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A BILL TO BE ENTITLED
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AN ACT
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relating to the calculation of certain ad valorem tax rates of a |
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taxing unit and the manner in which a proposed ad valorem tax rate |
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that exceeds the voter-approval tax rate is approved; making |
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conforming changes. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 48.202(f), Education Code, is amended to |
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read as follows: |
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(f) For a school year in which the dollar amount guaranteed |
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level of state and local funds per weighted student per cent of tax |
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effort ("GL") under Subsection (a-1)(2) exceeds the dollar amount |
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guaranteed level of state and local funds per weighted student per |
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cent of tax effort ("GL") under Subsection (a-1)(2) for the |
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preceding school year, a school district shall reduce the |
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district's tax rate under Section 45.0032(b)(2) for the tax year |
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that corresponds to that school year to a rate that results in the |
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amount of state and local funds per weighted student per cent of tax |
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effort available to the district at the dollar amount guaranteed |
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level for the preceding school year. A school district is not |
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entitled to the amount equal to the increase of revenue described by |
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this subsection for the school year for which the district must |
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reduce the district's tax rate. For [Unless Section 26.042(e), Tax |
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Code, applies to the district, for] a tax year in which a district |
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must reduce the district's tax rate under this subsection, the |
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district may not increase the district's maintenance and operations |
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tax rate to a rate that exceeds the maximum maintenance and |
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operations tax rate permitted under Section 45.003(d) or (f), as |
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applicable, minus the reduction of tax effort required under this |
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subsection. This subsection does not apply if the amount of state |
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funds appropriated for a school year specifically excludes the |
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amount necessary to provide the dollar amount guaranteed level of |
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state and local funds per weighted student per cent of tax effort |
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under Subsection (a-1)(2). |
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SECTION 2. Section 3828.157, Special District Local Laws |
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Code, is amended to read as follows: |
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Sec. 3828.157. INAPPLICABILITY OF CERTAIN TAX CODE |
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PROVISIONS. Sections 26.04, [26.042,] 26.05, and 26.07, [and |
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26.075,] Tax Code, do not apply to a tax imposed under Section |
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3828.153 or 3828.156. |
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SECTION 3. Section 8876.152(a), Special District Local Laws |
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Code, is amended to read as follows: |
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(a) Sections 26.04, [26.042,] 26.05, 26.06, 26.061, and |
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26.07, [and 26.075,] Tax Code, do not apply to a tax imposed by the |
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district. |
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SECTION 4. Section 26.012(3), Tax Code, is amended to read |
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as follows: |
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(3) "Current debt service" means the minimum dollar |
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amount required to be expended for debt service for the current |
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year. |
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SECTION 5. Section 26.04(c), Tax Code, is amended to read as |
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follows: |
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(c) After the assessor for the taxing unit submits the |
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appraisal roll for the taxing unit to the governing body of the |
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taxing unit as required by Subsection (b), an officer or employee |
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designated by the governing body shall calculate the no-new-revenue |
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tax rate and the voter-approval tax rate for the taxing unit, where: |
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(1) "No-new-revenue tax rate" means a rate expressed |
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in dollars per $100 of taxable value calculated according to the |
