89R15872 KJE-D

By: Noble H.J.R. No. 183

A JOINT RESOLUTION

proposing a constitutional amendment establishing the property tax reduction fund to reduce school district maintenance and operations ad valorem taxes and dedicating certain unencumbered general revenue and certain general revenue that would otherwise be transferred to the economic stabilization fund to that fund.

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

SECTION 1. Section 49-g, Article III, Texas Constitution, is amended by amending Subsections (c), (c-1), (c-2), and (h) and adding Subsection (g-1) to read as follows:

(c) Not later than the 90th day of each fiscal year, the comptroller of public accounts shall transfer from the general revenue fund to the economic stabilization fund, the property tax reduction fund, and the state highway fund the sum of the amounts described by Subsections (d) and (e) of this section, to be allocated as provided by Subsections (c-1) and (c-2) of this section. However, if necessary and notwithstanding the allocations prescribed by Subsections (c-1) and (c-2) of this section, the comptroller shall reduce proportionately the amounts described by Subsections (d) and (e) of this section to be transferred and allocated to the economic stabilization fund to prevent the amount in that fund from exceeding the limit in effect for that biennium under Subsection (g) of this section. Revenue transferred to the state highway fund under this subsection may be used only for constructing, maintaining, and acquiring rights-of-way for public roadways other than toll roads.

(c-1) Of the sum of the amounts described by Subsections (d) and (e) of this section and required to be transferred from the general revenue fund under Subsection (c) of this section, the comptroller shall allocate one-quarter [one-half] to the economic stabilization fund, one-quarter to the property tax reduction fund, and the remainder to the state highway fund, except as provided by Subsection (c-2) of this section.

(c-2) The legislature by general law shall provide for a procedure by which the allocation of the sum of the amounts described by Subsections (d) and (e) of this section may be adjusted to provide for a transfer to the economic stabilization fund of an amount greater than the allocation provided for under Subsection (c-1) of this section with the remainder of that sum, if any, allocated for transfer to the property tax reduction fund and the state highway fund as provided by general law. The allocation made as provided by that general law is binding on the comptroller for the purposes of the transfers required by Subsection (c) of this section.

(g-1) When the comptroller of public accounts acts to prevent the amount in the economic stabilization fund from exceeding the limit in effect for a biennium under Subsection (g) of this section by reducing an amount transferred to the fund from general revenue as provided by Subsection (b) or (c) of this section or by crediting to general revenue interest that is due to the fund as provided by Subsection (i) of this section, the comptroller shall:

(1) determine an amount of general revenue equal to the amount by which the balance of general revenue is increased by the reduction of the transfer from general revenue or the crediting of interest to general revenue; and

(2) transfer the amount determined under Subdivision (1) of this subsection to the property tax reduction fund established under Section 3-a, Article VII, of this constitution.

(h) In preparing an estimate of anticipated revenues for a succeeding biennium as required by Section 49a, Article III, [Section 49a,] of this constitution, the comptroller shall estimate the amount of the transfers that will be made under Subsections (b), (d), [and] (e), and (g-1) of this section. The comptroller shall deduct that amount from the estimate of anticipated revenues as if the transfers were made on August 31 of that fiscal year.

SECTION 2. Article VII, Texas Constitution, is amended by adding Section 3-a to read as follows:

Sec. 3-a. (a) The property tax reduction fund is established as a fund in the state treasury outside the general revenue fund for the purpose of reducing school district maintenance and operations ad valorem taxes.

(b) The fund consists of:

(1) money appropriated or transferred to the credit of the fund; and

(2) interest and other earnings on the investment of money in the fund.

(c) Not later than the 90th day of each state fiscal biennium, the comptroller of public accounts shall transfer to the credit of the fund one-half of any unencumbered positive balance of general revenue that exists on the last day of the preceding biennium.

(d) Money in the fund may be appropriated only for the purpose of reducing school district maintenance and operations ad valorem taxes in the manner provided by general law or maintaining the reduction of those taxes once the amount of those taxes reaches zero.

SECTION 3. The following temporary provision is added to the Texas Constitution:

TEMPORARY PROVISION. (a) This temporary provision applies to the constitutional amendment proposed by the 89th Legislature, Regular Session, 2025, establishing the property tax reduction fund to reduce school district maintenance and operations ad valorem taxes and dedicating certain unencumbered general revenue and certain general revenue that would otherwise be transferred to the economic stabilization fund to that fund.

(b) The amendments to Section 49-g, Article III, of this constitution, and Section 3-a, Article VII, of this constitution, as added by the amendment, take effect September 1, 2027.

(c) This temporary provision expires September 1, 2028.

SECTION 4. This proposed constitutional amendment shall be submitted to the voters at an election to be held November 4, 2025. The ballot shall be printed to permit voting for or against the proposition: "The constitutional amendment establishing the property tax reduction fund to reduce school district maintenance and operations ad valorem taxes and dedicating certain unencumbered general revenue and certain general revenue that would otherwise be transferred to the economic stabilization fund to that fund."