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A BILL TO BE ENTITLED
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AN ACT
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relating to a temporary increase in the amount of the exemption of |
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residence homesteads from ad valorem taxation by a school district, |
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a temporary reduction in the amount of the limitation on school |
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district ad valorem taxes imposed on the residence homesteads of |
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the elderly or disabled to reflect the increased exemption amount, |
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and a temporary protection of school districts against the |
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resulting temporary loss in local revenue. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 11.13(b), Tax Code, is amended to read as |
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follows: |
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(b) An adult is entitled to exemption from taxation by a |
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school district of $105,000 [$25,000] of the appraised value of the |
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adult's residence homestead, except that only $5,000 of the |
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exemption applies to an entity operating under former Chapter 17, |
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18, 25, 26, 27, or 28, Education Code, as those chapters existed on |
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May 1, 1995, as permitted by Section 11.301, Education Code. |
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SECTION 2. Effective January 1, 2024, Section 11.13(b), Tax |
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Code, is amended to read as follows: |
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(b) An adult is entitled to exemption from taxation by a |
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school district of $25,000 of the appraised value of the adult's |
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residence homestead, except that only $5,000 of the exemption |
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applies to an entity operating under former Chapter 17, 18, 25, 26, |
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27, or 28, Education Code, as those chapters existed on May 1, 1995, |
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as permitted by Section 11.301, Education Code. |
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SECTION 3. (a) This section takes effect only if the |
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constitutional amendment proposed by S.J.R. No. 2, 87th |
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Legislature, 2nd Called Session, 2021, is approved by the voters. |
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If that amendment is not approved by the voters, this section has no |
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effect. |
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(b) Section 11.26(a), Tax Code, is amended to read as |
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follows: |
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(a) The tax officials shall appraise the property to which |
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this section applies and calculate taxes as on other property, but |
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if the tax so calculated exceeds the limitation imposed by this |
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section, the tax imposed is the amount of the tax as limited by this |
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section, except as otherwise provided by this section. A school |
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district may not increase the total annual amount of ad valorem tax |
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it imposes on the residence homestead of an individual 65 years of |
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age or older or on the residence homestead of an individual who is |
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disabled, as defined by Section 11.13, above the amount of the tax |
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it imposed in the first tax year in which the individual qualified |
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that residence homestead for the applicable exemption provided by |
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Section 11.13(c) for an individual who is 65 years of age or older |
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or is disabled. If the individual qualified that residence |
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homestead for the exemption after the beginning of that first year |
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and the residence homestead remains eligible for the same exemption |
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for the next year, and if the school district taxes imposed on the |
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residence homestead in the next year are less than the amount of |
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taxes imposed in that first year, a school district may not |
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subsequently increase the total annual amount of ad valorem taxes |
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it imposes on the residence homestead above the amount it imposed in |
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the year immediately following the first year for which the |
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individual qualified that residence homestead for the same |
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exemption, except as provided by Subsection (b). If the first tax |
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year the individual qualified the residence homestead for the |
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exemption provided by Section 11.13(c) for individuals 65 years of |
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age or older or disabled was a tax year before the 2023 [2015] tax |
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year, the amount of the limitation provided by this section for the |
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2023 tax year is the amount of the limitation as computed under |
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Subsection (a-5), (a-6), (a-7), (a-8), or (a-9) of this section, as |
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applicable, [tax the school district imposed for the 2014 tax year] |
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less an amount equal to the product of $80,000 and [amount |
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determined by multiplying $10,000 times] the tax rate of the school |
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district for the 2023 [2015] tax year[, plus any 2015 tax |
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attributable to improvements made in 2014, other than improvements |
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made to comply with governmental regulations or repairs]. If the |
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first tax year the individual qualified the residence homestead for |
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the exemption provided by Section 11.13(c) for individuals 65 years |
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of age or older or disabled was the 2023 tax year or an earlier tax |
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year, the amount of the limitation provided by this section for the |
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2024 tax year is the amount of the limitation as computed under |
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Subsection (a-10) of this section plus an amount equal to the |
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product of $80,000 and the tax rate of the school district for the |
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2023 tax year. |
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SECTION 4. (a) This section takes effect only if the |
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constitutional amendment proposed by S.J.R. No. 2, 87th |
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Legislature, 2nd Called Session, 2021, is not approved by the |
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voters. If that amendment is approved by the voters, this section |
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has no effect. |
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(b) Section 11.26(a), Tax Code, is amended to read as |
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follows: |
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(a) The tax officials shall appraise the property to which |
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this section applies and calculate taxes as on other property, but |
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if the tax so calculated exceeds the limitation imposed by this |
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section, the tax imposed is the amount of the tax as limited by this |
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section, except as otherwise provided by this section. A school |
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district may not increase the total annual amount of ad valorem tax |
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it imposes on the residence homestead of an individual 65 years of |
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age or older or on the residence homestead of an individual who is |
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disabled, as defined by Section 11.13, above the amount of the tax |
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it imposed in the first tax year in which the individual qualified |
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that residence homestead for the applicable exemption provided by |
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Section 11.13(c) for an individual who is 65 years of age or older |
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or is disabled. If the individual qualified that residence |
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homestead for the exemption after the beginning of that first year |
