By: Guillen H.B. No. 2432

A BILL TO BE ENTITLED

AN ACT

relating to ad valorem taxation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 1151.152, Occupations Code, is amended by adding Subsections (a) and (b) to read as follows:

Sec. 1151.152. ELIGIBILITY FOR REGISTRATION. (a) Subject to Subsection (b), to [To] be eligible for registration, an applicant must:

(1) be at least 18 years of age;

(2) reside in this state;

(3) be of good moral character;

(4) be a graduate of an accredited high school or establish high school graduation equivalency; and

(5) be actively engaged in appraisal, assessment, or collection.

(b) An applicant who is a person described by Section 1151.151(1) or (2), other than a chief appraiser of an appraisal district or a person who holds a license or certification as an appraiser under Chapter 1103, must, in addition to the requirements of Subsection (a), complete educational qualifications approved by the department that are substantially similar to the educational qualifications for licensing as an appraiser trainee under Chapter 1103.

SECTION 2. Section 403.302, Government Code, is amended by amending Subsection (a) and adding Subsection (b-1) to read as follows:

(a) The comptroller shall conduct a study using comparable sales and generally accepted auditing and sampling techniques to determine the total taxable value of all property in each school district. The study shall determine the taxable value of all property and of each category of property in the district and the productivity value of all land that qualifies for appraisal on the basis of its productive capacity and for which the owner has applied for and received a productivity appraisal. In each study, the comptroller shall determine the taxable value of every category of property in the district. The comptroller may not decline to study a category of property unless the district does not have any property in that category. The comptroller shall make appropriate adjustments in the study to account for actions taken under Chapter 49, Education Code.

(b-1) If the comptroller conducts a physical inspection of a property in connection with a study, the appraisal district that appraises property for the school district is entitled to have a representative present during the inspection. The comptroller must provide notice of the inspection to the appraisal district not later than the 14th day before the date the inspection occurs.

SECTION 3. Section 1.111, Tax Code, is amended by amending Subsection (d) and adding Subsection (d-1) to read as follows:

(d) Except as provided by Subsection (d-1), a [A] property owner may not designate more than one agent to represent the property owner in connection with an item of property. The designation of an agent in connection with an item of property revokes any previous designation of an agent in connection with that item of property.

(d-1) A property owner may designate a different agent to represent the property owner in connection with an item of property in a different tax year without revoking any previous designation of an agent in connection with the same item of property in a previous tax year.

SECTION 4. Section 5.07, Tax Code, is amended by adding Subsection (k) to read as follows:

(k) The comptroller shall prescribe the form that an appraisal review board shall use to make a determination required to be made by written order under this title. The form must require an appraisal review board to include for the property subject to the order the property owner's name, the property's identification number, the property's legal description and physical address, and any other information the comptroller determines necessary. The comptroller shall post the form on the comptroller's Internet website.

SECTION 5. Section 6.052, Tax Code, is amended by adding Subsection (a-1) to read as follows:

(a-1) Notwithstanding the requirements of Subsection (a), the chief appraiser of an appraisal district shall designate an independent ombudsman to provide free assistance to property owners who are 65 years of age or older in connection with motions to correct an appraisal roll Section 25.25, or protests under Subchapter C, Chapter 41.

SECTION 6. Section 11.161, Tax Code, is amended by adding Subsections (c) and (d) to read as follows:

(c) For purposes of Subsection (a), farm or ranch products may be produced by hydroponic farming.

(d) For purposes of Subsection (a), buildings and greenhouses used for the growth or production of hydroponic farming products at a hydroponic farm facility are considered to be implements of husbandry.

SECTION 7. Section 11.24, Tax Code, is amended by adding Subsection (c) to read as follows:

(c) For purposes of a structure or archeological site and land subject to an exemption under this section, the property owner may protest the appraised value of the structure or archeological site and the appraised value of the land separately. A property owner may protest the allocation of appraised value between the structure or archeological site and the land.

SECTION 8. Section 11.43(i), Tax Code, is amended to read as follows:

(i) If the chief appraiser discovers that an exemption that is not required to be claimed annually has been erroneously allowed in any one of the three [five] preceding years for real property, or in either of the two preceding years for personal property, the chief appraiser shall add the property or appraised value that was erroneously exempted for each year to the appraisal roll as provided by Section 25.21 of this code for other property that escapes taxation. If an exemption that was erroneously allowed did not apply to all taxing units in which the property was located, the chief appraiser shall note on the appraisal records, for each prior year, the taxing units that gave the exemption and are entitled to impose taxes on the property or value that escaped taxation.

