- CADs Handle 15 Million Properties for About 3,600 Taxing Units
- Rylander Reports
- Annual Property Tax Conference Program
- Joint Conference Pre-Registration Form
- PTD Staff Clarifies Fencing Cost Method and Adjustments
- Penalty and Interest Charges for Delinquent Tax Collections
- Penalty and Interest Rate Schedule - 1999/2000
- Insert: 1999 Texas Property Tax Law Changes (continued)
Chapter 22. Reports and Renditions
Section 22.24Chapter 23. Special Appraisal
S.B. 1359 amends Subsection (e) to require the Comptroller's rendition forms to provide for the person filing the form to swear that the information provided in the rendition is true and accurate "to the best of the person's knowledge and belief." Current law requires that the person swear that the information is true and accurate. Effective September 1, 1999.
Section 23.0101Chapter 25. Appraisal
S.B. 1641 amends Section 23.0101 to require the chief appraiser to use the most appropriate appraisal method in determining market value. Current law requires the chief appraiser to use the method the chief appraiser "considers" the most appropriate. Effective January 1, 2000.
S.B. 1641 amends Section 23.013 to require the chief appraiser, in applying the market approach to value, to use comparable sales data. Current law requires the chief appraiser to use comparable sales data, "if possible." Effective January 1, 2000.
H.B. 3033 amends Subsection (f) to provide that for purposes of the vehicle inventory tax (VIT), a motor vehicle dealer is presumed to have commenced business on the date of issuance of a dealer's general distinguishing number (GDN). A chief appraiser would have the discretion to designate a different date. Effective June 19, 1999.
H.B. 3033 amends Subsection (c) to allow the Texas Department of Transportation access to otherwise confidential VIT dealer information for use in auditing dealer licensee compliance. Effective June 19, 1999.
S.B. 521 repeals Subsection (h) that required a chief appraiser to report to the Comptroller a dealer who failed to file an annual declaration of heavy equipment inventory or if, on the declaration, reported the sale of fewer than five items of heavy equipment in the preceding year. Effective June 18, 1999.
S.B. 1435 amends Subsections (a)(2), (a)(7), and (b) for the appraisal of heavy equipment inventory. The bill amends Subsection (a)(2) to provide that the term "dealer's heavy equipment inventory" includes items of heavy equipment that are leased or rented but subject to a purchase option by the lessee or renter. The bill amends Subsection (a)(7) to define "sales price" for a lease or rental with an option to purchase, as the total amount of the lease or rental payments plus any final consideration, excluding interest. Subsection (b) provides that a sale of heavy equipment is considered to have occurred when possession of an item of heavy equipment is transferred from the dealer to the purchaser. Effective January 1, 2000.
H.B. 3197 amends Subsections (a), (e), and (h) to define "HUD-code manufactured home" and "mobile home" consistent with their definitions in Article 5221f, VTCS. The bill also amends Subsections (a), (b), (e), (f), and (g) to substitute the term "unit of manufactured housing" for the term "manufactured home." Effective January 1, 2000.
H.B. 3197 amends Subsections (a) through (i) to substitute the term "unit of manufactured housing" for the term "manufactured home." Effective January 1, 2000. It also provides that a retail manufactured housing dealer is not liable for penalties and interest if the county TAC fails to transfer inventory taxes to taxing units before the delinquency date. Effective September 1, 1999.
Sections 23.21 and 23.22
S.B. 1368 combines Sections 23.21 and 23.22, added by Chapter 980 of the 75th Texas Legislature to address property used to provide affordable housing, to be numbered Section 23.21. The bill also renumbers Section 23.21 added by Chapter 1039 of the 75th Texas Legislature to be Section 23.22. Effective September 1, 1999.
S.B. 1464 adds Section 23.24 to provide that if real property is appraised by a method that takes into account the value of furniture, fixtures, and equipment in or on real property, the furniture, fixtures, and equipment shall not be subject to additional appraisal or taxation as personal property. Effective September 1, 1999.
S.B. 521 repeals Subsections (c) and (d) requiring the Comptroller to compile, publish, and distribute to appraisal districts agricultural information and schedules for use in classifying agricultural land and calculating average net income for each type of agricultural operation. Effective June 18, 1999.
H.B. 958 amends Subsection (f) to provide that the rollback tax for the change of use for open space land does not apply to a change of use occurring as a result of a transfer of land to the state or a political subdivision of the state to be used for a public purpose. Effective June 19, 1999.
S.B. 977 amends Subsection (g) to provide that rollback taxes for a change of use to timber land qualifying under the new Subchapter H does not attach if the land qualified under Subchapter C (agricultural appraisal) or Subchapter D (timber appraisal). Effective January 1, 2000.
