Bill Text: TX HB167 | 2017-2018 | 85th Legislature | Introduced

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Bill Title: Relating to a limitation on the maximum appraised value of real property for ad valorem tax purposes of 105 percent of the appraised value of the property for the preceding tax year.

Spectrum: Partisan Bill (Republican 5-0)

Status: (Introduced - Dead) 2017-02-14 - Referred to Ways & Means [HB167 Detail]

Download: Texas-2017-HB167-Introduced.html

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85R109 LHC-D
By: Bell H.B. No. 167

A BILL TO BE ENTITLED
AN ACT
relating to a limitation on the maximum appraised value of real
property for ad valorem tax purposes of 105 percent of the appraised
value of the property for the preceding tax year.
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 [a homestead] to which Section 23.23 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.
SECTION 2. The heading to Section 23.23, Tax Code, is
amended to read as follows:
Sec. 23.23. LIMITATION ON APPRAISED VALUE OF REAL PROPERTY
[RESIDENCE HOMESTEAD].
SECTION 3. Section 23.23, Tax Code, is amended by amending
Subsections (a), (b), (c), and (e) and adding Subsections (c-1),
(c-2), and (c-3) to read as follows:
(a) Notwithstanding the requirements of Section 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 real
property [a 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) five [10] percent of the appraised value of
the property for the preceding tax year;
(B) the appraised value of the property for the
preceding tax year; and
(C) the market value of all new improvements to
the property.
(b) When appraising real property [a residence homestead],
the chief appraiser shall:
(1) appraise the property at its market value; and
(2) include in the appraisal records both the market
value of the property and the amount computed under Subsection
(a)(2).
(c) The limitation provided by Subsection (a) takes effect
on January 1 of the tax year following the first tax year in which
the owner owns the property on January 1, or, if the property
qualifies as the [to a] residence homestead of the owner under
Section 11.13 in the tax year in which the owner acquires the
property, the limitation takes effect on January 1 of the tax year
following that [the first] tax year [the owner qualifies the
property for an exemption under Section 11.13]. Except as provided
by Subsection (c-1) or (c-2), the [The] limitation expires on
January 1 of the first tax year following the year in which [that
neither] the owner of the property ceases to own the property.
(c-1) If property subject to a limitation under this section
qualifies for an exemption under Section 11.13 when the ownership
of the property is transferred to the owner's spouse or surviving
spouse, the limitation expires on January 1 of the first tax year
following the year in which [when the limitation took effect nor]
the owner's spouse or surviving spouse ceases to own the property,
unless the limitation is further continued under this subsection on
the subsequent transfer to a spouse or surviving spouse [qualifies
for an exemption under Section 11.13].
(c-2) If property subject to a limitation under Subsection
(a), other than a residence homestead, is owned by two or more
persons, the limitation expires on January 1 of the first tax year
following the year in which the ownership of at least a 50 percent
interest in the property is sold or otherwise transferred.
(c-3) For purposes of applying the limitation provided by
this section in the first tax year after the 2017 tax year in which
the property is appraised for taxation:
(1) the property is considered to have been appraised
for taxation in the 2017 tax year at a market value equal to the
appraised value of the property for that tax year;
(2) a person who acquired real property in a tax year
before the 2017 tax year is considered to have acquired the property
on January 1, 2017; and
(3) a person who qualified the property for an
exemption under Section 11.13 as the person's residence homestead
for any portion of the 2017 tax year is considered to have acquired
the property in the 2017 tax year.
(e) In this section, "new improvement" means an improvement
to real property [a 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.
SECTION 4. 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 [a
residence homestead] subject to the limitation on appraised value
imposed by Section 23.23.
SECTION 5. Sections 403.302(d) and (i), Government Code,
are amended to read as follows:
(d) For the purposes of this section, "taxable value" means
the market value of all taxable property less:
(1) the total dollar amount of any residence homestead
exemptions lawfully granted under Section 11.13(b) or (c), Tax
Code, in the year that is the subject of the study for each school
district;
(2) one-half of the total dollar amount of any
residence homestead exemptions granted under Section 11.13(n), Tax
Code, in the year that is the subject of the study for each school
district;
(3) the total dollar amount of any exemptions granted
before May 31, 1993, within a reinvestment zone under agreements
authorized by Chapter 312, Tax Code;
(4) subject to Subsection (e), the total dollar amount
of any captured appraised value of property that:
(A) is within a reinvestment zone created on or
before May 31, 1999, or is proposed to be included within the
boundaries of a reinvestment zone as the boundaries of the zone and
the proposed portion of tax increment paid into the tax increment