SECTION 9. Section 11.4391(b), Tax Code, is amended to read as follows:

(b) If the application is approved, the property owner is liable to each taxing unit allowing the exemption for a penalty in an amount equal to 10 percent of the difference between the amount of tax imposed by the taxing unit on the inventory or property, a portion of which consists of freeport goods, and the amount that would otherwise have been imposed up to a maximum penalty of 10 percent of the tax imposed with the exemption.

SECTION 10. Subchapter C, Chapter 11, Tax Code, is amended by adding Section 11.4392 to read as follows:

Sec. 11.4392. LATE APPLICATION FOR PROPERTY EXEMPTED FROM TAXATION BY AGREEMENT. The chief appraiser shall accept and approve or deny an application for an exemption a person is entitled to receive under Section 11.28 or an agreement entered into under Chapter 312 after the deadline for filing it has passed if it is filed on or before June 15.

SECTION 11. Section 21.10(b), Tax Code, is amended to read as follows:

(b) If the application is approved, the property owner is liable to each taxing unit for a penalty in an amount equal to 10 percent of the difference between the amount of tax imposed by the taxing unit on the property without the allocation and the amount of tax imposed on the property with the allocation up to a maximum penalty of 10 percent of the tax imposed with the allocation.

SECTION 12. Section 22.27(a), Tax Code, is amended to read as follows:

(a) Rendition statements, real and personal property reports, attachments to those statements and reports, and other information the owner of property provides to the appraisal office in connection with the appraisal of the property, including income and expense information related to a property filed with an appraisal office and information voluntarily disclosed to an appraisal office or the comptroller about real or personal property sales prices [after a promise it will be held confidential], are confidential and not open to public inspection. The statements and reports and the information they contain about specific real or personal property or a specific real or personal property owner and information voluntarily disclosed to an appraisal office about real or personal property sales prices [after a promise it will be held confidential] may not be disclosed to anyone other than an employee of the appraisal office who appraises property except as authorized by Subsection (b) of this section.

SECTION 13. Section 22.28, Tax Code, is amended by amending the title and Subsections (a) and (b) to read as follows:

Sec. 22.28 PENALTY FOR DELINQUENT RENDITION OR REPORT; PENALTY COLLECTION PROCEDURES. (a) Except as otherwise provided by Section 22.30, the chief appraiser shall impose a penalty on a person who fails to timely file a rendition statement or property report required by this chapter in an amount equal to five [10] percent of the total amount of taxes imposed on the property for that year by taxing units participating in the appraisal district. The chief appraiser shall deliver by first class mail a notice of the imposition of the penalty to the person. The notice may be delivered with, but not included in, a notice of appraised value provided under Section 25.19, if practicable.

(b) The chief appraiser shall certify to the assessor for each taxing unit participating in the appraisal district that imposes taxes on the property that a penalty imposed under this chapter has become final. The assessor shall add the amount of the penalty to the original amount of tax imposed on the property and shall include the penalty as a separate line item entitled "PENALTY FOR DELINQUENT RENDITION OR REPORT"that amount in the tax bill for that year. The penalty becomes part of the tax on the property and is secured by the tax lien that attaches to the property under Section 32.01.

SECTION 14. Section 22.30, Tax Code, is amended by adding Subsection (a-2) to read as follows:

(a-2) The chief appraiser shall waive the penalty imposed by Section 22.28 if the property owner has not previously filed a delinquent rendition statement or property report for that parcel of property.

SECTION 15. Section 23.01, Tax Code, is amended by amending Subsection (f) and adding Subsection (d-1) to read as follows:

(d-1) The market value of a residential property or vacant lot that is adjacent only to other residential properties, or a combination of residential properties and vacant lots, shall be determined solely on the basis of the property's value as a residential property, regardless of whether:

(1) the property could legally be used for another purpose; or

(2) the residential use of the property is considered to be the highest and best use of the property.

(f) The selection of comparable properties and the application of appropriate adjustments for the determination of an appraised value of property by any person under Section 41.43(b)(3) or (4) or 42.26(a)(3) or (4) must be based on the application of generally accepted appraisal methods and techniques. Adjustments must be based on recognized methods and techniques that are necessary to produce a credible opinion.

