88R10899 LHC-D
 
  By: Miles S.B. No. 2131
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the treatment of a replacement structure for a
  structure that was rendered uninhabitable or unusable by a casualty
  or by wind or water damage as a new improvement for ad valorem tax
  purposes.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 11.26(o), Tax Code, is amended to read as
  follows:
         (o)  Notwithstanding Subsections (a), (a-3), and (b), an
  improvement to property that would otherwise constitute an
  improvement under Subsection (b) is not treated as an improvement
  under that subsection if the improvement is a replacement structure
  for a structure that was rendered uninhabitable or unusable by a
  casualty or by wind or water damage.  For purposes of appraising
  the property in the tax year in which the structure would have
  constituted an improvement under Subsection (b), the replacement
  structure is considered to be an improvement under that subsection
  only if[:
               [(1)]  the square footage of the replacement structure
  exceeds that of the replaced structure as that structure existed
  before the casualty or damage occurred[; or
               [(2)  the exterior of the replacement structure is of
  higher quality construction and composition than that of the
  replaced structure].
         SECTION 2.  Section 11.261(m), Tax Code, is amended to read
  as follows:
         (m)  Notwithstanding Subsections (b) and (c), an improvement
  to property that would otherwise constitute an improvement under
  Subsection (c) is not treated as an improvement under that
  subsection if the improvement is a replacement structure for a
  structure that was rendered uninhabitable or unusable by a casualty
  or by wind or water damage.  For purposes of appraising the
  property in the tax year in which the structure would have
  constituted an improvement under Subsection (c), the replacement
  structure is considered to be an improvement under that subsection
  only if[:
               [(1)]  the square footage of the replacement structure
  exceeds that of the replaced structure as that structure existed
  before the casualty or damage occurred[; or
               [(2)  the exterior of the replacement structure is of
  higher quality construction and composition than that of the
  replaced structure].
         SECTION 3.  Sections 23.23(f) and (g), Tax Code, are amended
  to read as follows:
         (f)  Notwithstanding Subsections (a) and (e) and except as
  provided by Subdivision (2), an improvement to property that would
  otherwise constitute a new improvement is not treated as a new
  improvement if the improvement is a replacement structure for a
  structure that was rendered uninhabitable or unusable by a casualty
  or by wind or water damage.  For purposes of appraising the
  property under Subsection (a) in the tax year in which the structure
  would have constituted a new improvement:
               (1)  the appraised value the property would have had in
  the preceding tax year if the casualty or damage had not occurred is
  considered to be the appraised value of the property for that year,
  regardless of whether that appraised value exceeds the actual
  appraised value of the property for that year as limited by
  Subsection (a); and
               (2)  the replacement structure is considered to be a
  new improvement only if[:
                     [(A)]  the square footage of the replacement
  structure exceeds that of the replaced structure as that structure
  existed before the casualty or damage occurred[; or
                     [(B)  the exterior of the replacement structure is
  of higher quality construction and composition than that of the
  replaced structure].
         (g)  In this subsection, "disaster recovery program" means
  the disaster recovery program administered by the General Land
  Office or by a political subdivision of this state that is funded
  with community development block grant disaster recovery money
  authorized by federal law.  Notwithstanding Subsection (f)(2), and
  only to the extent necessary to satisfy the requirements of the
  disaster recovery program, a replacement structure described by
  that subdivision is not considered to be a new improvement if to
  satisfy the requirements of the disaster recovery program it was
  necessary that [:
               [(1)]  the square footage of the replacement structure
  exceed that of the replaced structure as that structure existed
  before the casualty or damage occurred [; or
               [(2)  the exterior of the replacement structure be of
  higher quality construction and composition than that of the
  replaced structure].
         SECTION 4.  This Act applies only to ad valorem taxes imposed
  for a tax year beginning on or after the effective date of this Act.
         SECTION 5.  This Act takes effect January 1, 2024.