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following formula: |
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NO-NEW-REVENUE TAX RATE = (LAST YEAR'S LEVY - LOST PROPERTY |
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LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE) |
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; and |
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(2) "Voter-approval tax rate" means a rate expressed |
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in dollars per $100 of taxable value calculated according to the |
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following [applicable] formula: |
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[(A) for a special taxing unit:] |
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VOTER-APPROVAL TAX RATE = [(]NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE [x 1.08)] + CURRENT DEBT RATE |
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[; or |
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[(B) for a taxing unit other than a special |
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taxing unit: |
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[VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE + UNUSED INCREMENT |
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RATE)] |
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SECTION 6. Sections 26.041(a), (b), and (c), Tax Code, are |
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amended to read as follows: |
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(a) In the first year in which an additional sales and use |
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tax is required to be collected, the no-new-revenue tax rate and |
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voter-approval tax rate for the taxing unit are calculated |
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according to the following formulas: |
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NO-NEW-REVENUE TAX RATE = [(LAST YEAR'S LEVY - |
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LOST PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW |
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PROPERTY VALUE)] - SALES TAX GAIN RATE |
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and |
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VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT] |
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= [(]NO-NEW-REVENUE MAINTENANCE AND OPERATIONS RATE [x |
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1.08)] + [(]CURRENT DEBT RATE - SALES TAX GAIN RATE[) |
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[or |
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[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER |
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THAN SPECIAL TAXING UNIT = (NO-NEW-REVENUE MAINTENANCE |
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AND OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE + |
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UNUSED INCREMENT RATE - SALES TAX GAIN RATE)] |
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where "sales tax gain rate" means a number expressed in dollars per |
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$100 of taxable value, calculated by dividing the revenue that will |
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be generated by the additional sales and use tax in the following |
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year as calculated under Subsection (d) by the current total value. |
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(b) Except as provided by Subsections (a) and (c), in a year |
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in which a taxing unit imposes an additional sales and use tax, the |
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voter-approval tax rate for the taxing unit is calculated according |
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to the following formula, regardless of whether the taxing unit |
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levied a property tax in the preceding year: |
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VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT] |
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= [[(]LAST YEAR'S MAINTENANCE AND OPERATIONS EXPENSE |
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[x 1.08)] / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] |
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+ (CURRENT DEBT RATE - SALES TAX REVENUE RATE) |
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[or |
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[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER |
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THAN SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE |
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AND OPERATIONS EXPENSE x 1.035) / (CURRENT TOTAL VALUE |
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- NEW PROPERTY VALUE)] + (CURRENT DEBT RATE + UNUSED |
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INCREMENT RATE - SALES TAX REVENUE RATE)] |
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where "last year's maintenance and operations expense" means the |
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amount spent for maintenance and operations from property tax and |
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additional sales and use tax revenues in the preceding year, and |
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"sales tax revenue rate" means a number expressed in dollars per |
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$100 of taxable value, calculated by dividing the revenue that will |
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be generated by the additional sales and use tax in the current year |
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as calculated under Subsection (d) by the current total value. |
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(c) In a year in which a taxing unit that has been imposing |
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an additional sales and use tax ceases to impose an additional sales |
