88R2118 CJC-F
	By: Howard	H.B. No. 5042

	A BILL TO BE ENTITLED
	AN ACT
	relating to an adjustment of the limitation on the total amount of
	ad valorem taxes that may be imposed by a school district on the
	residence homestead of an individual who is elderly or disabled to
	reflect the most recent increase in the amount of the exemption of
	residence homesteads from ad valorem taxation by a school district
	and the protection of school districts against the resulting loss
	in local revenue.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 11.26, Tax Code, is amended by adding
	Subsection (a-11) to read as follows:
	(a-11)  This subsection applies only to an individual who in
	the 2024 tax year qualifies for a limitation under this section and
	for whom the 2021 tax year or an earlier tax year was the first tax
	year the individual or the individual's spouse qualified for an
	exemption under Section 11.13(c). The amount of the limitation
	provided by this section on the residence homestead of an
	individual to which this subsection applies for the 2024 tax year is
	the amount of the limitation as computed under Subsection (a-10) of
	this section less an amount equal to the product of $15,000 and the
	tax rate of the school district for the 2022 tax year. This
	subsection expires January 1, 2025.
	SECTION 2.  Section 46.071, Education Code, is amended by
	adding Subsection (a-2) and amending Subsections (b-1) and (c-1) to
	read as follows:
	(a-2)  Beginning with the 2024-2025 school year, in addition
	to state aid a school district is entitled to under Subsection
	(a-1), a school district is entitled to additional state aid under
	this subchapter to the extent that state and local revenue used to
	service debt eligible under this chapter is less than the state and
	local revenue that would have been available to the district under
	this chapter as it existed on September 1, 2023, if any additional
	limitation on tax increases under Section 1-b(d), Article VIII,
	Texas Constitution, as proposed by the 88th Legislature, Regular
	Session, 2023, had not occurred.
	(b-1)  Subject to Subsections (c-1), (d), and (e),
	additional state aid under this section beginning with the
	2022-2023 school year is equal to the amount by which the loss of
	local interest and sinking revenue for debt service attributable to
	any increase in the residence homestead exemption under Section
	1-b(c), Article VIII, Texas Constitution, as proposed by the 87th
	Legislature, 3rd Called Session, 2021, and any additional
	limitation on tax increases under Section 1-b(d), Article VIII,
	Texas Constitution, as proposed by the 88th Legislature, Regular
	Session, 2023, is not offset by a gain in state aid under this
	chapter.
	(c-1)  For the purpose of determining state aid under
	Subsection [Subsections] (a-1) or (a-2) [and (b-1)], local interest
	and sinking revenue for debt service is limited to revenue required
	to service debt eligible under this chapter as of September 1, 2021,
	or as of September 1, 2023, respectively, including refunding of
	the applicable [that] debt, subject to Section 46.061.  The
	limitation imposed by Section 46.034(a) does not apply for the
	purpose of determining state aid under Subsection (a-1) or (a-2)
	[this section].
	SECTION 3.  Section 48.2542, Education Code, is amended to
	read as follows:
	Sec. 48.2542.  ADDITIONAL STATE AID FOR ADJUSTMENT OF
	LIMITATION ON TAX INCREASES ON HOMESTEAD OF ELDERLY OR DISABLED.
	Notwithstanding any other provision of this chapter, if a school
	district is not fully compensated through state aid or the
	calculation of excess local revenue under this chapter based on the
	determination of the district's taxable value of property under
	Subchapter M, Chapter 403, Government Code, the district is
	entitled to additional state aid in the amount necessary to fully
	compensate the district for the amount of ad valorem tax revenue
	lost due to a reduction of the amount of the limitation on tax
	increases provided by Sections 11.26(a-4), (a-5), (a-6), (a-7),
	(a-8), (a-9), [and] (a-10), and (a-11), Tax Code, as applicable.
	SECTION 4.  Effective January 1, 2025, Section 48.2542,
	Education Code, is amended to read as follows:
	Sec. 48.2542.  ADDITIONAL STATE AID FOR ADJUSTMENT OF
	LIMITATION ON TAX INCREASES ON HOMESTEAD OF ELDERLY OR DISABLED.