SECTION 16. Section 23.51(2), Tax Code, is amended to read as follows:

(2) "Agricultural use" includes but is not limited to the following activities: cultivating the soil, producing crops for human food, animal feed, or planting seed or for the production of fibers; floriculture, viticulture, and horticulture; raising or keeping livestock; raising or keeping exotic animals for the production of human food or of fiber, leather, pelts, or other tangible products having a commercial value; planting cover crops or leaving land idle for the purpose of participating in a governmental program, provided the land is not used for residential purposes or a purpose inconsistent with agricultural use; and planting cover crops or leaving land idle in conjunction with normal crop or livestock rotation procedure. The term also includes the use of land to produce or harvest logs and posts for the use in constructing or repairing fences, pens, barns, or other agricultural improvements on adjacent qualified open-space land having the same owner and devoted to a different agricultural use. The term also includes the use of land for wildlife management. The term also includes the use of land to raise or keep bees for pollination or for the production of human food or other tangible products having a commercial value, provided that the land used is not less than 5 or more than 20 acres. The term also includes the use of land for hydroponic farming.

SECTION 17. Section 23.52, Tax Code, is amended by adding Subsection (h) to read as follows:

(h) The chief appraiser may appraise a portion of a parcel of land according to this chapter if the portion qualifies for appraisal under this subchapter but the remainder of the parcel does not.

SECTION 18. Subchapter D, Chapter 23, Tax Code, is amended by adding Section 23.527 to read as follows:

Sec. 23.527. ELIGIBILITY OF LAND PREVIOUSLY DEVOTED TO SOLAR OR WIND POWER FACILITY. (a) In this section:

(1) "Solar power facility" has the meaning assigned by Section 302.0001, Utilities Code.

(2) "Wind power facility" has the meaning assigned by Section 301.0001, Utilities Code.

(b) This section applies only to land:

(1) that was previously appraised as qualified open-space land as provided by this subchapter;

(2) that became ineligible for appraisal as provided by this subchapter due to a change of use caused by the development of a solar power facility or a wind power facility on the land;

(3) on which the solar power facility or wind power facility described by Subdivision (2) is no longer in operation; and

(4) that is currently devoted principally to agricultural use to the degree of intensity generally accepted in the area.

(c) Notwithstanding any other provision of this subchapter, land described by Subsection (b) is qualified open-space land.

SECTION 19. Section 25.19(f), Tax Code, is amended to read as follows:

(f) In the notice of appraised value for real property, the chief appraiser shall list separately:

(1) the market value of the land; [and]

(2) the market value of each structure and other improvement identified in the notice; and

(3) the total market value of the structures and other improvements on the property.

SECTION 20. Section 25.25, Tax Code, is amended by adding Subsection (q) to read as follows:

(q) An appraisal review board shall issue a written order under this section using the form prescribed by the comptroller under Section 5.07(k).

SECTION 21. Chapter 25, Tax Code, is amended by adding Section 25.255 to read as follows:

Sec. 25.255. EXACT CORRECTION OF ROLL. A chief appraiser that corrects the appraisal roll to include the appraised value of property, including as determined by an appraisal review board under Chapter 25.25 or Chapter 41, or a district court under Chapter 42, must correct the roll to show the exact dollar amount of the new appraised value.

SECTION 22. Section 26.09, Tax Code, is amended by amending Subsection (d) and adding Subsection (d-3) to read as follows:

(d) If a property is subject to taxation for a prior year in which it escaped taxation, the assessor shall calculate the tax for each year separately. In calculating the tax, the assessor shall use the assessment ratio and tax rate in effect in the taxing unit for the year for which back taxes are being imposed. Except as provided by Subsections [Subsection] (d-1) and (d-3), the amount of back taxes due incurs interest calculated at the rate provided by Section 33.01(c) from the date the tax would have become delinquent had the tax been imposed in the proper tax year.

(d-3) Back taxes assessed under Subsection (d) on property a chief appraiser discovers was omitted from an appraisal roll under Section 25.21 do not incur interest as required by Subsection (d).