Sections 23.9801 through 23.9807
S. B. 977 adds a new Subchapter H to Chapter 23 providing for special appraisal of Restricted Use Timber Land. New appraisal methods would apply where timber harvesting is restricted: (1) for aesthetic or conservation purposes, including maintenance of standing timber adjacent to highways and roads and to preserve forests designated by the Texas Forest Service as special and unique (aesthetic management zones); (2) to provide benefits or protections for plant or animal wildlife designated as endangered or threatened under the federal Endangered Species Act or the Parks and Wildlife Code (critical wildlife habitat zones); or (3) to protect water quality or preserve a waterway, including a lake, river, stream, or creek (streamside management zones). Land would also qualify for appraisal under this new subchapter if it is regenerated for timber production following a harvest occurring in a year for which the land was appraised under Subchapter E appraisal provisions for timber land. Land would cease to qualify for appraisal under the new subchapter on the tenth anniversary of the date the timber is harvested. Restricted-use timber land will be appraised at one-half of the appraised value as determined under current appraisal methodology for timber land and the appraised value can not exceed the lesser of the market value of the land determined by other methods or the appraised value of the land for the year preceding the first year of appraisal under the new subchapter. The owner of land appraised under the new subchapter will be required to notify the chief appraiser if the land's eligibility ends, subject to a penalty equal to 10 percent of the difference in appraised value under the new subchapter and the appraised value under Subchapter E. The chief appraiser will be allowed to impose the penalty to any year in which the land was ineligible but received appraisal under the new subchapter. An application for restricted-use timber land appraisal must be made to the chief appraiser before May 1 on a Comptroller prescribed form accompanied by evidence that the land qualifies as an aesthetic management, critical wildlife habitat, or streamside zone or that it has been regenerated to the degree generally accepted in the area for commercial timber land and with an intent to produce income. For good cause, the chief appraiser could extend the filing deadline for up to 15 days. The chief appraiser could request additional information and the applicant would be required to provide the information within 30 days, plus a 15 day extension for good cause. An application could be denied. Before denying an application for failure to qualify as an aesthetic management, critical wildlife habitat, or streamside management zone, the chief appraiser would be required to obtain a determination letter from the director of the Texas Forest Service as to the type, location, and size of the zone, if any, in which the land is located. If the director concludes the land is in a qualifying zone, the chief appraiser would approve the application. The directors determination would be conclusive and local appraisal review board and judicial remedies would not apply. Once an application is approved, the land would be eligible for appraisal as restricted-use timber land in subsequent years, without a new application. A new application would be required if ownership changed, standing timber was harvested, the land's eligibility ends, or the chief appraiser has good cause to believe the land's eligibility has ended. A change in the use of restricted-use timber land would result in the imposition of a rollback tax. If the change in use is from restricted-use timber land to a qualifying use under Subchapter E, the additional tax would be the difference between the taxes imposed for each of the five preceding years and the taxes that would have been imposed had the land been appraised under Subchapter E. If the change in use does not qualify the land for appraisal under Subchapter E, the additional tax would be the difference between the taxes imposed for each of the preceding years and the taxes that would have been imposed had the land been appraised at market value. Harvesting timber from land appraised as restricted-use land within the 10-year eligibility period would constitute a change in use. Effective January 1, 2000.
Section 25.02Chapter 26. Assessment
S.B. 977 amends Subsection (a) to require appraisal records to include the appraised value of land qualifying under the new Subchapter H, Chapter 23 (Appraisal of Restricted-Use Timber Land). Effective January 1, 2000.
H.B. 3549 adds Subsection (b) to provide that real property subject to an installment contract of sale shall be listed in the name of the seller if the installment contract is not filed of record in the real property records of the county, unless otherwise provided in writing under Tax code Section 1.111(f). Effective January 1, 2000.
S.B. 694 amends Section 25.19 to require the chief appraiser to deliver a clear and understandable written notice of appraised value to a property owner and deletes from the required notice of appraised value the following information: (1) the effective tax rate that would be announced pursuant to Chapter 26 (the notice would include the amount of tax that would be imposed on the property on the basis of the tax rate for the preceding year); (2) a statement that the governing body of the taxing unit is prohibited from increasing property tax revenues without public notice and a public hearing to discuss the proposed increase; (3) an explanation that a taxpayer who objects to increasing property taxes and government expenditures should complain to the taxing unit governing bodies and only complaints about value should be presented to the appraisal office and the ARB; and (4) requirements that the chief appraiser enclose effective tax rate and other information in a required rectangle format in boldfaced type. The chief appraiser includes taxes that would be imposed based on last year's tax rate. The bill amends this section to require that the notice be in the form of a letter. Effective January 1, 2000.
