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A BILL TO BE ENTITLED
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AN ACT
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relating to the limitation on increases in the appraised value of |
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certain real property for ad valorem tax purposes. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 23.231(c), (d), and (k), Tax Code, are |
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amended to read as follows: |
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(c) This section does not apply to: |
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(1) a residence homestead that qualifies for an |
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exemption under Section 11.13; [or] |
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(2) property appraised under Subchapter C, D, E, F, G, |
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or H; or |
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(3) a mineral interest. |
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(d) Notwithstanding the requirements of Section 25.18 and |
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regardless of whether the appraisal office has appraised the |
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property and determined the market value of the property for the tax |
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year, an appraisal office may increase the appraised value of real |
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property to which this section applies for a tax year to an amount |
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not to exceed the lesser of: |
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(1) the market value of the property for the most |
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recent tax year that the market value was determined by the |
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appraisal office; or |
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(2) the sum of: |
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(A) 10 [20] percent of the appraised value of the |
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property for the preceding tax year; |
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(B) the appraised value of the property for the |
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preceding tax year; and |
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(C) the market value of all new improvements to |
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the property. |
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(k) This section expires December 31, 2031 [2026]. |
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SECTION 2. Section 25.19(o), Tax Code, is amended to read as |
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follows: |
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(o) A notice required under Subsection (a) or (g) to be |
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delivered to the owner of real property other than a single-family |
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residence that qualifies for an exemption under Section 11.13 must |
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include the following statement: "Under Section 23.231, Tax Code, |
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for the [2024, 2025, and] 2026, 2027, 2028, 2029, 2030, and 2031 tax |
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years, the appraised value of real property other than a residence |
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homestead for ad valorem tax purposes may not be increased by more |
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than 10 [20] percent each year, with certain exceptions. The |
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circuit breaker limitation provided under Section 23.231, Tax Code, |
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expires December 31, 2031 [2026]. Unless this expiration date is |
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extended by the Texas Legislature, beginning in the 2032 [2027] tax |
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year, the circuit breaker limitation provided under Section 23.231, |
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Tax Code, will no longer be in effect and may result in an increase |
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in ad valorem taxes imposed on real property previously subject to |
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the limitation." This subsection expires December 31, 2032 [2027]. |
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SECTION 3. Notwithstanding Chapter 1 (S.B. 2), Acts of the |
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88th Legislature, 2nd Called Session, 2023, the following |
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provisions are effective January 1, 2032: |
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(1) Section 4.02, Chapter 1 (S.B. 2), Acts of the 88th |
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Legislature, 2nd Called Session, 2023, which amended Section |
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1.12(d), Tax Code; |
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(2) Section 4.05, Chapter 1 (S.B. 2), Acts of the 88th |
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Legislature, 2nd Called Session, 2023, which amended Sections |
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25.19(b) and (g), Tax Code; |
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(3) Section 4.08, Chapter 1 (S.B. 2), Acts of the 88th |
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Legislature, 2nd Called Session, 2023, which amended Section |
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41.41(a), Tax Code; |
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(4) Section 4.10, Chapter 1 (S.B. 2), Acts of the 88th |
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Legislature, 2nd Called Session, 2023, which amended Section |
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42.26(d), Tax Code; and |
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(5) Section 4.12, Chapter 1 (S.B. 2), Acts of the 88th |
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Legislature, 2nd Called Session, 2023, which amended Sections |
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403.302(d) and (i), Government Code. |
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SECTION 4. Sections 23.231(c) and (d), Tax Code, as amended |
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by this Act, apply only to the appraisal of real property for ad |
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valorem tax purposes for a tax year that begins on or after the |
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effective date of this Act. |
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SECTION 5. (a) Except as otherwise provided by this |
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section, this Act takes effect January 1, 2026. |
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(b) Sections 23.231(d) and (k) and 25.19(o), Tax Code, as |
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amended by this Act, and Section 3 of this Act take effect January |
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1, 2026, but only if the constitutional amendment proposed by the |
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89th Legislature, Regular Session, 2025, to authorize the |
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legislature to set a lower limit on the maximum appraised value of |
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real property other than a residence homestead for ad valorem tax |
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purposes and to postpone the expiration of the limit is approved by |
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the voters. If that amendment is not approved by the voters, |
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Sections 23.231(d) and (k) and 25.19(o), Tax Code, as amended by |
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this Act, and Section 3 of this Act have no effect. |