SECTION 23. Section 26.17(b) and (e), Tax Code, are amended to read as follows:

(b) The database must include, with respect to each property listed on the appraisal roll for the appraisal district:

(1) the property's identification number;

(2) the property's market value;

(3) the market value of each structure and other improvement located on the property that is identified in the notice of appraised value under Section 25.19;

(4) the property's taxable value;

(5) [(4)] the name of each taxing unit in which the property is located;

(6) [(5)] for each school district in which the property is located:

(A) the no-new-revenue tax rate; and

(B) the voter-approval tax rate;

(7) [(6)] for each school district in which the property is located:

(A) the tax rate that would maintain the same amount of state and local revenue per student that the district received in the school year beginning in the preceding tax year; and

(B) the voter-approval tax rate;

(8) [(7)] the tax rate proposed by the governing body of each taxing unit in which the property is located;

(9) [(8)] for each taxing unit other than a school district in which the property is located, the taxes that would be imposed on the property if the taxing unit adopted a tax rate equal to:

(A) the no-new revenue tax rate; and

(B) the proposed tax rate;

(10) [(9)] for each school district in which the property is located, the taxes that would be imposed on the property if the district adopted a tax rate equal to:

(A) the tax rate that would maintain the same amount of state and local revenue per student that the district received in the school year beginning in the preceding tax year; and

(B) the proposed tax rate;

(11) [(10)] for each taxing unit other than a school district in which the property is located, the difference between the amount calculated under Subdivision (9)(A) [(8)(A)] and the amount calculated under Subdivision (9)(B) [(8)(B)];

(12) [(11)] for each school district in which the property is located, the difference between the amount calculated under Subdivision (10)(A) [(9)(A)] and the amount calculated under Subdivision (10)(B) [(9)(B)];

(13) [(12)] the date, time, and location of the public hearing, if applicable, on the proposed tax rate to be held by the governing body of each taxing unit in which the property is located;

(14) [(13)] the date, time, and location of the public meeting, if applicable, at which the tax rate will be adopted to be held by the governing body of each taxing unit in which the property is located; and

(15) [(14)] for each taxing unit in which the property is located, an e-mail address at which the taxing unit is capable of receiving written comments regarding the proposed tax rate of the taxing unit.

(e) The officer or employee designated by the governing body of each taxing unit in which the property is located to calculate the no-new-revenue tax rate and the voter-approval tax rate for the taxing unit must electronically incorporate into the database:

(1) the information described by Subsections (b)(6) [(b)(5), (6)], (7), (8), [(12), and] (13), and (14), as applicable, as the information becomes available; and

(2) the tax rate calculation forms prepared under Section 26.04(d-1) at the same time the designated officer or employee submits the tax rates to the governing body of the taxing unit under Section 26.04(e).

SECTION 24. Section 31.01(c), Tax Code, is amended to read as follows:

(c) The tax bill or a separate statement accompanying the tax bill shall:

(1) identify the property subject to the tax;

(2) state the appraised value, assessed value, and taxable value of the property, which must be exact and not rounded numbers;

(3) if the property is land appraised as provided by Subchapter C, D, E, or H, Chapter 23, state the market value and the taxable value for purposes of deferred or additional taxation as provided by Section 23.46, 23.55, 23.76, or 23.9807, as applicable;

(4) state the assessment ratio for the unit;

(5) state the type and amount of any partial exemption applicable to the property, indicating whether it applies to appraised or assessed value;

(6) state the total tax rate for the unit;

(7) state the amount of tax due, the due date, and the delinquency date;

(8) explain the payment option and discounts provided by Sections 31.03 and 31.05, if available to the unit's taxpayers, and state the date on which each of the discount periods provided by Section 31.05 concludes, if the discounts are available;

(9) state the rates of penalty and interest imposed for delinquent payment of the tax;

(10) include the name and telephone number of the assessor for the unit and, if different, of the collector for the unit;

(11) for real property, state for the current tax year and each of the preceding five tax years:

(A) the appraised value and taxable value of the property;

(B) the total tax rate for the unit;

(C) the amount of taxes imposed on the property by the unit; and

(D) the difference, expressed as a percent increase or decrease, as applicable, in the amount of taxes imposed on the property by the unit compared to the amount imposed for the preceding tax year; [and]

(12) for real property, state the differences, expressed as a percent increase or decrease, as applicable, in the following for the current tax year as compared to the fifth tax year before that tax year:

(A) the appraised value and taxable value of the property;

(B) the total tax rate for the unit; and

(C) the amount of taxes imposed on the property by the unit; and

(13) include the appraisal district account number for the property.