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and the residence homestead remains eligible for the same exemption |
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for the next year, and if the school district taxes imposed on the |
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residence homestead in the next year are less than the amount of |
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taxes imposed in that first year, a school district may not |
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subsequently increase the total annual amount of ad valorem taxes |
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it imposes on the residence homestead above the amount it imposed in |
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the year immediately following the first year for which the |
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individual qualified that residence homestead for the same |
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exemption, except as provided by Subsection (b). If the first tax |
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year the individual qualified the residence homestead for the |
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exemption provided by Section 11.13(c) for individuals 65 years of |
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age or older or disabled was a tax year before the 2023 [2015] tax |
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year, the amount of the limitation provided by this section for the |
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2023 tax year is the amount of tax the school district imposed for |
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the 2022 [2014] tax year less an amount equal to the product of |
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$80,000 and [amount determined by multiplying $10,000 times] the |
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tax rate of the school district for the 2023 [2015] tax year, plus |
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any 2023 [2015] tax attributable to improvements made in 2022 |
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[2014], other than improvements made to comply with governmental |
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regulations or repairs. If the first tax year the individual |
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qualified the residence homestead for the exemption provided by |
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Section 11.13(c) for individuals 65 years of age or older or |
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disabled was the 2023 tax year or an earlier tax year, the amount of |
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the limitation provided by this section for the 2024 and subsequent |
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tax years is the amount of tax the school district imposed for the |
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2023 tax year plus an amount equal to the product of $80,000 and the |
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tax rate of the school district for the 2023 tax year, plus any 2024 |
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tax attributable to improvements made in 2023, other than |
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improvements made to comply with governmental regulations or |
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repairs. |
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SECTION 5. Section 46.071, Education Code, is amended by |
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adding Subsections (a-1), (b-1), and (c-1) to read as follows: |
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(a-1) Notwithstanding Subsection (a), for the 2023-2024 |
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school year, a school district is entitled to additional state aid |
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under this subchapter to the extent that state and local revenue |
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used to service debt eligible under this chapter is less than the |
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state and local revenue that would have been available to the |
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district under this chapter as it existed on September 1, 2022, if |
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the increase in the residence homestead exemption under Section |
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1-b(c), Article VIII, Texas Constitution, and the additional |
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limitation on tax increases under Section 1-b(d) of that article as |
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proposed by the 87th Legislature, 3rd Called Session, 2021, had not |
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occurred. This subsection expires September 1, 2024. |
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(b-1) Notwithstanding Subsection (b), subject to |
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Subsections (c-1), (d), and (e), additional state aid under this |
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section for the 2023-2024 school year is equal to the amount by |
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which the loss of local interest and sinking revenue for debt |
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service attributable to the increase in the residence homestead |
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exemption under Section 1-b(c), Article VIII, Texas Constitution, |
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and the additional limitation on tax increases under Section 1-b(d) |
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of that article as proposed by the 87th Legislature, 3rd Called |
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Session, 2021, is not offset by a gain in state aid under this |
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chapter. This subsection expires September 1, 2024. |
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(c-1) Notwithstanding Subsection (c), for the purpose of |
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determining state aid under Subsections (a-1) and (b-1), local |
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interest and sinking revenue for debt service is limited to revenue |
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required to service debt eligible under this chapter as of |
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September 1, 2022, including refunding of that debt, subject to |
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Section 46.061. The limitation imposed by Section 46.034(a) does |
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not apply for the purpose of determining state aid under this |
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section. This subsection expires September 1, 2024. |
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SECTION 6. Subchapter F, Chapter 48, Education Code, is |
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amended by adding Section 48.2543 to read as follows: |
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Sec. 48.2543. ADDITIONAL STATE AID FOR HOMESTEAD EXEMPTION |
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AND LIMITATION ON TAX INCREASES FOR THE 2023-2024 SCHOOL YEAR. (a) |
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For the 2023-2024 school year, a school district is entitled to |
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additional state aid to the extent that state and local revenue |
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under this chapter and Chapter 49 is less than the state and local |
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revenue that would have been available to the district under this |
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chapter and Chapter 49 as those chapters existed on September 1, |
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2022, if the increase in the residence homestead exemption under |
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Section 1-b(c), Article VIII, Texas Constitution, and the |
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additional limitation on tax increases under Section 1-b(d) of that |
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article as proposed by the 87th Legislature, 3rd Called Session, |
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2021, had not occurred. |
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(b) The lesser of the school district's currently adopted |
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maintenance and operations tax rate or the adopted maintenance and |
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operations tax rate for the 2022 tax year is used for the purpose of |
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determining additional state aid under Subsection (a). |
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(c) This section expires September 1, 2024. |
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SECTION 7. The changes in law made by this Act to Sections |
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11.13 and 11.26, Tax Code, apply only to an ad valorem tax year that |
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begins on or after January 1, 2023. |
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SECTION 8. This Act takes effect January 1, 2023, but only |
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if the constitutional amendment proposed by the 87th Legislature, |
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3rd Called Session, 2021, to appropriate money from the economic |
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stabilization fund to the foundation school fund and use the money |
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to finance a temporary increase in the amount of the exemption of |
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residence homesteads from ad valorem taxation by a school district |
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and a temporary reduction in the amount of the limitation on school |
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district ad valorem taxes imposed on the residence homesteads of |
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the elderly or disabled to reflect the increased exemption amount |
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is approved by the voters. If that amendment is not approved by the |
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voters, this Act has no effect. |