H.B. 954 amends Subsection (b) to change the wording on one of the sentences on the notice of appraised value that the governing body may not adopt a rate that will increase tax revenues "for operating purposes from properties taxed in" the preceding year without publishing notice in a newspaper. Effective January 1, 2000.
S.B. 977 amends Subsection (a) to prohibit the chief appraiser from submitting appraisal records to the ARB until the chief appraiser has delivered notices of denial of appraisal of restricted-use timber land. Effective September 1, 1999.
S.B. 435 amends Subsection (a) to require the chief appraiser, after submitting appraisal records to the ARB, to prepare supplemental appraisal records listing property that qualifies for a percentage homestead exemption under Section 11.13(n) that was adopted by a taxing unit after the date the appraisal records were submitted. Effective June 19, 1999.
Section 26.01Chapter 31. Collections
H.B. 98 adds Subsection (d) to provide that by June 15, the chief appraiser shall prepare and certify to each school district assessor in the appraisal district an estimate of the school district's taxable property value. The chief appraiser shall assist the school district in determining school district property values for the school's budget. Effective September 1, 2001.
S.B. 1804 adds Subsections (k) through (q) to provide for increasing and decreasing the rollback tax rates of taxing units that agree by written contract to transfer part of a responsibility for funding a distinct department, function, or activity from one unit to another unit. "Funding" includes a payment made to another taxing unit in accordance with a written contract for the operation of the department, function, or activity, but does not include a payment made by a taxing unit from funds received from another taxing unit in accordance with a written contract to operate the department, function, or activity. The unit shall publish a schedule that includes the name of each taxing unit and the amount of property tax spent to operate the department or function in the 12 months preceding the month of the tax rate calculations. The new subsections expire January 1, 2001. Effective August 30, 1999.
H.B. 954 amends Subsection (e) to require taxing units to publish a statement that adopting a tax rate equal to the effective tax rate would result in an increase or decrease, as applicable, in the taxes imposed by the taxing unit as compared to last year's taxes, and the amount of the increase or decrease. Effective January 1, 2000.
H.B. 2075 amends Subsection (e) and adds Subsection (e-1) to state that the notice requirements of Section 26.04 do not apply to school districts. School districts follow the budget and proposed tax rate notice found in amended Education Code Section 44.004. Effective August 30, 1999.
H.B. 1398 adds Section 26.0441 to provide that a taxing unit adopting a tax rate after January 1, 2000 may increase its effective maintenance and operations (M&O) rate to include a rate that covers enhanced indigent health care expenditures established under Health and Safety Code Section 61.006. In each subsequent tax year, if the taxing unit's enhanced indigent health care expenses exceed the amount of those expenses for the preceding year, the taxing unit may increase its effective M&O rate to cover the additional expenses. The taxing unit includes a notice of the increase in its effective M&O rate, with a brief description and the amount of the enhanced indigent health care expenditures in the notices published under Section 26.04(e) and, if applicable, Section 26.06(b). "Enhanced indigent health care expenditures" for a tax year means the amount spent by the taxing unit for the M&O costs of providing indigent health care at the increased minimum eligibility standards established under Section 61.006, Health and Safety Code, effective on or after January 1, 2000, in the period beginning on July 1 of the year preceding the tax year for which the tax is adopted and ending on June 30 of the tax year for which the tax is adopted, less the amount of state assistance received by the taxing unit in accordance with Chapter 61, Health and Safety Code, that is attributable to those costs. For the 2000 and 2001 tax years, a taxing unit's enhanced indigent health care expenditures for the 2000 tax year are computed using the taxing unit's expenditures for the M&O costs of providing indigent health care at the increased minimum eligibility standards for the period beginning on January 1, 2000, and ending on June 30, 2000, and this subsection expires January 1, 2002. Effective September 1, 1999.
S.B. 1118 amends Subsection (a) and (c) to require a taxing unit to adopt its tax rate before the later of September 30 or the 60th day after the date the chief appraiser certifies the appraisal roll to the taxing unit. If the taxing unit does not adopt by these required dates, the unit shall adopt the lower of its effective tax rate calculated for that tax year or last year's tax rate. The governing body must ratify that rate within five days of establishing the rate. Effective January 1, 2000.
H.B. 954 amends Subsection (d) to require a taxing unit to hold a public hearing and publish newspaper notices before adopting a tax rate if the proposed rate exceeds the lower of the rollback tax rate or 103 percent of the effective tax rate. Effective January 1, 2000.
