By: Lucio III H.B. No. 2765

A BILL TO BE ENTITLED

AN ACT

relating to property tax relief, the school facilities allotment and the existing debt allotment under the Foundation School Program.

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

SECTION 1. Section 46.003(a), Education Code, is amended to read as follows:

Sec. 46.003. SCHOOL FACILITIES ALLOTMENT. (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 = EBP X (1 - (DYL/FYL)

[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;

"EBP" ["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, under Section 42.2521, divided by 100]; and

"DYL" ["DPV"] is the district's yield per penny per student which is determined by dividing the taxable value of property as determined under Subchapter M, Chapter 403, Government Code, or, if applicable, Section 42.2521, by the product of the district's ADA and 10,000.

SECTION 2. Section 46.032(a), Education Code, is amended to read as follows:

Sec. 46.032. ALLOTMENT. (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 = EDBP X (1 - (DYL/EDGL)

[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;

"EDBP" ["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 42.2521, divided by 100]; and

"DYL" ["DPV"] is the district's yield per penny per student which is determined by dividing the taxable value of property as determined under Subchapter M, Chapter 403, Government Code, or, if applicable, Section 42.2521, by the product of the district's ADA and 10,000.

SECTION 3. Section 46.034(c), Education Code, is amended to read as follows:

(c) If the amount required to pay the principal of and interest on eligible bonds in a school year is less than the amount of payments made by the district on the bonds during the final school year of the preceding state fiscal biennium or the district's audited debt service collections for that school year, the district may not receive aid in excess of the amount that, when added to the district's local revenue for the school year, equals the amount required to pay the principal of and interest on the bonds.

SECTION 4. The following provisions of the Education Code are repealed:

(1) Sections 46.003(b), (c) and (d);

(2) Sections 46.032(b), (c) and (d); and

(3) Sections 46.034(a), (b) and (b-1).

SECTION 5. A school district must use all revenues derived from the changes to Chapter 46, Education Code, provided by this Act to reduce the district's tax rate for bonded indebtedness or to reduce the maturity of previously issued bonds. The commissioner shall adopt rules regarding the operation and enforcement of this provision.

SECTION 6. 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, 2015.