BILL ANALYSIS

 

 

Senate Research Center

H.B. 17

89S20040 CJC-D

By: Meyer (Bettencourt)

 

Local Government

 

8/26/2025

 

Engrossed

 

 

 

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

 

The property tax rate adoption process used by local taxing entities such as counties, cities, school districts, and special districts in Texas plays a critical role in determining the total tax burden levied on property owners. The bill author informed the House Committee on Ways and Means that, because current state law includes minimal notification requirements relating to proposed property tax rate changes, many taxpayers remain unaware of these changes and their financial implications and, further, that there is often low public participation in the rate-setting process, which raises concerns that local governments may adopt rates without sufficient public scrutiny. Moreover, the bill author informed the committee that advocates have called for stronger measures to increase transparency and ensure that taxpayers are better informed regarding how property tax decisions are made. 

 

H.B. 17 seeks to enhance transparency and encourage greater public involvement in the local property tax rate adoption process by revising requirements applicable to the notice of certain property tax-related information to be provided by taxing units and appraisal districts

 

H.B. 17 amends current law relating to the requirements regarding notice of certain property tax-related information to be provided by taxing units and appraisal districts.

 

RULEMAKING AUTHORITY

 

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

 

SECTION BY SECTION ANALYSIS

 

SECTION 1. Amends Section 44.004, Education Code, by amending Subsections (b), (e), (g-1), (i), and (j) and adding Subsections (c-3) and (c-4), as follows:

 

(b) Provides that the president of the school district board of trustees is required to mail, rather than provide for the publication of, notice of the budget and proposed tax rate meeting to each property owner in the district and is authorized to also publish the notice in a daily, weekly, or biweekly newspaper published in the district. Provides that, if no daily, weekly, or biweekly newspaper is published in the district, the president is authorized to publish, rather than required to provide for the publication of, notice in a newspaper, rather than at least one newspaper, of general circulation in the county in which the district's central administrative office is located. Requires that notice under this subsection be provided, rather than published, not earlier than the 30th day or later than the 10th day before the date of the hearing.

 

(c-3) Requires that the notice required by Subsection (c) (relating to the required specifications of the notice of public meeting to discuss and adopt the budget and the proposed tax rate) in addition to the information required by that subsection, include a certain statement. Sets forth the required language of the statement.

 

(c-4) Defines "adjusted collection rate," "adjusted tax collections," "enrollment growth rate," "inflation rate," and "preceding year's estimated levy."

 

(e) Provides that a person who owns taxable property in a school district is entitled to an injunction restraining the collection of taxes by the district if the district has not complied with the requirements of certain subsections, including Subsection (c-3), and the failure to comply was not in good faith.

 

(g-1)-(j) Makes conforming changes to these subsections.

 

SECTION 2. Amends Section 44.004(c), Education Code, as amended by S.B. 1453, Acts of the 89th Legislature, Regular Session, 2025, and effective January 1, 2026, to make a conforming change.

 

SECTION 3. Amends Section 44.0041(a), Education Code, to make a conforming change.

 

SECTION 4. Amends Sections 26.06(b-4) and (c), Tax Code, as follows:

 

(b-4) Requires that the notice of a public hearing, in addition to including the information described by certain subsections, as applicable, include the information described by Sections 26.062 and 26.0621, rather than Section 26.062.

 

(c) Provides that a taxing unit is required to mail the notice of a public hearing required under Section 26.06 (Notice, Hearing, and Vote on Tax Increase) to each property owner in the taxing unit, and is authorized to also publish the notice in a newspaper. Requires the taxing unit, rather than requires the taxing unit if the taxing unit publishes the notice in a newspaper, to also post the notice prominently on the home page of the Internet website of the taxing unit from the date the notice is first provided until the public hearing is concluded.

 

Deletes existing text authorizing the notice of a public hearing under this section to be delivered by mail to each property owner in the taxing unit or to be published in a newspaper. Makes a conforming change.

 

SECTION 5. Amends Section 26.061(c), Tax Code, to make a conforming change.

 

SECTION 6. Amends the heading to Section 26.062, Tax Code, to read as follows:

 

Sec. 26.062. ADDITIONAL INFORMATION REGARDING TAXES IMPOSED ON PROPERTIES TO BE INCLUDED IN TAX RATE NOTICE.

 

SECTION 7. Amends Chapter 26, Tax Code, by adding Section 26.0621, as follows:

 

Sec. 26.0621. ADDITIONAL INFORMATION REGARDING TAX COLLECTIONS TO BE INCLUDED IN TAX RATE NOTICE. (a) Defines "adjusted collection rate," "adjusted tax collections," "consumer price index," "inflation rate," "population growth rate," and "preceding year's estimated levy."

 

(b) Requires the Comptroller of Public Accounts of the State of Texas to determine the inflation rate that is required to be used by a taxing unit to make the computation required by this section and publish the rate in the Texas Register each year on July 1 or as soon thereafter as practicable.

 

(c) Requires a taxing unit, in addition to the information described by certain provisions of Section 26.06 (Notice, Hearing, and Vote on Tax Increase) or 26.061 (Notice of Meeting to Vote on Proposed Tax Rate That Does Not Exceed Lower of No-New-Revenue or Voter-Approval Tax Rate), as applicable, to include in the notice required by that provision one of certain statements that accurately describes the effect of the proposed tax rate. Sets forth the required language of the statements.

 

SECTION 8. Amends Section 26.17, Tax Code, by adding Subsection (b-1), as follows:

 

(b-1) Defines "adjusted tax collections," "enrollment growth rate," "inflation rate," and "population growth rate." Requires that the property tax database, in addition to the information required by Subsection (b) (relating to the requirements of the property tax database) of Section 26.17 (Database of Property-Tax-Related Information), include, with respect to each property that is listed on the appraisal roll for the appraisal district, a certain statement for each taxing unit other than a school district in which the property is located, and a certain statement for each school district in which the property is located. Sets forth the required language of the statements.

 

SECTION 9. Amends Section 49.236, Water Code, by adding Subsection (a-1) and amending Subsection (b), as follows:

 

(a-1) Defines "adjusted tax collections," "inflation rate," and "population growth rate." Requires that the notice required by Subsection (a) (relating to requiring the governing body of a district (board), before the board adopts an ad valorem tax rate for the district, to give notice of each meeting of the board at which the adoption of a tax rate will be considered) of Section 49.236 (Notice of Tax Hearing), in addition to the information required by that subsection, include a certain statement. Sets forth the required language of the statement.

 

(b) Provides that notice of the hearing is authorized, rather than required, to be published at least once in a newspaper having general circulation in the district at least seven days before the date of the hearing and, rather than or, required to be mailed to each owner of taxable property in the district, at the address for notice shown on the most recently certified tax roll of the district, at least 10 days before the date of the hearing. Makes a nonsubstantive change.

 

SECTION 10. Makes application of this Act prospective.

 

SECTION 11. Effective date: January 1, 2026.