	Notwithstanding any other provision of this chapter, if a school
	district is not fully compensated through state aid or the
	calculation of excess local revenue under this chapter based on the
	determination of the district's taxable value of property under
	Subchapter M, Chapter 403, Government Code, the district is
	entitled to additional state aid in the amount necessary to fully
	compensate the district for the amount of ad valorem tax revenue
	lost due to a reduction of the amount of the limitation on tax
	increases provided by Sections 11.26(a-4), (a-5), (a-6), (a-7),
	(a-8), (a-9), and (a-10), Tax Code, as applicable.
	SECTION 5.  Section 48.2543, Education Code, is amended by
	adding Subsection (a-1) and amending Subsection (b) to read as
	follows:
	(a-1)  Beginning with the 2024-2025 school year, in addition
	to state aid a school district is entitled to under Subsection (a),
	a school district is entitled to additional state aid to the extent
	that state and local revenue under this chapter and Chapter 49 is
	less than the state and local revenue that would have been available
	to the district under this chapter and Chapter 49 as those chapters
	existed on September 1, 2023, if any additional limitation on tax
	increases under Section 1-b(d), Article VIII, Texas Constitution,
	as proposed by the 88th Legislature, Regular Session, 2023, had not
	occurred.
	(b)  The lesser of the school district's currently adopted
	maintenance and operations tax rate or the adopted maintenance and
	operations tax rate for:
	(1)  the 2021 tax year is used for the purpose of
	determining additional state aid under Subsection (a); and
	(2)  the 2023 tax year is used for the purpose of
	determining additional state aid under Subsection (a-1).
	SECTION 6.  Section 48.2556(a), Education Code, is amended
	to read as follows:
	(a)  The agency shall post the following information on the
	agency's Internet website for purposes of allowing the chief
	appraiser of each appraisal district and the assessor for each
	school district to make the calculations required by Sections
	11.26(a-5), (a-6), (a-7), (a-8), (a-9), [and] (a-10), and (a-11),
	Tax Code:
	(1)  each school district's maximum compressed rate, as
	determined under Section 48.2551, for each tax year beginning with
	the 2019 tax year; and
	(2)  each school district's tier one maintenance and
	operations tax rate, as provided by Section 45.0032(a), for the
	2018 tax year.
	SECTION 7.  Effective January 1, 2025, Section 48.2556(a),
	Education Code, is amended to read as follows:
	(a)  The agency shall post the following information on the
	agency's Internet website for purposes of allowing the chief
	appraiser of each appraisal district and the assessor for each
	school district to make the calculations required by Sections
	11.26(a-5), (a-6), (a-7), (a-8), (a-9), and (a-10), Tax Code:
	(1)  each school district's maximum compressed rate, as
	determined under Section 48.2551, for each tax year beginning with
	the 2019 tax year; and
	(2)  each school district's tier one maintenance and
	operations tax rate, as provided by Section 45.0032(a), for the
	2018 tax year.
	SECTION 8.  Section 403.302, Government Code, is amended by
	adding Subsection (j-2) to read as follows:
	(j-2)  In the final certification of the study under
	Subsection (j), the comptroller shall separately identify the final
	taxable value for each school district as adjusted to account for
	the reduction of the amount of the limitation on tax increases
	provided by Section 11.26(a-11), Tax Code.  This subsection expires
	January 1, 2025.
	SECTION 9.  The change in law made by this Act to Section
	11.26, Tax Code, applies only to an ad valorem tax year that begins
	on or after January 1, 2024.
	SECTION 10.  Except as otherwise provided by this Act, this
	Act takes effect January 1, 2024, but only if the constitutional
	amendment proposed by the 88th Legislature, Regular Session, 2023,
	providing for an adjustment of the limitation on the total amount of
	ad valorem taxes that may be imposed by a school district on the
	residence homestead of a person who is elderly or disabled to
	reflect the most recent increase in the amount of the exemption of
	residence homesteads from ad valorem taxation by a school district
	is approved by the voters.  If that amendment is not approved by the
	voters, this Act has no effect.