H.B. 2075 amends Subsection (d) to provide that the subsection does not apply to a school district for adopting a tax increase. Effective August 30, 1999.
H.B. 1520 adds Section 26.052 to provide for a simplified tax rate notice for taxing units with low tax levies. This new section applies to a taxing unit with a total proposed tax rate for the current year of 50 cents or less per $100 of taxable value that would impose taxes of $500,000 or less when applied to the unit's current total value. This taxing unit is exempt from Sections 26.04(e), 26.04(g), 26.05(d), 26.05(e), and 26.06 if it uses the simplified notice. At least seven days before the meeting to adopt the tax rate, the simplified notice must either be mailed to each property owner or published in the legal notices section of a newspaper having general circulation in the taxing unit. The notice contains the proposed tax rate and the date, time, and place of the meeting to consider adopting the rate. It also includes a statement that the proposed rate will increase total taxes by a calculated percentage if the proposed rate exceeds the unit's effective tax rate. Effective May 28, 1999.
H.B. 954 amends Section 26.06(a), (b), (d), and (e) on the notice for publishing a tax increase. The wording on the Notice of Public Hearing on Tax Increase and the Notice of Vote on Tax Rate will change. The percentage printed on the notices will be "percentage by which the proposed tax rate exceeds lower of rollback tax rate or effective tax rate calculated under this chapter." Effective January 1, 2000.
H.B. 2075 adds Subsection (g) to provide that this section does not apply to a school district in adopting its tax rate. School districts follow a public hearing process provided in Education Code Section 44.004. Effective August 30, 1999.
H.B. 954 adds Section 26.065 to require supplemental notices of the hearing on a tax rate increase. A taxing unit that owns, operates, or controls an Internet website shall post notice of the public hearing on the tax rate increase on its website. The unit must post the notice continuously for at least seven days immediately before the public hearing and at least seven days before the date of the vote proposing the tax rate increase. A taxing unit that has free access to a television channel shall request that the station carry a 60-second notice of the public hearing. The notice must appear at least five times a day between the hours of 7 a.m. and 9 p.m. for at least seven days immediately before the public hearing and at least seven days before the date of the vote proposing the tax rate increase. Both of these requirements state that the notice must contain substantially the same information found on the Notice of Public Hearing on Tax Increase. A taxing unit does not have to comply with the supplemental notice(s) because of the failure of an electronic or mechanical device (including a computer or server) or because of circumstances beyond its control. A property owner is not entitled to seek an injunction to stop the unit from collecting taxes if the unit has, in good faith, attempted to comply with this new section. Effective January 1, 2001.
S.B. 4 repeals Subsection (f), amends Subsection (i), and adds Subsections (j) through (n) on the calculating of a school district's rollback tax rate. While the formulas in the subsections provide for 6 cents to be added to the maintenance and operations rate, Subsections (k) and (l) provide for only 3 cents for tax year 1999. The calculations are different for Education Code Chapters 41 and 42 school districts. Subsections (k) through (n) expire September 1, 2000. Effective September 1, 1999.
S.B. 1368 amends Subsection (b) to correct the prorated tax calculation when a residence homestead exemption for an over-65 homeowner terminates during the year. Effective September 1, 1999.
H.B. 3549 amends Subsections (a) and (b) and adds Subsection (c) to delete the provision requiring the prorating of taxes when an over-65 homeowner qualifies for a residence homestead exemption provided for in Section 11.13 (c) or (d). Effective January 1, 2000.
H.B. 3549 amends Subsection (a) to refer to Tax Code Section 11.42(d) for the prorating of taxes. Effective January 1, 2000.
S.B. 307 amends Subsection (a) to require that the exterior of a tax bill must contain the statement "RETURN SERVICE REQUESTED" in capital letters, or another appropriate statement directing the United States Postal Service to return the tax bill if it is not deliverable as addressed. Current law requires "ADDRESS CORRECTION REQUESTED." Effective September 1, 1999.
S.B. 977 amends Subsections (c) and (d) to require that the tax bill shall state the market value and taxable value if the property is land receiving special appraisal under Tax Code Chapter 23, including the new Subchapter H, Chapter 23 (Appraisal of Restricted-Use Timber Land), and the amount of any penalty imposed. Effective September 1, 1999.