SECTION 25. Section 33.41, Tax Code, is amended by amending Subsection (a) and adding Subsection (a-1) to read as follows:

Sec. 33.41. SUIT TO COLLECT DELINQUENT TAX. (a) Except as provided by Subsection (a-1), at [At] any time after its tax on property becomes delinquent, a taxing unit may file suit to foreclose the lien securing payment of the tax, to enforce personal liability for the tax, or both. The suit must be in a court of competent jurisdiction for the county in which the tax was imposed.

(a-1) A taxing unit may not file suit under Subsection (a) to collect a delinquent tax owed on a property that is the subject of a pending motion filed under Section 25.25(c).

SECTION 26. Section 41.07(a), Tax Code, is amended to read as follows:

(a) The appraisal review board shall determine each challenge and make its decision by written order using the form prescribed by the comptroller under Section 5.07(k). The appraisal review board shall issue a written order to the property owner immediately upon its determination of the property owner's challenge.

SECTION 27. Section 41.43(b), Tax Code, is amended to read as follows:

(b) A protest on the ground of unequal appraisal of property shall be determined in favor of the protesting party unless the appraisal district establishes that:

(1) the appraisal ratio of the property is equal to or less than the median level of appraisal of a reasonable and representative sample of other properties in the appraisal district;

(2) the appraisal ratio of the property is equal to or less than the median level of appraisal of a sample of properties in the appraisal district consisting of a reasonable number of other properties similarly situated to, or of the same general kind or character as, the property subject to the protest; [or]

(3) the appraised value of the property is equal to or less than the median appraised value of a reasonable number of comparable properties, appropriately adjusted; or

(4) the appraised value of the property is equal to or less than 110 percent of the appraised value of the comparable property, appropriately adjusted, with the lowest appraised value.

SECTION 28. Section 41.45(b), Tax Code, is amended to read as follows:

(b) A property owner initiating a protest is entitled to appear in-person to offer evidence or argument, and may not be denied a hearing at which the property owner and chief appraiser are both present in-person. A property owner may offer evidence or argument by affidavit without personally appearing and may appear by telephone conference call or videoconference to offer argument. A property owner who appears by telephone conference call or videoconference must offer any evidence by affidavit. A property owner must submit an affidavit described by this subsection to the board hearing the protest before the board begins the hearing on the protest. On receipt of an affidavit, the board shall notify the chief appraiser. The chief appraiser may inspect the affidavit and is entitled to a copy on request.

SECTION 29. Section 41.47(a), Tax Code, is amended to read as follows:

(a) The appraisal review board hearing a protest shall determine the protest and make its decision by written order using the form prescribed by the comptroller under Section 5.07(k).

SECTION 30. Section 41.66(i), Tax Code, is amended to read as follows:

(i) A hearing on a protest filed by a property owner or the designated agent of the owner shall be set for a time and date certain. If the hearing is not commenced within two hours of the time set for the hearing, the appraisal review board shall postpone the hearing on the request of the property owner or the designated agent of the owner. If the property owner or the designated agent of the owner does not request that the hearing be postponed, the appraisal review board shall hold the hearing at the earliest possible time but not later than 24 hours after the time for which the hearing was originally set.

SECTION 31. Section 41.67, Tax Code, is amended by adding Subsection (f) to read as follows:

(f) A property owner may submit evidence electronically at any point before or during a hearing.

SECTION 32. Section 41A.09, Tax Code, is amended by adding Subsection (f) to read as follows:

(f) The arbitrator may not determine the appraised value of the property that is the subject of an arbitration to be an amount greater than the appraised value of the property as shown in the appraisal records submitted to the appraisal review board by the chief appraiser under Section 25.22 or 25.23, except as requested and agreed to by the property owner.

SECTION 33. Section 42.01, Tax Code, is amended by adding Subsection (d) to read as follows:

(d) Notwithstanding Subsection (a), a person who owned property at any time during a tax year but no longer owns the property is entitled to file an appeal under this chapter as if the person were the current owner of the property, regardless of whether the person is the person subject to an order described by that subsection.

SECTION 34. Section 42.21, Tax Code, is amended by amending Subsections (a), (b), and (c) and adding Subsections (a-1) and (a-2) to read as follows:

(a) A party who appeals as provided by this chapter must file a petition for review with the district court not later than the later of:

(1) the 60th day [within 60 days] after the date the party receives [received] notice that a final order has been entered from which the [an] appeal may be had; or

(2) September 1 of the year in which the final order is entered [at any time after the hearing but before the 60-day deadline].