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and use tax, the no-new-revenue tax rate and voter-approval tax |
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rate for the taxing unit are calculated according to the following |
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formulas: |
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NO-NEW-REVENUE TAX RATE = [(LAST YEAR'S LEVY - |
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LOST PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW |
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PROPERTY VALUE)] + SALES TAX LOSS RATE |
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and |
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VOTER-APPROVAL TAX RATE [FOR SPECIAL TAXING UNIT] |
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= [[(]LAST YEAR'S MAINTENANCE AND OPERATIONS EXPENSE |
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[x 1.08)] / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)] |
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+ CURRENT DEBT RATE |
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[or |
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[VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER |
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THAN SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE |
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AND OPERATIONS EXPENSE x 1.035) / (CURRENT TOTAL VALUE |
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- NEW PROPERTY VALUE)] + (CURRENT DEBT RATE + UNUSED |
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INCREMENT RATE)] |
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where "sales tax loss rate" means a number expressed in dollars per |
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$100 of taxable value, calculated by dividing the amount of sales |
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and use tax revenue generated in the last four quarters for which |
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the information is available by the current total value and "last |
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year's maintenance and operations expense" means the amount spent |
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for maintenance and operations from property tax and additional |
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sales and use tax revenues in the preceding year. |
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SECTION 7. Section 26.07(b), Tax Code, is amended to read as |
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follows: |
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(b) If the governing body of a [special] taxing unit [or a |
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municipality with a population of 30,000 or more] adopts a tax rate |
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that exceeds the taxing unit's voter-approval tax rate, [or the |
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governing body of a taxing unit other than a special taxing unit or |
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a municipality with a population of less than 30,000 regardless of |
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whether it is a special taxing unit adopts a tax rate that exceeds |
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the greater of the taxing unit's voter-approval tax rate or de |
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minimis rate,] the registered voters of the taxing unit at an |
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election held for that purpose must determine whether to approve |
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the adopted tax rate. |
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SECTION 8. Sections 31.12(a) and (b), Tax Code, are amended |
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to read as follows: |
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(a) If a refund of a tax provided by Section 11.431(b), |
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26.07(g), [26.075(k),] 26.15(f), 31.11, 31.111, or 31.112 is paid |
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on or before the 60th day after the date the liability for the |
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refund arises, no interest is due on the amount refunded. If not |
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paid on or before that 60th day, the amount of the tax to be refunded |
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accrues interest at a rate of one percent for each month or part of a |
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month that the refund is unpaid, beginning with the date on which |
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the liability for the refund arises. |
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(b) For purposes of this section, liability for a refund |
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arises: |
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(1) if the refund is required by Section 11.431(b), on |
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the date the chief appraiser notifies the collector for the taxing |
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|
unit of the approval of the late homestead exemption; |
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(2) if the refund is required by Section 26.07(g) [or |
|
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26.075(k)], on the date the results of the election to approve [or |
|
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reduce] the tax rate[, as applicable,] are certified; |
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(3) if the refund is required by Section 26.15(f): |
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(A) for a correction to the tax roll made under |
|
|
Section 26.15(b), on the date the change in the tax roll is |
|
|
certified to the assessor for the taxing unit under Section 25.25; |
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or |
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(B) for a correction to the tax roll made under |
