87S30452 CJC/MEW-D

By: Raymond H.J.R. No. 22

A JOINT RESOLUTION

proposing a constitutional amendment to appropriate money from the economic stabilization fund to the foundation school fund and use the money to finance a temporary increase in the amount of the exemption of residence homesteads from ad valorem taxation by a school district and a temporary reduction in the amount of the limitation on school district ad valorem taxes imposed on the residence homesteads of the elderly or disabled to reflect the increased exemption amount.

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

SECTION 1. Section 49-g, Article III, Texas Constitution, is amended by adding Subsection (p) to read as follows:

(p) On December 1, 2022, $5 billion of the unobligated and otherwise unappropriated balance of the economic stabilization fund is appropriated to the foundation school fund to finance for the 2023 tax year a temporary increase in the amount of the exemption of residence homesteads from ad valorem taxation for general elementary and secondary public school purposes under Section 1-b(c), Article VIII, of this constitution, and a temporary reduction in the amount of the limitation on the total amount of ad valorem taxes for general elementary and secondary public school purposes imposed on the residence homesteads of the elderly or disabled under Section 1-b(d), Article VIII, of this constitution to reflect the increased exemption amount. This subsection expires December 31, 2023.

SECTION 2. Section 1-b(c), Article VIII, Texas Constitution, is amended to read as follows:

(c) Except as otherwise provided by this subsection, the [The] amount of $25,000 of the market value of the residence homestead of a married or unmarried adult, including one living alone, is exempt from ad valorem taxation for general elementary and secondary public school purposes. For the 2023 tax year, the amount of $105,000 of the market value of the residence homestead of such a person is exempt from ad valorem taxation for those purposes. The legislature by general law may provide that all or part of the exemption does not apply to a district or political subdivision that imposes ad valorem taxes for public education purposes but is not the principal school district providing general elementary and secondary public education throughout its territory. In addition to this exemption, the legislature by general law may exempt an amount not to exceed $10,000 of the market value of the residence homestead of a person who is disabled as defined in Subsection (b) of this section and of a person 65 years of age or older from ad valorem taxation for general elementary and secondary public school purposes. The legislature by general law may base the amount of and condition eligibility for the additional exemption authorized by this subsection for disabled persons and for persons 65 years of age or older on economic need. An eligible disabled person who is 65 years of age or older may not receive both exemptions from a school district but may choose either. An eligible person is entitled to receive both the exemption required by this subsection for all residence homesteads and any exemption adopted pursuant to Subsection (b) of this section, but the legislature shall provide by general law whether an eligible disabled or elderly person may receive both the additional exemption for the elderly and disabled authorized by this subsection and any exemption for the elderly or disabled adopted pursuant to Subsection (b) of this section. Where ad valorem tax has previously been pledged for the payment of debt, the taxing officers of a school district may continue to levy and collect the tax against the value of homesteads exempted under this subsection until the debt is discharged if the cessation of the levy would impair the obligation of the contract by which the debt was created. The legislature shall provide for formulas to protect school districts against all or part of the revenue loss incurred by the implementation of this subsection, Subsection (d) of this section, and Section 1-d-1 of this article. The legislature by general law may define residence homestead for purposes of this section.

SECTION 3. (a) This section takes effect only if the constitutional amendment proposed by H.J.R. No. 125, 87th Legislature, Regular Session, 2021, is approved by the voters. If that amendment is not approved by the voters, this section has no effect.

(b) Section 1-b(d), Article VIII, Texas Constitution, is amended to read as follows:

