Bill Text: TX HB1189 | 2023-2024 | 88th Legislature | Introduced
Bill Title: Relating to limitations on the appraised value of certain real property in specified areas for ad valorem tax purposes.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2023-03-02 - Referred to Ways & Means [HB1189 Detail]
Download: Texas-2023-HB1189-Introduced.html
88R1084 TJB-D | ||
By: Davis | H.B. No. 1189 |
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relating to limitations on the appraised value of certain real | ||
property in specified areas for ad valorem tax purposes. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 1.12(d), Tax Code, is amended to read as | ||
follows: | ||
(d) For purposes of this section, the appraisal ratio of | ||
real property [ |
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23.232 applies is the ratio of the property's market value as | ||
determined by the appraisal district or appraisal review board, as | ||
applicable, to the market value of the property according to law. | ||
The appraisal ratio is not calculated according to the appraised | ||
value of the property as limited by Section 23.23, 23.231, or | ||
23.232. | ||
SECTION 2. Subchapter B, Chapter 23, Tax Code, is amended by | ||
adding Sections 23.231 and 23.232 to read as follows: | ||
Sec. 23.231. TEMPORARY LIMITATION ON APPRAISED VALUE OF | ||
CERTAIN REAL PROPERTY IN SPECIFIED AREAS. (a) In this section: | ||
(1) "Census tract" means the geographic area | ||
identified as a "tract" on the 2020 Census TIGER/Line Shapefiles, | ||
prepared by the federal Bureau of the Census for the Twenty-fourth | ||
Decennial Census of the United States, enumerated as of April 1, | ||
2020. | ||
(2) "Eligible property" means real property that: | ||
(A) is: | ||
(i) a residence homestead; or | ||
(ii) an undeveloped lot, subject to | ||
Subsection (f); and | ||
(B) is located in one of the following census | ||
tracts: | ||
(i) Dallas County tract 002703; or | ||
(ii) Harris County tract 210900, 211000, | ||
211101, 211102, 211200, or 211700. | ||
(3) "Residence homestead" has the meaning assigned by | ||
Section 11.13. | ||
(b) The governing body of a municipality, county, or school | ||
district may by official action adopt a limitation as prescribed by | ||
this section on the appraised value of all eligible property | ||
located in the taxing unit adopting the limitation. The governing | ||
body of a municipality, county, or school district may not repeal, | ||
rescind, or take other action to negate the adoption of the | ||
limitation once adopted under this subsection. | ||
(c) Notwithstanding the requirements of Sections 23.23 and | ||
25.18, and regardless of whether the appraisal office has appraised | ||
the property and determined the market value of the property for the | ||
tax year, an appraisal office may increase the appraised value of | ||
eligible property for a tax year to which a limitation under this | ||
section applies for purposes of taxation of the property by the | ||
taxing unit that adopted the limitation to an amount not to exceed | ||
the lesser of: | ||
(1) the appraised value of the property as otherwise | ||
determined by law; or | ||
(2) the appraised value of the property for the tax | ||
year preceding the tax year in which the limitation adopted by that | ||
taxing unit first applies, as provided by Subsection (e). | ||
(d) When appraising eligible property, the chief appraiser | ||
shall: | ||
(1) appraise the property as otherwise determined by | ||
law; and | ||
(2) include in the appraisal records: | ||
(A) the appraised value of the property | ||
determined under Subdivision (1); and | ||
(B) the amount determined under Subsection | ||
(c)(2) applicable to each taxing unit that has adopted the | ||
limitation. | ||
(e) Except as provided by Subsection (f), a limitation once | ||
adopted by a governing body under this section applies to each tax | ||
year: | ||
(1) beginning with: | ||
(A) the tax year in which the governing body | ||
adopts the limitation, if the governing body adopts the limitation | ||
on or before April 1; or | ||
(B) the tax year following the tax year in which | ||
the governing body adopts the limitation, if the governing body | ||
adopts the limitation after April 1; and | ||
(2) ending with the 2039 tax year. | ||
(f) A limitation adopted under this section as applied to a | ||
vacant lot expires on the earlier of: | ||
(1) January 1 following the end of the fifth tax year | ||
for which the limitation applies, unless: | ||
(A) a single-family residence has been | ||
constructed on the property; and | ||
(B) the owner of the residence has qualified the | ||
property as the owner's residence homestead; or | ||
(2) January 1 of the tax year in which the vacant lot | ||
is: | ||
(A) developed for a purpose other than as a | ||
single-family residence; or | ||
(B) developed as a single-family residence but | ||
not qualified as the residence homestead of an owner of the | ||
property. | ||
(g) This section expires January 1, 2040. | ||
Sec. 23.232. LIMITATION ON APPRAISED VALUE OF RAPIDLY | ||
APPRECIATING RESIDENCE HOMESTEADS IN SPECIFIED AREAS. (a) In this | ||
section: | ||
(1) "Census tract" means the geographic area | ||