|
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Section 26.15(c), on the date the change in the tax roll is ordered |
|
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by the governing body of the taxing unit; |
|
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(4) if the refund is required by Section 31.11, on the |
|
|
date the auditor for the taxing unit determines that the payment was |
|
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erroneous or excessive or, if the amount of the refund exceeds the |
|
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applicable amount specified by Section 31.11(a), on the date the |
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governing body of the taxing unit approves the refund; |
|
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(5) if the refund is required by Section 31.111, on the |
|
|
date the collector for the taxing unit determines that the payment |
|
|
was erroneous; or |
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|
(6) if the refund is required by Section 31.112, on the |
|
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date required by Section 31.112(d) or (e), as applicable. |
|
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SECTION 9. Section 33.08(b), Tax Code, is amended to read as |
|
|
follows: |
|
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(b) The governing body of the taxing unit or appraisal |
|
|
district, in the manner required by law for official action, may |
|
|
provide that taxes that become delinquent on or after June 1 under |
|
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Section [26.075(j),] 26.15(e), 31.03, 31.031, 31.032, 31.033, |
|
|
31.04, or 42.42 incur an additional penalty to defray costs of |
|
|
collection. The amount of the penalty may not exceed the amount of |
|
|
the compensation specified in the applicable contract with an |
|
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attorney under Section 6.30 to be paid in connection with the |
|
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collection of the delinquent taxes. |
|
|
SECTION 10. Section 49.057, Water Code, is amended by |
|
|
amending Subsection (b) and adding Subsection (j) to read as |
|
|
follows: |
|
|
(b) The board shall adopt an annual budget. The board of a |
|
|
developed district[, as defined by Section 49.23602,] shall include |
|
|
as an appendix to the budget the district's: |
|
|
(1) audited financial statements; |
|
|
(2) bond transcripts; and |
|
|
(3) engineer's reports required by Section 49.106. |
|
|
(j) In this section, "developed district" means a district |
|
|
that has financed, completed, and issued bonds to pay for all land, |
|
|
works, improvements, facilities, plants, equipment, and appliances |
|
|
necessary to serve at least 95 percent of the projected build-out of |
|
|
the district in accordance with the purposes for its creation or the |
|
|
purposes authorized by the constitution, this code, or any other |
|
|
law. |
|
|
SECTION 11. Section 49.107(g), Water Code, is amended to |
|
|
read as follows: |
|
|
(g) Sections 26.04, [26.042,] 26.05, 26.061, and 26.07, |
|
|
[and 26.075,] Tax Code, do not apply to a tax levied and collected |
|
|
under this section or an ad valorem tax levied and collected for the |
|
|
payment of the interest on and principal of bonds issued by a |
|
|
district. |
|
|
SECTION 12. Section 49.108(f), Water Code, is amended to |
|
|
read as follows: |
|
|
(f) Sections 26.04, [26.042,] 26.05, 26.061, and 26.07, |
|
|
[and 26.075,] Tax Code, do not apply to a tax levied and collected |
|
|
for payments made under a contract approved in accordance with this |
|
|
section. |
|
|
SECTION 13. Section 49.236(a), Water Code, is amended to |
|
|
read as follows: |
|
|
(a) Before the board adopts an ad valorem tax rate for the |
|
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district for debt service, operation and maintenance purposes, or |
|
|
contract purposes, the board shall give notice of each meeting of |
|
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the board at which the adoption of a tax rate will be considered. |
|
|
The notice must: |
|
|
(1) contain a statement in substantially the following |
|
|
form: |
|
|
"NOTICE OF PUBLIC HEARING ON TAX RATE |
|
|
"The (name of the district) will hold a public hearing on a |
|
|
proposed tax rate for the tax year (year of tax levy) on (date and |
|
|
time) at (meeting place). Your individual taxes may increase at a |
|
|
greater or lesser rate, or even decrease, depending on the tax rate |
|
|
that is adopted and on the change in the taxable value of your |
|
|
property in relation to the change in taxable value of all other |
|
|
property. The change in the taxable value of your property in |
|
|
relation to the change in the taxable value of all other property |
|
|
determines the distribution of the tax burden among all property |
|
|
owners. |
|
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"Visit Texas.gov/PropertyTaxes to find a link to your local |
|
|
property tax database on which you can easily access information |
|
|
regarding your property taxes, including information about |
|
|
proposed tax rates and scheduled public hearings of each entity |
|
|
that taxes your property. |
|
|
"(Names of all board members and, if a vote was taken, an |
|
|
indication of how each voted on the proposed tax rate and an |
|
|
indication of any absences.)"; |
|
|
(2) contain the following information: |
|
|
(A) the district's total adopted tax rate for the |
|
|
preceding year and the proposed tax rate, expressed as an amount per |
|
|
$100; |
|
|
(B) the difference, expressed as an amount per |
|
|
$100 and as a percent increase or decrease, as applicable, in the |
|
|
proposed tax rate compared to the adopted tax rate for the preceding |
|
|
year; |
|
|
(C) the average appraised value of a residence |
|
|
homestead in the district in the preceding year and in the current |
|
|
year; the district's total homestead exemption, other than an |
|
|
exemption available only to disabled persons or persons 65 years of |
|
|
age or older, applicable to that appraised value in each of those |
|
|
years; and the average taxable value of a residence homestead in the |