(d) Except as otherwise provided by this subsection, if a person receives a residence homestead exemption prescribed by Subsection (c) of this section for homesteads of persons who are 65 years of age or older or who are disabled, the total amount of ad valorem taxes imposed on that homestead for general elementary and secondary public school purposes may not be increased while it remains the residence homestead of that person or that person's spouse who receives the exemption. If a person who is 65 years of age or older or who is disabled dies in a year in which the person received the exemption, the total amount of ad valorem taxes imposed on the homestead for general elementary and secondary public school purposes may not be increased while it remains the residence homestead of that person's surviving spouse if the spouse is 55 years of age or older at the time of the person's death, subject to any exceptions provided by general law. The legislature, by general law, may provide for the transfer of all or a proportionate amount of a limitation provided by this subsection for a person who qualifies for the limitation and establishes a different residence homestead. However, taxes otherwise limited by this subsection may be increased to the extent the value of the homestead is increased by improvements other than repairs or improvements made to comply with governmental requirements and except as may be consistent with the transfer of a limitation under this subsection. For a residence homestead subject to the limitation provided by this subsection in the 1996 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 1997 tax year and subsequent tax years in an amount equal to $10,000 multiplied by the 1997 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2014 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 2015 tax year and subsequent tax years in an amount equal to $10,000 multiplied by the 2015 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2022 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 2023 tax year in an amount equal to $80,000 multiplied by the 2023 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2023 tax year, the legislature shall provide for an increase in the amount of the limitation for the 2024 tax year and subsequent tax years in an amount equal to $80,000 multiplied by the 2023 tax rate for general elementary and secondary public school purposes applicable to the residence homestead.

SECTION 4. (a) This section takes effect only if the constitutional amendment proposed by H.J.R. No. 125, 87th Legislature, Regular Session, 2021, is not approved by the voters. If that amendment is approved by the voters, this section has no effect.

(b) Section 1-b(d), Article VIII, Texas Constitution, is amended to read as follows:

(d) Except as otherwise provided by this subsection, if a person receives a residence homestead exemption prescribed by Subsection (c) of this section for homesteads of persons who are 65 years of age or older or who are disabled, the total amount of ad valorem taxes imposed on that homestead for general elementary and secondary public school purposes may not be increased while it remains the residence homestead of that person or that person's spouse who receives the exemption. If a person 65 years of age or older dies in a year in which the person received the exemption, the total amount of ad valorem taxes imposed on the homestead for general elementary and secondary public school purposes may not be increased while it remains the residence homestead of that person's surviving spouse if the spouse is 55 years of age or older at the time of the person's death, subject to any exceptions provided by general law. The legislature, by general law, may provide for the transfer of all or a proportionate amount of a limitation provided by this subsection for a person who qualifies for the limitation and establishes a different residence homestead. However, taxes otherwise limited by this subsection may be increased to the extent the value of the homestead is increased by improvements other than repairs or improvements made to comply with governmental requirements and except as may be consistent with the transfer of a limitation under this subsection. For a residence homestead subject to the limitation provided by this subsection in the 1996 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 1997 tax year and subsequent tax years in an amount equal to $10,000 multiplied by the 1997 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2014 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 2015 tax year and subsequent tax years in an amount equal to $10,000 multiplied by the 2015 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2022 tax year or an earlier tax year, the legislature shall provide for a reduction in the amount of the limitation for the 2023 tax year in an amount equal to $80,000 multiplied by the 2023 tax rate for general elementary and secondary public school purposes applicable to the residence homestead. For a residence homestead subject to the limitation provided by this subsection in the 2023 tax year, the legislature shall provide for an increase in the amount of the limitation for the 2024 tax year and subsequent tax years in an amount equal to $80,000 multiplied by the 2023 tax rate for general elementary and secondary public school purposes applicable to the residence homestead.

SECTION 5. The following temporary provision is added to the Texas Constitution:

TEMPORARY PROVISION. (a) This temporary provision applies to the constitutional amendment proposed by the 87th Legislature, 3rd Called Session, 2021, to appropriate money from the economic stabilization fund to the foundation school fund and use the money to finance a temporary increase in the amount of the exemption of residence homesteads from ad valorem taxation by a school district and a temporary reduction in the amount of the limitation on school district ad valorem taxes imposed on the residence homesteads of the elderly or disabled to reflect the increased exemption amount.

(b) The amendments to Sections 1-b(c) and (d), Article VIII, of this constitution take effect for the tax year beginning January 1, 2023.

(c) This temporary provision expires January 1, 2024.

SECTION 6. This proposed constitutional amendment shall be submitted to the voters at an election to be held November 8, 2022. The ballot shall be printed to permit voting for or against the proposition: "The constitutional amendment to appropriate money from the economic stabilization fund to the foundation school fund and use the money to finance a temporary increase in the amount of the exemption of residence homesteads from ad valorem taxation by a school district and a temporary reduction in the amount of the limitation on school district ad valorem taxes imposed on the residence homesteads of the elderly or disabled to reflect the increased exemption amount."