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A BILL TO BE ENTITLED
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AN ACT
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relating to the calculation of the voter-approval tax rate for |
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certain taxing units. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. 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 |
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PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY |
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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 |
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AND OPERATIONS RATE x 1.08) + CURRENT DEBT RATE |
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; [or] |
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(B) for a municipality or county with a |
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population of less than 30,000 that is not a special taxing unit: |
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VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE |
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AND OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE + |
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UNUSED INCREMENT RATE) |
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; or |
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(C) for a taxing unit other than a special taxing |
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unit or a municipality or county described by Paragraph (B): |
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VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE |
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AND OPERATIONS RATE x 1.025 [1.035]) + (CURRENT DEBT |
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RATE + UNUSED INCREMENT RATE) |
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SECTION 2. 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 - LOST |
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PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY |
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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 MUNICIPALITY OR COUNTY |
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WITH A POPULATION OF LESS THAN 30,000 THAT IS NOT A |
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SPECIAL TAXING UNIT = (NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE x 1.035) + (CURRENT DEBT RATE + UNUSED |
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INCREMENT RATE - SALES TAX GAIN RATE) |
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or |
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VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER THAN |
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SPECIAL TAXING UNIT OR MUNICIPALITY OR COUNTY WITH A |
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POPULATION OF LESS THAN 30,000 THAT IS NOT A SPECIAL |
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TAXING UNIT = (NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE x 1.025 [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 x |
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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 MUNICIPALITY OR COUNTY |
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WITH A POPULATION OF LESS THAN 30,000 THAT IS NOT A |
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SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND |
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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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or |
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VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER THAN |
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SPECIAL TAXING UNIT OR MUNICIPALITY OR COUNTY WITH A |
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POPULATION OF LESS THAN 30,000 THAT IS NOT A SPECIAL |
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TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND OPERATIONS |
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EXPENSE x 1.025 [1.035]) / (CURRENT TOTAL VALUE - NEW |
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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 - LOST |
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PROPERTY LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY |
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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 x |
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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 MUNICIPALITY OR COUNTY |
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WITH A POPULATION OF LESS THAN 30,000 THAT IS NOT A |
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SPECIAL TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND |
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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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or |
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VOTER-APPROVAL TAX RATE FOR TAXING UNIT OTHER THAN |
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SPECIAL TAXING UNIT OR MUNICIPALITY OR COUNTY WITH A |
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POPULATION OF LESS THAN 30,000 THAT IS NOT A SPECIAL |
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TAXING UNIT = [(LAST YEAR'S MAINTENANCE AND OPERATIONS |
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EXPENSE x 1.025 [1.035]) / (CURRENT TOTAL VALUE - NEW |
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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 3. Section 26.042(a-2), Tax Code, as added by H.B. |
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30, Acts of the 89th Legislature, Regular Session, 2025, and |
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effective January 1, 2026, is amended to read as follows: |
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(a-2) The voter-approval tax rate the governing body of the |
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taxing unit may direct the designated officer or employee to |
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calculate under Subsection (a) is equal to the lesser of: |
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(1) the voter-approval tax rate calculated in the |
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manner provided for a special taxing unit; or |
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(2) the voter-approval tax rate calculated according |
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to the following applicable formula: |
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(A) for a municipality or county with a |
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population of less than 30,000 that is not a special taxing unit: |
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VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE X 1.035) + (CURRENT DEBT RATE + UNUSED INCREMENT |
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RATE + DISASTER RELIEF RATE) |
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; or |
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(B) for a taxing unit other than a municipality |
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or county described by Paragraph (A): |
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VOTER-APPROVAL TAX RATE = (NO-NEW-REVENUE MAINTENANCE AND |
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OPERATIONS RATE X 1.025 [1.035]) + (CURRENT DEBT RATE + UNUSED |
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INCREMENT RATE + DISASTER RELIEF RATE) |
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SECTION 4. This Act applies only to ad valorem taxes imposed |
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for an ad valorem tax year that begins on or after the effective |
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date of this Act. |
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SECTION 5. This Act takes effect January 1, 2026. |