|
|
district in each of those years, disregarding any homestead |
|
|
exemption available only to disabled persons or persons 65 years of |
|
|
age or older; |
|
|
(D) the amount of tax that would have been |
|
|
imposed by the district in the preceding year on a residence |
|
|
homestead appraised at the average appraised value of a residence |
|
|
homestead in that year, disregarding any homestead exemption |
|
|
available only to disabled persons or persons 65 years of age or |
|
|
older; |
|
|
(E) the amount of tax that would be imposed by the |
|
|
district in the current year on a residence homestead appraised at |
|
|
the average appraised value of a residence homestead in that year, |
|
|
disregarding any homestead exemption available only to disabled |
|
|
persons or persons 65 years of age or older, if the proposed tax |
|
|
rate is adopted; |
|
|
(F) the difference between the amounts of tax |
|
|
calculated under Paragraphs (D) and (E), expressed in dollars and |
|
|
cents and described as the annual percentage increase or decrease, |
|
|
as applicable, in the tax to be imposed by the district on the |
|
|
average residence homestead in the district in the current year if |
|
|
the proposed tax rate is adopted; and |
|
|
(G) if the proposed combined debt service, |
|
|
operation and maintenance, and contract tax rate requires [or |
|
|
authorizes] an election to approve [or reduce] the tax rate, [as |
|
|
applicable,] a description of the purpose of the proposed tax |
|
|
increase; |
|
|
(3) contain a statement in substantially the following |
|
|
form[, as applicable: |
|
|
[(A) if the district is a district described by |
|
|
Section 49.23601]: |
|
|
"NOTICE OF VOTE ON TAX RATE |
|
|
"If the district adopts a combined debt service, operation |
|
|
and maintenance, and contract tax rate that would result in the |
|
|
taxes on the average residence homestead increasing from the |
|
|
preceding year [by more than eight percent], an election must be |
|
|
held to determine whether to approve the operation and maintenance |
|
|
tax rate under Section 49.23601, Water Code."; |
|
|
[(B) if the district is a district described by |
|
|
Section 49.23602: |
|
|
["NOTICE OF VOTE ON TAX RATE |
|
|
["If the district adopts a combined debt service, operation |
|
|
and maintenance, and contract tax rate that would result in the |
|
|
taxes on the average residence homestead increasing by more than |
|
|
3.5 percent, an election must be held to determine whether to |
|
|
approve the operation and maintenance tax rate under Section |
|
|
49.23602, Water Code."; or |
|
|
[(C) if the district is a district described by |
|
|
Section 49.23603: |
|
|
["NOTICE OF TAXPAYERS' RIGHT TO ELECTION TO REDUCE TAX RATE |
|
|
["If the district adopts a combined debt service, operation |
|
|
and maintenance, and contract tax rate that would result in the |
|
|
taxes on the average residence homestead increasing by more than |
|
|
eight percent, the qualified voters of the district by petition may |
|
|
require that an election be held to determine whether to reduce the |
|
|
operation and maintenance tax rate to the voter-approval tax rate |
|
|
under Section 49.23603, Water Code.";] and |
|
|
(4) include the following statement: "The 86th Texas |
|
|
Legislature modified the manner in which the voter-approval tax |
|
|
rate is calculated to limit the rate of growth of property taxes in |
|
|
the state.". |
|
|
SECTION 14. The heading to Section 49.23601, Water Code, is |
|
|
amended to read as follows: |
|
|
Sec. 49.23601. AUTOMATIC ELECTION TO APPROVE TAX RATE [FOR |
|
|
LOW TAX RATE DISTRICTS]. |
|
|
SECTION 15. Sections 49.23601(a) and (c), Water Code, are |
|
|
amended to read as follows: |
|
|
(a) In this section, "voter-approval tax rate" means the |
|
|
rate equal to the sum of the following tax rates for the district: |
|
|
(1) the current year's debt service tax rate; |
|
|
(2) the current year's contract tax rate; and |
|
|
(3) the operation and maintenance tax rate that would |
|
|
impose [1.08 times] the amount of [the] operation and maintenance |
|
|
tax imposed by the district in the preceding year on a residence |
|
|
homestead appraised at the average appraised value of a residence |
|
|
homestead in the district in that year, disregarding any homestead |
|
|
exemption available only to disabled persons or persons 65 years of |
|
|
age or older. |
|
|
(c) If the board of a district adopts a combined debt |
|
|
service, contract, and operation and maintenance tax rate that |
|
|
would impose more than [1.08 times] the amount of tax imposed by the |
|
|
district in the preceding year on a residence homestead appraised |
|
|
at the average appraised value of a residence homestead in the |
|
|
district in that year, disregarding any homestead exemption |
|
|
available only to disabled persons or persons 65 years of age or |
|
|
older, an election must be held in accordance with the procedures |
|
|
provided by Sections 26.07(c)-(g), Tax Code, to determine whether |
|
|
to approve the adopted tax rate. If the adopted tax rate is not |
|
|
approved at the election, the district's tax rate is the |
|
|
voter-approval tax rate. |
|
|
SECTION 16. The following provisions are repealed: |
|
|
(1) Section 45.0032(d), Education Code; |
|
|
(2) Section 120.007(d), Local Government Code; |
|
|
(3) Sections 26.012(8-a) and (19), Tax Code; |
|
|
(4) Section 26.013, Tax Code; |
|
|
(5) Section 26.042, Tax Code; |
|
|
(6) Section 26.0501(c), Tax Code; |
|
|
(7) Section 26.063, Tax Code; |
|
|
(8) Section 26.075, Tax Code; |
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(9) Section 49.23601(b), Water Code; |
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(10) Section 49.23602, Water Code; and |
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(11) Section 49.23603, Water Code. |
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SECTION 17. This Act applies only to ad valorem taxes |
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imposed for an ad valorem tax year that begins on or after the |
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effective date of this Act. |
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SECTION 18. This Act takes effect January 1, 2024. |