fund by a school district are described in a written notification
provided by the municipality or the board of directors of the zone
to the governing bodies of the other taxing units in the manner
provided by former Section 311.003(e), Tax Code, before May 31,
1999, and within the boundaries of the zone as those boundaries
existed on September 1, 1999, including subsequent improvements to
the property regardless of when made;
(B) generates taxes paid into a tax increment
fund created under Chapter 311, Tax Code, under a reinvestment zone
financing plan approved under Section 311.011(d), Tax Code, on or
before September 1, 1999; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(5) the total dollar amount of any captured appraised
value of property that:
(A) is within a reinvestment zone:
(i) created on or before December 31, 2008,
by a municipality with a population of less than 18,000; and
(ii) the project plan for which includes
the alteration, remodeling, repair, or reconstruction of a
structure that is included on the National Register of Historic
Places and requires that a portion of the tax increment of the zone
be used for the improvement or construction of related facilities
or for affordable housing;
(B) generates school district taxes that are paid
into a tax increment fund created under Chapter 311, Tax Code; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(6) the total dollar amount of any exemptions granted
under Section 11.251 or 11.253, Tax Code;
(7) the difference between the comptroller's estimate
of the market value and the productivity value of land that
qualifies for appraisal on the basis of its productive capacity,
except that the productivity value estimated by the comptroller may
not exceed the fair market value of the land;
(8) the portion of the appraised value of residence
homesteads of individuals who receive a tax limitation under
Section 11.26, Tax Code, on which school district taxes are not
imposed in the year that is the subject of the study, calculated as
if the residence homesteads were appraised at the full value
required by law;
(9) a portion of the market value of property not
otherwise fully taxable by the district at market value because of:
(A) action required by statute or the
constitution of this state, other than Section 11.311, Tax Code,
that, if the tax rate adopted by the district is applied to it,
produces an amount equal to the difference between the tax that the
district would have imposed on the property if the property were
fully taxable at market value and the tax that the district is
actually authorized to impose on the property, if this subsection
does not otherwise require that portion to be deducted; or
(B) action taken by the district under Subchapter
B or C, Chapter 313, Tax Code, before the expiration of the
subchapter;
(10) the market value of all tangible personal
property, other than manufactured homes, owned by a family or
individual and not held or used for the production of income;
(11) the appraised value of property the collection of
delinquent taxes on which is deferred under Section 33.06, Tax
Code;
(12) the portion of the appraised value of property
the collection of delinquent taxes on which is deferred under
Section 33.065, Tax Code; and
(13) the amount by which the market value of real
property [a residence homestead] to which Section 23.23, Tax Code,
applies exceeds the appraised value of that property as calculated
under that section.
(i) If the comptroller determines in the study that the
market value of property in a school district as determined by the
appraisal district that appraises property for the school district,
less the total of the amounts and values listed in Subsection (d) as
determined by that appraisal district, is valid, the comptroller,
in determining the taxable value of property in the school district
under Subsection (d), shall for purposes of Subsection (d)(13)
subtract from the market value as determined by the appraisal
district of properties [residence homesteads] to which Section
23.23, Tax Code, applies the amount by which that amount exceeds the
appraised value of those properties as calculated by the appraisal
district under Section 23.23, Tax Code. If the comptroller
determines in the study that the market value of property in a
school district as determined by the appraisal district that
appraises property for the school district, less the total of the
amounts and values listed in Subsection (d) as determined by that
appraisal district, is not valid, the comptroller, in determining
the taxable value of property in the school district under
Subsection (d), shall for purposes of Subsection (d)(13) subtract
from the market value as estimated by the comptroller of properties
[residence homesteads] to which Section 23.23, Tax Code, applies
the amount by which that amount exceeds the appraised value of those
properties as calculated by the appraisal district under Section
23.23, Tax Code.
SECTION 6. This Act applies only to the appraisal for ad
valorem tax purposes of real property for a tax year that begins on
or after the effective date of this Act.
SECTION 7. This Act takes effect January 1, 2018, but only
if the constitutional amendment proposed by the 85th Legislature,
Regular Session, 2017, to authorize the legislature to limit the
maximum appraised value of real property for ad valorem tax
purposes to 105 percent or more of the appraised value of the
property for the preceding tax year is approved by the voters. If
that amendment is not approved by the voters, this Act has no
effect.