dollar amount of any exemptions granted |
|
under Section 11.251 or 11.253, 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, 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 |
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required by law; |
|
(9) a portion of the market value of property not |
|
otherwise fully taxable by the district at market value because of: |
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(A) action required by statute or the |
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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 |
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B or C, Chapter 313, Tax Code, before the expiration of the |
|
subchapter; |
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(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 or 23.231, Tax Code, |
|
applies exceeds the appraised value of that property as calculated |
|
under that section. |
|
SECTION 7. Section 403.302(i), Government Code, is amended |
|
to read as follows: |
|
(i) If the comptroller determines in the study that the |
|
market value of property in a school district as determined by the |
|
appraisal district that appraises property for the school district, |
|
less the total of the amounts and values listed in Subsection (d) as |
|
determined by that appraisal district, is valid, the comptroller, |
|
in determining the taxable value of property in the school district |
|
under Subsection (d), shall for purposes of Subsection (d)(13) |
|
subtract from the market value as determined by the appraisal |
|
district of residence homesteads to which Section 23.23 or 23.231, |
|
Tax Code, applies the amount by which that amount exceeds the |
|
appraised value of those properties as calculated by the appraisal |
|
district under Section 23.23 or 23.231, Tax Code. If the |
|
comptroller determines in the study that the market value of |
|
property in a school district as determined by the appraisal |
|
district that appraises property for the school district, less the |
|
total of the amounts and values listed in Subsection (d) as |
|
determined by that appraisal district, is not valid, the |
|
comptroller, in determining the taxable value of property in the |
|
school district under Subsection (d), shall for purposes of |
|
Subsection (d)(13) subtract from the market value as estimated by |
|
the comptroller of residence homesteads to which Section 23.23 or |
|
23.231, Tax Code, applies the amount by which that amount exceeds |
|
the appraised value of those properties as calculated by the |
|
appraisal district under Section 23.23 or 23.231, Tax Code. |
|
SECTION 8. Section 403.302(m), Government Code, as added by |
|
Chapter 1186 (H.B. 3676), Acts of the 81st Legislature, Regular |
|
Session, 2009, is amended to conform to Section 80, Chapter 1328 |
|
(H.B. 3646), Acts of the 81st Legislature, Regular Session, 2009, |
|
to read as follows: |
|
(m) Subsection (d)(9) [(d)(10)] does not apply to property |
|
that was the subject of an application under Subchapter B or C, |
|
Chapter 313, Tax Code, made after May 1, 2009, that the comptroller |
|
recommended should be disapproved. |
|
SECTION 9. To the extent of any conflict, this Act prevails |
|
over another Act of the 82nd Legislature, Regular Session, 2011, |
|
relating to nonsubstantive additions to and corrections in enacted |
|
codes. |
|
SECTION 10. This Act 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, 2012. |
|
SECTION 11. This Act takes effect January 1, 2012, but only |
|
if the constitutional amendment proposed by the 82nd Legislature, |
|
Regular Session, 2011, authorizing the legislature to provide for a |
|
limitation on the appraised value for ad valorem tax purposes of |
|
certain residence homesteads of certain veterans is approved by the |
|
voters. If that amendment is not approved by the voters, this Act |
|
has no effect. |