School District Findings
To calculate taxable values, the Comptroller first employed the methods described earlier to estimate a value for each property category. Totaling the category estimates produced the estimated gross value. To reduce the estimated gross value to taxable value, Government Code Section 403.302 requires the Comptroller to subtract:
- total value exempted by state-mandated homestead exemptions;
- value exempted by state-mandated disabled veterans’ exemptions;
- adjusted value losses arising from the limitations on taxes of residence homesteads owned by person age 65 or older (or the surviving spouse age 55 or older);
- value lost because of tax abatements granted by May 31, 1993, and tax increment financing zones approved before September 1, 1999;
- value lost to freeport exemptions;
- value lost for productivity appraisal;
- value for taxes deferred by homeowners age 65 or older or for homeowners with appreciating homestead values;
- value lost for the residence homestead appraisal limitation;
- value lost to the value limitation under Chapter 313, Tax Code; and
- other allowable exemptions.
Appraisal and school districts reported total losses arising from each of these exemptions and exclusions. The school district summary shows statewide value totals by category and total deductions for homestead and veterans’ exemptions, the residence homestead limitation, the over-65 tax limitation and value lost to tax abatements and other exemptions.
The state summaries show several figures related to rural real property (Category D). These numbers, which reflect the agricultural and timber appraisal laws, show the following:
- market value of acreage that did not qualify for productivity (agricultural or timber) appraisal and farm and ranch improvements;
- productivity value of qualified agricultural acreage; and
- total taxable value of all acreage (the sum of Items 1 and 2).
The state total for “Category D, Rural Real (Taxable)” equals the sum of the productivity value of qualified agricultural and timber land and the market value of other rural real property. The value lost to limitations for homeowners age 65 or older (or their surviving spouse age 55 or older) arises from a state law that limits the school taxes that 65 or older homeowners pay on their residence homesteads. The school taxes cannot increase over the amount the owner paid in the first year that the owner was 65 years old and applied for the exemption on that homestead. As a result, school districts may not levy a tax on the full market value of such properties. These homeowners may also defer paying the taxes on their homesteads until they no longer own or occupy that homestead.
Section 403.302, Government Code requires certification of two values—one with only a $5,000 general homestead exemption (T1) and one with the required $15,000 general homestead exemption (T2). The Texas Education Agency uses the T1 value to ensure full reimbursement for school districts that would not otherwise be fully held harmless for the increased losses caused by the additional exemption amount. These school districts receive Tier I state funding only or are budget balanced districts, including Education Code Chapter 41 school districts. The T1 value will not affect funding for other districts.
Section 403.302, Government Code also requires the Comptroller to certify an adjustment for both T1 and T2 for one-half the optional percentage homestead exemption that some school districts grant. These are noted as T3 and T4. The Commissioner of Education may provide for additional funding to these school districts with the optional exemption if (1) funds are specifically appropriated and (2) the appropriated state funds for the Foundation School Program for the school year exceed the state funds distributed to school districts. School districts reported to the Comptroller the value lost for the optional percentage homestead exemption.
School District Summery Worksheet
|Property Category||2003 Final Value Assigned||2004 Local Tax Roll Value||2004 Value Finding to TEA|
|G||Oil, Gas, Minerals||39,476,242,198||51,889,539,655||51,889,539,655||G|
|M||Mobile Homes & Other Personal||5,367,079,189||5,427,726,549||5,427,726,549||M|
|N||Intangible Personal & Uncertified||843,459,207||464,931,396||464,931,396||N|
|Less Total Exemptions:||150,330,147,674||158,438,760,252||158,465,746,162|
|Total Taxable Value:||$1,056,776,725,180||$1,123,537,008,570||$1,123,632,795,591|
Deductions: Section 403.302, Texas Government Code
|2004 Local Tax Roll||2004 Value Finding to TEA|
|Homestead & Disabled Vets||$80,262,334,988||$80,262,334,988|
|Cap Value Loss||9,244,074,465||9,245,633,705|
|Over 65 Freeze Loss||43,344,550,912||43,369,977,582|
Statewide Category D Recap
|2004 Local Tax Roll||2004 Value Finding to TEA|
|Mkt Value of Non-Qualified |
Acres & Farm/Ranch Impvr
|Prod Value of Qualified Acres||11,418,799,368||11,421,901,005|
|Total Category D||$56,080,134,196||$56,084,581,859|
2004 Property Value Study
Final Values Worksheet
S.B. 4, passed by the 1999 Legislature, requires the Comptroller to certify alternative measures of school district wealth (T1, T3 and T4) in addition to the traditional measure (T2). Questions about the extent to which any of these wealth measures affect school funding should be directed to the Division of State Funding at the Texas Education Agency, telephone 512/463-9238.
|T1||Loss to the Additional $10,000 Homestead Exemptions||T2||50% of Loss to Local Optional Percentage Homestead Exemption||T3||T4|
T1 = School District Taxable Value Before the Loss to the Additional $10,000 Homestead Exemption.
T2 = School District Taxable Value After the Loss to the Additional $10,000 Homestead Exemption.
T3 = T1 Minus 50% of the Loss to the Local Optional Percentage Homestead Exemption.
T4 = T2 Minus 50% of the Loss to the Local Optional Percentage Homestead Exemption.