(a-1) Subject to Subsection (a), a party may file a petition for review under this section at any time after:

(1) the protest hearing, regardless of whether the party has received notice that a final order has been entered;

(2) notifying the appraisal review board that the chief appraiser and the party have agreed to a disposition of the protest and requesting the board to issue an agreed order under Section 41.47(g) or (g-1); or

(3) submitting an affidavit to the board hearing the protest under Section 41.45(b).

(a-2) Failure to timely file a petition bars any appeal under this chapter.

(b) [A petition for review brought under Section 42.02 must be brought against the owner of the property involved in the appeal.] A petition for review brought under Section 42.031 must be brought against the appraisal district and against the owner of the property involved in the appeal. A petition for review brought under Section 42.01(a)(2) or 42.03 must be brought against the comptroller. Any other petition for review under this chapter must be brought against the appraisal district. A petition for review may not be brought against the appraisal review board. An appraisal district may hire an attorney that represents the district to represent the appraisal review board established for the district to file an answer and obtain a dismissal of a suit filed against the appraisal review board in violation of this subsection.

(c) If an appeal under this chapter is pending when the appraisal review board issues an order in a subsequent year under a protest by the same property owner and that protest relates to the same property that is involved in the pending appeal, the property owner may appeal the subsequent appraisal review board order by amending the original petition for the pending appeal to include the grounds for appealing the subsequent order. The amended petition must be filed with the court not later than the 90th day after the date the property owner receives notice that a final order has been entered from which an appeal may be had [in the period provided by Subsection (a) for filing a petition for review of the subsequent order]. A property owner may appeal the subsequent appraisal review board order under this subsection or may appeal the order independently of the pending appeal as otherwise provided by this section, but may not do both. A property owner may change the election of remedies provided by this subsection at any time before the end of the period provided by Subsection (a) for filing a petition for review.

SECTION 35. Section 42.225, Tax Code, is amended by amending the title and adding subsection (g) to read as follows:

Sec. 42.225 PROPERTY OWNER'S RIGHT TO APPEAL THROUGH ARBITRATION AND SOAH.

(g) If within one year of the filing of an appeal in district court, the court dismisses the appeal on a basis other than a plea to the jurisdiction or the court sets the case for trial and will not grant a continuance for a period of at least four months, the property owner may file an appeal at the State Office of Administrative Hearings (SOAH) or file for Binding Arbitration without regard to the jurisdiction limits.

SECTION 36. Section 42.226, Tax Code, is amended to read as follows:

Sec. 42.226. MEDIATION. (a) On motion by a party to an appeal under this chapter, the court shall enter an order requiring the parties to attend mediation. The court may enter an order requiring the parties to attend mediation on its own motion.

(b) The court may not order mediation to be completed more than 45 days before the first day of trial.

(c) The court may not order the parties to attend more than one mediation.

SECTION 37. Section 42.23, Tax Code, is amended by amending Subsection (e) and adding Subsections (a-1), (a-2), (i), (j), (k), (l), (m), and (n), to read as follows:

(a-1) A chief appraiser, appraisal district, or appraisal review board may not bring a counterclaim in an appeal brought under this chapter.

(a-2) An appraisal district may not seek affirmative relief in an appeal brought under this chapter.

(e) For purposes of Subsection (d), a property owner may designate a cause of action under Section 42.25 or 42.26 as the basis for an appeal, but may not designate a cause of action under both sections as the basis for the appeal. Discovery regarding a cause of action that is not specifically designated by the property owner under Subsection (d) shall be conducted as provided by the Texas Rules of Civil Procedure. [A court may not enter an order, including a protective order under Rule 192.6 of the Texas Rules of Civil Procedure, that conflicts with Subsection (d).]

(i) An entity is not required to be registered to do business in this state in order to file an appeal under this chapter or to be considered a proper party to bring a petition. A formal or informal request for information regarding an entity's registration status:

(1) is outside the scope of permissible discovery in an appeal under this chapter;

(2) may not be made a prerequisite to a settlement discussion related to that appeal; and

(3) may be grounds for sanctions by the court on the motion of a party.

(j) A court may not enter an order, including a protective order under Rule 192.6 of the Texas Rules of Civil Procedure, that conflicts with this section.

(k) The district court may not order discovery unless discovery is requested by a party to the appeal and the court determines there is good cause for discovery.

