Bill Text: TX HB4576 | 2023-2024 | 88th Legislature | Introduced
Bill Title: Relating to a limitation on increases in the appraised value for ad valorem tax purposes of agricultural or open-space land.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2023-03-22 - Referred to Ways & Means [HB4576 Detail]
Download: Texas-2023-HB4576-Introduced.html
88R8489 SHH-D | ||
By: Murr | H.B. No. 4576 |
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relating to a limitation on increases in the appraised value for ad | ||
valorem tax purposes of agricultural or open-space land. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 23.41, Tax Code, is amended by amending | ||
Subsection (a) and adding Subsection (a-1) to read as follows: | ||
(a) Except as provided by Subsection (a-1), land [ |
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designated for agricultural use is appraised at its value based on | ||
the land's capacity to produce agricultural products. The value of | ||
land based on its capacity to produce agricultural products is | ||
determined by capitalizing the average net income the land would | ||
have yielded under prudent management from production of | ||
agricultural products during the five years preceding the current | ||
year. However, if the value of land as determined by capitalization | ||
of average net income exceeds the market value of the land as | ||
determined by other generally accepted appraisal methods, the land | ||
shall be appraised by application of the other appraisal methods. | ||
(a-1) The appraisal office may not increase the appraised | ||
value of land designated for agricultural use to an amount that | ||
exceeds 110 percent of the appraised value of the land for the | ||
preceding tax year. The limitation provided by this subsection | ||
takes effect as to a parcel of land on January 1 of the later of the | ||
2024 tax year or the tax year following the first tax year the owner | ||
of the land qualifies the land for designation for agricultural use | ||
under this subchapter and expires on January 1 of the first tax year | ||
the owner of the land when the limitation took effect ceases to | ||
qualify the land for the designation. | ||
SECTION 2. Section 23.46(a), Tax Code, is amended to read as | ||
follows: | ||
(a) When appraising land designated for agricultural use, | ||
the chief appraiser also shall appraise the land at its market value | ||
and shall record both the market value and the value according to | ||
this subchapter [ |
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SECTION 3. Section 23.52, Tax Code, is amended by amending | ||
Subsection (a) and adding Subsection (a-1) to read as follows: | ||
(a) Except as provided by Subsection (a-1), the [ |
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appraised value of qualified open-space land is determined on the | ||
basis of the category of the land, using accepted income | ||
capitalization methods applied to average net to land. The | ||
appraised value so determined may not exceed the market value as | ||
determined by other appraisal methods. | ||
(a-1) The appraisal office may not increase the appraised | ||
value of qualified open-space land to an amount that exceeds 110 | ||
percent of the appraised value of the land for the preceding tax | ||
year. The limitation provided by this subsection takes effect as to | ||
a parcel of land on January 1 of the later of the 2024 tax year or | ||
the tax year following the first tax year the owner of the land | ||
qualifies the land for appraisal as qualified open-space land under | ||
this subchapter and expires on January 1 of the first tax year the | ||
owner of the land when the limitation took effect ceases to qualify | ||
the land for the appraisal. | ||
SECTION 4. Section 403.302, Government Code, is amended by | ||
amending Subsection (d) and adding Subsection (i-1) 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 | ||
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; | ||
(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; | ||
(13) the amount by which the market value of a | ||
residence homestead to which Section 23.23, Tax Code, applies | ||
exceeds the appraised value of that property as calculated under | ||
that section; [ |
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(14) the total dollar amount of any exemptions granted | ||
under Section 11.35, Tax Code; and | ||
(15) the amount by which the lesser of the market value | ||
or the productivity value of land to which Subchapter C or D, | ||
Chapter 23, Tax Code, applies exceeds the appraised value of the | ||
land as calculated under that subchapter. | ||
(i-1) 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)(15) | ||
subtract from the lesser of the market value or the productivity | ||
value as determined by the appraisal district of land to which | ||
Subchapter C or D, Chapter 23, Tax Code, applies the amount by which | ||
that amount exceeds the appraised value of the land as calculated by | ||
the appraisal district under that subchapter. 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)(15) subtract | ||
from the lesser of the market value or productivity value as | ||
estimated by the comptroller of land to which Subchapter C or D, | ||
Chapter 23, Tax Code, applies the amount by which that amount | ||
exceeds the appraised value of the land as calculated by the | ||
appraisal district under that subchapter. | ||
SECTION 5. This Act applies only to the appraisal for ad | ||
valorem tax purposes of land designated for agricultural use or | ||
qualified open-space land for a tax year that begins on or after the | ||
effective date of this Act. | ||
SECTION 6. 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 limit the | ||
maximum appraised value for ad valorem tax purposes in a tax year of | ||
land designated for agricultural use or open-space land devoted to | ||
farm, ranch, or wildlife management purposes to a specified | ||
percentage of the appraised value of the land for the preceding tax | ||
year is approved by the voters. If that amendment is not approved | ||
by the voters, this Act has no effect. |