identified as a "tract" on the 2020 Census TIGER/Line Shapefiles, | ||
prepared by the federal Bureau of the Census for the Twenty-fourth | ||
Decennial Census of the United States, enumerated as of April 1, | ||
2020. | ||
(2) "Disaster recovery program" means the disaster | ||
recovery program administered by the General Land Office or by a | ||
political subdivision of this state that is funded with community | ||
development block grant disaster recovery money authorized by | ||
federal law. | ||
(3) "New improvement" means an improvement to a | ||
rapidly appreciating residence homestead made after the most recent | ||
appraisal of the property that increases the market value of the | ||
property and the value of which is not included in the appraised | ||
value of the property for the preceding tax year. The term does not | ||
include repairs to or ordinary maintenance of an existing structure | ||
or the grounds or another feature of the property. | ||
(4) "Rapidly appreciating residence homestead" means | ||
real property: | ||
(A) that is a residence homestead; | ||
(B) that is located in Dallas County census tract | ||
004300, 010101, 010102, 010500, 010601, 010602, or 020500; | ||
(C) for which the owner was granted a residence | ||
homestead exemption in the 2017, 2018, 2019, 2020, 2021, 2022, | ||
2023, and 2024 tax years; and | ||
(D) for which the market value for the 2024 tax | ||
year is at least 25 percent higher than the market value of the | ||
property for the 2017 tax year. | ||
(5) "Residence homestead" has the meaning assigned by | ||
Section 11.13. | ||
(b) Notwithstanding the requirements of Sections 23.23 and | ||
25.18, and regardless of whether the appraisal office has appraised | ||
the property and determined the market value of the property for the | ||
tax year, an appraisal office may increase the appraised value of a | ||
rapidly appreciating residence homestead for a tax year to an | ||
amount not to exceed the lesser of: | ||
(1) the market value of the property for the most | ||
recent tax year that the market value was determined by the | ||
appraisal office; or | ||
(2) the sum of: | ||
(A) the appraised value of the property for the | ||
2017 tax year; and | ||
(B) the market value of all new improvements to | ||
the property. | ||
(c) When appraising a rapidly appreciating residence | ||
homestead, the chief appraiser shall: | ||
(1) appraise the property at its market value; and | ||
(2) include in the appraisal records: | ||
(A) the market value of the property; and | ||
(B) the amount determined under Subsection | ||
(b)(2). | ||
(d) The limitation provided by Subsection (b) expires on | ||
January 1 of the first tax year that neither the owner of the | ||
property when the limitation took effect nor the owner's spouse or | ||
surviving spouse qualifies for an exemption under Section 11.13. | ||
(e) Notwithstanding Subsection (b), and except as provided | ||
by Subdivision (2), an improvement to property that would otherwise | ||
constitute a new improvement is not treated as a new improvement if | ||
the improvement is a replacement structure for a structure that was | ||
rendered uninhabitable or unusable by a casualty or by wind, fire, | ||
or water damage. For purposes of appraising the property under | ||
Subsection (b) in the tax year in which the structure would have | ||
constituted a new improvement: | ||
(1) the appraised value the property would have had in | ||
the preceding tax year if the casualty or damage had not occurred is | ||
considered to be the appraised value of the property for that year, | ||
regardless of whether that appraised value exceeds the actual | ||
appraised value of the property for that year as limited by | ||
Subsection (b); and | ||
(2) the replacement structure is considered to be a | ||
new improvement only if: | ||
(A) the square footage of the replacement | ||
structure exceeds that of the replaced structure as that structure | ||
existed before the casualty or damage occurred; or | ||
(B) the exterior of the replacement structure is | ||
of higher quality construction and composition than that of the | ||
replaced structure. | ||
(f) Notwithstanding Subsection (e)(2), and only to the | ||
extent necessary to satisfy the requirements of the disaster | ||
recovery program, a replacement structure described by that | ||
subdivision is not considered to be a new improvement if to satisfy | ||
the requirements of the disaster recovery program it was necessary | ||
that: | ||
(1) the square footage of the replacement structure | ||
exceed that of the replaced structure as that structure existed | ||
before the casualty or damage occurred; or | ||
(2) the exterior of the replacement structure be of | ||
higher quality construction and composition than that of the | ||
replaced structure. | ||
SECTION 3. Sections 25.19(b) and (g), Tax Code, are amended | ||
to read as follows: | ||
(b) The chief appraiser shall separate real from personal | ||
property and include in the notice for each: | ||
(1) a list of the taxing units in which the property is | ||
taxable; | ||
(2) the appraised value of the property in the | ||
preceding year; | ||
(3) the taxable value of the property in the preceding | ||
year for each taxing unit taxing the property; | ||