(l) Except as provided by Section 42.227 or by agreement of the parties, the following deadlines apply to an appeal under this chapter:

(1) the discovery period ends on the 30th day before the date of trial;

(2) a party seeking affirmative relief must designate testifying expert witnesses, other than rebuttal testifying expert witnesses, and provide the information listed in Rule 195.5 of the Texas Rules of Civil Procedure not later than the 90th day before the date of trial; and

(3) any other party must designate testifying expert witnesses, other than rebuttal testifying expert witnesses, and provide the information listed in Rule 195.5 of the Texas Rules of Civil Procedure not later than the 60th day before the date of trial.

(m) A party to an appeal under this chapter may file an objection to third-party discovery. The court shall grant third-party discovery subject to the objection only if the discovery:

(1) is necessary under generally accepted appraisal methods and techniques to determine the value of the property that is the subject of the appeal; and

(2) would be admissible at trial.

(n) A party to an appeal under Section 42.26 may file an objection to a discovery request for a closing statement, a rent roll, or an operating statement. The court shall grant the discovery request subject to the objection only if the discovery:

(1) is necessary under generally accepted appraisal methods and techniques to determine the value of the property that is the subject of the appeal; and

(2) would be admissible at trial.

SECTION 38. Subchapter B, Chapter 42, Tax Code, is amended by adding Sections 42.232 and 42.233 to read as follows:

Sec. 42.232. TRIAL DATE. (a) A district court may not set a trial date on an appeal that is less than 12 months after the date the appeal is filed, unless the parties agree to an earlier trial date.

(b) On request of a party to an appeal, the district court shall:

(1) grant a continuance if the party requesting the continuance has not previously been granted a continuance;

(2) set a new trial date that is not less than six months after the date for which the trial was set at the time the request was made; and

(3) extend all litigation, expert witness designation, and discovery deadlines consistent with section 42.23(l) or as agreed by the parties.

(c) The district court may grant additional trial continuances at the court's discretion.

Sec. 42.233. TRANSFER OF APPEAL TO STATE OFFICE OF ADMINISTRATIVE HEARINGS. On request of a property owner who is a party to an appeal under this chapter and who was eligible to file the appeal under Subchapter Z, Chapter 2003, Government Code, the district court shall transfer the appeal to the State Office of Administrative Hearings to determine the appeal under that subchapter. The property owner must make the request not later than the 30th day before the date on which the trial is originally set to begin.

SECTION 39. Section 42.26, Tax Code, is amended by amending Subsection (a) and adding Subsections (e) and (f) to read as follows:

(a) The district court shall grant relief on the ground that a property is appraised unequally if:

(1) the appraisal ratio of the property exceeds by at least 10 percent the median level of appraisal of a reasonable and representative sample of other properties in the appraisal district;

(2) the appraisal ratio of the property exceeds by at least 10 percent the median level of appraisal of a sample of properties in the appraisal district consisting of a reasonable number of other properties similarly situated to, or of the same general kind or character as, the property subject to the appeal; [or]

(3) the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties, appropriately adjusted; or

(4) the appraised value of the property exceeds by at least 10 percent the appraised value of the comparable property, appropriately adjusted, with the lowest appraised value.

(e) A district court may not determine the appraised value of the property that is subject to an appeal under this section to be an amount greater than the appraised value of the property as shown in the appraisal records submitted to the board by the chief appraiser under Section 25.22 or 25.23.

(f) If a claim that a property is appraised unequally is the sole cause of action in an appeal, the appraisal district may not request through discovery financial information related to the property, including a rent roll or appraisal.

SECTION 40. Section 42.41(b), Tax Code, is amended to read as follows:

(b) The assessor for each affected taxing unit shall correct the tax roll and other appropriate records for which the assessor is responsible. The assessor must correct the tax roll to indicate the exact dollar amount of the corrected value.

SECTION 41. Sections 42.43(b-1), (f), and (g), Tax Code, are amended to read as follows:

(b-1) A taxing unit may not send a refund made under this section before the earlier of:

(1) the 60th [21st] day after the final determination of the appeal; or

(2) the date the property owner files the form prescribed by Subsection (i) with the taxing unit.

(f) The final judgment in an appeal under this chapter shall [may] designate to whom and where a refund is to be sent if the property owner or the property owner's agent designated under Section 1.111 files the form required under Subsection (i).

(g) If a form prescribed by the comptroller under Subsection (i) is filed with a taxing unit before the 60th [21st] day after the final determination of an appeal that requires a refund be made, the taxing unit shall send the refund to the person and address designated on the form.

