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A BILL TO BE ENTITLED
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AN ACT
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relating to the appraisal for ad valorem tax purposes of certain |
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nonexempt property used for low-income or moderate-income housing. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 23.215, Tax Code, is amended to read as |
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follows: |
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Sec. 23.215. APPRAISAL OF CERTAIN NONEXEMPT PROPERTY USED |
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FOR LOW-INCOME OR MODERATE-INCOME HOUSING. (a) This section |
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applies only to real property owned by an organization: |
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(1) for the purpose of renting the property [that on |
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the effective date of this section was rented] to a low-income or |
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moderate-income individual or family satisfying the organization's |
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income eligibility requirements [and that continues to be used for |
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that purpose]; |
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(2) that was financed under the low income housing tax |
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credit program under Subchapter DD, Chapter 2306, Government Code, |
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and is subject to a land use restriction agreement under that |
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subchapter that has not expired or been terminated; |
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(3) that does not receive an exemption under Section |
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11.182 or 11.1825; and |
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(4) the owner of which has not entered into an |
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agreement with any taxing unit to make payments to the taxing unit |
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instead of taxes on the property. |
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(b) In appraising property that is under construction or |
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that has not reached stabilized occupancy on January 1 of the tax |
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year in which the property is appraised, the [The] chief appraiser |
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shall determine the appraised value of [appraise] the property in |
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the manner provided by Section 11.1825(q), provided that the chief |
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appraiser shall estimate the property's gross income potential and |
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operating expenses based on the property's projected income and |
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expenses for the first full year of operation as established and |
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utilized in the underwriting report pertaining to the property |
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prepared by the Texas Department of Housing and Community Affairs |
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under Subchapter DD, Chapter 2306, Government Code, adjusted as |
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provided by this subsection. For a property under construction on |
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January 1, the income and expenses contained in the underwriting |
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report shall be adjusted by multiplying those amounts by a |
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fraction, the denominator of which is the total construction budget |
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for the property and the numerator of which is the total amount |
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spent in constructing the property as of January 1. For a property |
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on which construction was completed but that has not reached |
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stabilized occupancy on January 1, the income and expenses |
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contained in the underwriting report shall be adjusted to reflect |
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the actual occupancy of the property on January 1. |
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(c) In appraising property for the first tax year following |
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the year in which construction on the property was completed and |
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occupancy of the property had stabilized and any tax year |
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subsequent to that year, the chief appraiser shall determine the |
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appraised value of the property in the manner provided by Section |
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11.1825(q). |
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SECTION 2. The change in law made by this Act applies only |
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to an ad valorem tax year that begins on or after January 1, 2022. |
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SECTION 3. This Act takes effect January 1, 2022. |