(4) the appraised value of the property for the | ||
current year, the kind and amount of each exemption and partial | ||
exemption, if any, approved for the property for the current year | ||
and for the preceding year, and, if an exemption or partial | ||
exemption that was approved for the preceding year was canceled or | ||
reduced for the current year, the amount of the exemption or partial | ||
exemption canceled or reduced; | ||
(4-a) a statement of whether the property qualifies | ||
for a limitation on appraised value under Section 23.231 or 23.232; | ||
(5) in italic typeface, the following statement: "The | ||
Texas Legislature does not set the amount of your local taxes. Your | ||
property tax burden is decided by your locally elected officials, | ||
and all inquiries concerning your taxes should be directed to those | ||
officials"; | ||
(6) a detailed explanation of the time and procedure | ||
for protesting the value; | ||
(7) the date and place the appraisal review board will | ||
begin hearing protests; | ||
(8) an explanation of the availability and purpose of | ||
an informal conference with the appraisal office before a hearing | ||
on a protest; and | ||
(9) a brief explanation that the governing body of | ||
each taxing unit decides whether or not taxes on the property will | ||
increase and the appraisal district only determines the value of | ||
the property. | ||
(g) By April 1 or as soon thereafter as practicable if the | ||
property is a single-family residence that qualifies for an | ||
exemption under Section 11.13, or by May 1 or as soon thereafter as | ||
practicable in connection with any other property, the chief | ||
appraiser shall deliver a written notice to the owner of each | ||
property not included in a notice required to be delivered under | ||
Subsection (a), if the property was reappraised in the current tax | ||
year, if the ownership of the property changed during the preceding | ||
year, or if the property owner or the agent of a property owner | ||
authorized under Section 1.111 makes a written request for the | ||
notice. The chief appraiser shall separate real from personal | ||
property and include in the notice for each property: | ||
(1) the appraised value of the property in the | ||
preceding year; | ||
(2) the appraised value of the property for the | ||
current year and the kind of each partial exemption, if any, | ||
approved for the current year; | ||
(2-a) a statement of whether the property qualifies | ||
for a limitation on appraised value under Section 23.231 or 23.232; | ||
(3) a detailed explanation of the time and procedure | ||
for protesting the value; and | ||
(4) the date and place the appraisal review board will | ||
begin hearing protests. | ||
SECTION 4. Section 41.41(a), Tax Code, is amended to read as | ||
follows: | ||
(a) A property owner is entitled to protest before the | ||
appraisal review board the following actions: | ||
(1) determination of the appraised value of the | ||
owner's property or, in the case of land appraised as provided by | ||
Subchapter C, D, E, or H, Chapter 23, determination of its appraised | ||
or market value; | ||
(2) unequal appraisal of the owner's property; | ||
(3) inclusion of the owner's property on the appraisal | ||
records; | ||
(4) denial to the property owner in whole or in part of | ||
a partial exemption; | ||
(4-a) determination that the owner's property does not | ||
qualify for a limitation on appraised value under Section 23.231 or | ||
23.232; | ||
(5) determination that the owner's land does not | ||
qualify for appraisal as provided by Subchapter C, D, E, or H, | ||
Chapter 23; | ||
(6) identification of the taxing units in which the | ||
owner's property is taxable in the case of the appraisal district's | ||
appraisal roll; | ||
(7) determination that the property owner is the owner | ||
of property; | ||
(8) a determination that a change in use of land | ||
appraised under Subchapter C, D, E, or H, Chapter 23, has occurred; | ||
or | ||
(9) any other action of the chief appraiser, appraisal | ||
district, or appraisal review board that applies to and adversely | ||
affects the property owner. | ||
SECTION 5. Section 42.26(d), Tax Code, is amended to read as | ||
follows: | ||
(d) For purposes of this section, the value of the property | ||
subject to the suit and the value of a comparable property or sample | ||
property that is used for comparison must be the market value | ||
determined by the appraisal district when the property is [ |
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value under [ |
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SECTION 6. This Act applies only to the appraisal of real | ||
property for ad valorem tax purposes for a tax year that begins on | ||
or after the effective date of this Act. | ||
SECTION 7. This Act takes effect January 1, 2024, but only | ||
if the constitutional amendment proposed by the 88th Legislature, | ||
Regular Session, 2023, to authorize the legislature to provide for | ||
limitations on the appraised value of certain real property in | ||
specified areas for ad valorem tax purposes is approved by the | ||
voters. If that amendment is not approved by the voters, this Act | ||
has no effect. |