SECTION 42. Section 42.02, Tax Code, is repealed.

SECTION 43. As soon as practicable after the effective date of this Act, the Texas Commission of Licensing and Regulation shall adopt rules necessary to implement Section 1151.152, Occupations Code, as amended by this Act.

SECTION 44. Section 1151.152, Occupations Code, as amended by this Act, applies only to a person who submits an application to register under Chapter 1151, Occupations Code, on or after the effective date of this Act. A person who submits an application to register under Chapter 1151, Occupations Code, before the effective date of this Act is governed by the law in effect on the date the application was submitted, and the former law is continued in effect for that purpose.

SECTION 45. As soon as practicable but not later than the effective date of this Act, the comptroller of public accounts shall prescribe and post on the comptroller's Internet website the form required by Section 5.07(k), Tax Code, as added by this Act.

SECTION 46. Sections 5.07, 25.25, 41.07, and 41.47, Tax Code, as amended by this Act, apply only to an appraisal review board order issued on or after the effective date of this Act. An appraisal review board order issued before the effective date of this Act is governed by the law in effect on the date the order was issued, and the former law is continued in effect for that purpose.

SECTION 47. Sections 11.161 and 11.24, Tax Code, as amended by this Act, apply only to ad valorem taxes imposed for an ad valorem tax year that begins on or after the effective date of this Act.

SECTION 48. Section 11.43(i), Tax Code, as amended by this Act, applies only to an erroneously allowed exemption discovered on or after the effective date of this Act. An erroneously allowed exemption discovered before the effective date of this Act is governed by the law in effect on the date the exemption was discovered, and the former law is continued in effect for that purpose.

SECTION 49. Section 11.4391, Tax Code, as amended by this Act, are procedural and apply to an application for an exemption for freeport goods under Section 11.251, Tax Code, filed during the 2025 tax year and to the preceding two tax years and to an application for exemption filed on or after the effective date of this Act.

SECTION 50. Section 11.4392, Tax Code, as added by this Act, applies only to an application for an ad valorem tax exemption submitted to a chief appraiser on or after the effective date of this Act.

SECTION 51. Section 21.20, Tax Code, as amended by this Act, are procedural in nature and apply to an application for an allocation under Section 21.09, Tax Code, filed during the 2025 tax year and to the preceding two tax years and to an application for allocation filed on or after the effective date of this Act.

SECTION 52. Sections 22.28(a) and 22.30, Tax Code, as amended by this Act, apply only to a rendition statement or property report required to be filed on or after the effective date of this Act. A rendition statement or property report required to be filed before the effective date of this Act is governed by the law in effect on the date the statement or report was required to be filed, and the former law is continued in effect for that purpose.

SECTION 53. Section 23.01(d), Tax Code, as amended by this Act, applies only for a tax year that begins on or after the effective date of this Act.

SECTION 54. Section 25.19(f), Tax Code, as amended by this Act, applies only to a notice of appraised value for an ad valorem tax year that begins on or after the effective date of this Act.

SECTION 55. Section 23.52, Tax Code, as amended by this Act and Section 23.527, Tax Code, as added by this Act, apply only to the appraisal of land for ad valorem tax purposes for a tax year that begins on or after the effective date of this Act.

SECTION 56. Section 26.09, Tax Code, as amended by this Act, applies only to taxes assessed on property as provided by Subsection (d) of that section on or after the effective date of this Act. Taxes assessed on property before the effective date of this Act are governed by the law in effect on the date the taxes were assessed, and the former law is continued in effect for that purpose.

SECTION 57. Section 41.43(b), Tax Code, as amended by this Act, applies only to a protest under Chapter 41, Tax Code, for which a notice of protest is filed on or after the effective date of this Act.

SECTION 58. Section 41A.09(f), Tax Code, as added by this Act, applies only to a determination of appraised value made by an arbitrator under Chapter 41A, Tax Code, on or after the effective date of this Act.

SECTION 59. Section 42.26(a), Tax Code, as amended by this Act, applies only to an appeal under Chapter 42, Tax Code, for which a petition for review is filed on or after the effective date of this Act.

SECTION 60. Chapter 42, Tax Code, as amended by this Act, applies only to an appeal under that chapter that is filed on or after the effective date of this Act. An appeal filed before the effective date of this Act is governed by the law in effect on the date the appeal was filed, and the former law is continued in effect for that purpose.

SECTION 61. This Act takes effect January 1, 2026