Bill Text: TX HB91 | 2017 | 85th Legislature 1st Special Session | Introduced


Bill Title: Relating to the abolition of ad valorem taxes and a study of alternative methods of taxation to replace revenue lost to political subdivisions as a result of the abolition of ad valorem taxes.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2017-07-20 - Referred to Ways & Means [HB91 Detail]

Download: Texas-2017-HB91-Introduced.html
  85S10039 CJC-D
 
  By: Swanson H.B. No. 91
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the abolition of ad valorem taxes and a study of
  alternative methods of taxation to replace revenue lost to
  political subdivisions as a result of the abolition of ad valorem
  taxes.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  (a) The legislature finds that:
               (1)  the imposition of ad valorem taxes is an
  inherently inequitable means to generate revenue necessary to fund
  the provision of essential services to residents of this state;
               (2)  ad valorem taxes may increase annually without
  regard to the property owner's ability to pay;
               (3)  ad valorem taxes are perpetual and detrimental to
  private property rights as secured by the Texas Constitution;
               (4)  the use of ad valorem taxes as a means to finance
  the maintenance of public free schools has led directly to three
  decades of school finance litigation in which the Texas Supreme
  Court has referred to the system as "Byzantine" and has urged the
  legislature to "choose a new path" of revenue for public free
  schools;
               (5)  the use of ad valorem taxes by local governmental
  entities as a means to generate revenue to fund the provision of
  essential services places a disproportionate burden on those
  residents that own property to pay for services that are enjoyed by
  all residents; and
               (6)  the legislature has an obligation to ensure that
  local governmental entities provide essential services in a manner
  that is fair and fiscally responsible, and should encourage the use
  of a more equitable source of revenue, such as the sales tax, to
  fund the provision of those services.
         (b)  It is the intent of the legislature to abolish ad
  valorem taxes and to create a more equitable means of funding the
  provision of essential services to residents of this state by local
  governmental entities and of meeting the state's constitutional
  duty to make suitable provision for the support and maintenance of
  an efficient system of public free schools.
         SECTION 2.  (a) The comptroller of public accounts shall
  conduct a comprehensive study of alternative methods of taxation to
  replace local tax revenue that will be lost when ad valorem taxes
  are abolished.
         (b)  For each alternative method of taxation considered by
  the comptroller, the comptroller shall:
               (1)  consider whether political subdivisions that
  currently impose ad valorem taxes would have the authority to
  impose the proposed alternative tax;
               (2)  determine the average tax rate for the proposed
  alternative tax imposed by each type of political subdivision that
  would be necessary to generate the same amount of tax revenue as the
  amount of tax revenue lost as a result of the abolition of ad
  valorem taxes;
               (3)  determine, if appropriate, the effect that
  broadening the application of the proposed alternative tax at the
  local level would have on the tax rates identified under
  Subdivision (2) of this subsection;
               (4)  identify whether tax revenue generated by the
  proposed alternative tax would require redistribution to offset
  disparities in available local tax revenue as a result of the
  abolition of ad valorem taxes and, if so, evaluate the different
  mechanisms of redistribution available; and
               (5)  identify and examine any other issue that would
  need to be addressed to implement the abolition of ad valorem taxes.
         (c)  On request of the comptroller, a state agency or
  political subdivision shall provide information for and assistance
  in conducting the study under this section.
         (d)  Not later than December 1, 2018, the comptroller shall
  prepare and submit to the governor, lieutenant governor, speaker of
  the house of representatives, and members of the legislature a
  written report containing the results of the study and any
  recommendations for legislative or other action.
         (e)  This section expires September 1, 2019.
         SECTION 3.  (a) Title 1, Tax Code, is repealed.
         (b)  Notwithstanding any other law, this state or a political
  subdivision of this state may not impose an ad valorem tax. To the
  extent of a conflict, this section controls over a conflicting
  provision in a general or special law.
         (c)  The change in law made by this section does not affect
  tax liability accruing before the effective date of this section.
  That liability continues in effect as if this section had not been
  enacted, and the former law is continued in effect for the
  collection of taxes due and for civil and criminal enforcement of
  the liability for those taxes.
         (d)  This section takes effect January 1, 2022.
         SECTION 4.  Except as otherwise provided by this Act, this
  Act takes effect December 1, 2017.
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