H.B. 51 adds Section 31.035 to permit a homeowner 65 years of age or older to perform services for a taxing unit in lieu of paying homestead property taxes owed by the person. The taxing unit's governing body shall determine the number of homeowners permitted to perform services and the maximum number of hours of service that a homeowner may perform. The homeowner and the taxing unit must execute a contract to perform services in lieu of the property tax payment before the homestead's taxes become delinquent. The contract shall specify the nature of the service, the facility or location, the number of hours, and the time of service. Credit for each hour of service will be at the federal minimum wage rate. As long as the contract is in effect, the homestead taxes do not become delinquent. The property owner must perform the service no later than one year after the delinquency date for that tax year. The taxing unit may terminate the contract if the person fails to perform the service or the unit determines that the service is unsatisfactory. The homeowner may not be an employee of the taxing unit and is not entitled to any employee benefits, including worker's compensation coverage. The unpaid taxes become delinquent and incur penalty and interest. Property owners performing these services may only supplement or complement the regular personnel; the taxing unit may not reduce its number of employees for these services. The taxing unit is not liable for any damages arising from an act or omission of the person in performing services and the person is not entitled to indemnification from the taxing unit for injury or property damage that the person sustains while performing services for the unit. Effective August 30, 1999.
H.B. 51 adds Section 31.036 to provide that a school district's board of trustees by resolution may permit qualified individuals to perform teaching services for the school district at a junior or senior high school in lieu of paying their homestead taxes. The school board determines the number of qualified individuals who will be permitted to perform teaching services, the courses that they may teach, and the amount of tax credit that may be earned. Each individual must execute a contract with the school district before the delinquency date and must specify in the contract the course or courses, the school, the semester, and the amount of tax credit. The maximum credit for an entire school semester is $500, except where a student receives a full year's credit for one semester, the maximum credit is $1,000 for each such course taught. A qualified homeowner may not receive credits for teaching more than two courses in any school year. The qualified homeowner may not be an employee of the district; is not entitled to any employee benefits, including workers' compensation coverage; must hold a baccalaureate or more advanced degree in a field related to the course taught; and, must be certified as a classroom teacher or obtain a school district teaching permit. The district may terminate the contract if the person fails to perform teaching services or provides unsatisfactory teaching services. Effective August 30, 1999.
H.B. 51 adds Section 31.037 which provides that a school district may authorize a corporation or other business entity to permit the corporation or entity's qualified employees to perform teaching services in a junior high or senior high school in lieu of paying taxes imposed by the district against property owned by the business entity. The school board shall determine the number of businesses that will be eligible for such a tax credit, the courses that may be taught, and the amount of tax credit. The business's employee shall execute a contract with the school district before the delinquency date to specify the course to teach, the school, the semester, and the amount of tax credit. The maximum credit for an entire school semester is $500, except where a student receives a full year's credit for one semester, the maximum credit is $1,000 for each such course taught. The qualified business' employee may not also be an employee of the school district or have a contract under Section 31.036; is not entitled to any employee benefits, including workers' compensation coverage; must hold a baccalaureate or more advanced degree in a field related to the course taught; and, must be certified as a classroom teacher or obtain a school district teaching permit. The district may terminate the contract for failure to perform the teaching services or for unsatisfactory services. Effective August 30, 1999.
S.B. 779 amends Subsection (a) to allow a tax collector by written agreement to accept payment by electronic funds transfer. The collector and a taxpayer may enter into a written agreement, signed by both parties, and specifying the means or format of payment by electronic funds transfer. Effective June 18, 1999.
H.B. 3549 adds Section 31.081 regarding the purchase of a business from a seller who is liable for personal property taxes on property used in the business. The purchaser is required to withhold from the purchase price sufficient money to pay the personal property taxes, plus any penalty and interest, of the business unless the seller has provided the purchaser with either a tax receipt from the taxing units showing that all of the business personal property taxes, plus any penalties and interest incurred, have been paid or tax certificates showing that no taxes, penalties, or interest are due. A purchaser who fails to withhold these amounts is liable to the taxing units for an amount up to the purchase price. The purchaser may request a tax certificate or statement from each taxing unit. If the tax collector does not issue the tax certificate or statement within 10 days, the purchaser will be released from all liability. This release would not affect the personal liability of the seller. An action to enforce the purchaser's liability must be brought before the fourth anniversary of the purchase date. Effective January 1, 2000.
H.B. 2220 amends Subsection (a) to provide that the governing body of a taxing unit that collects taxes for another unit shall determine if a payment was erroneous or excessive and approve a refund if the amount of refund exceeds $2,500 to be paid by a county with a population of 2.8 million or more, or $500 for a refund to be paid by any other taxing unit. Effective September 1, 1999. S.B. 446 amends Subsection (c) and adds Subsections (d), (e), and (f) for the application for a tax refund. Subsection (c) provides that a taxpayer may apply for a refund by using a form prescribed by Comptroller rule or by a written request with sufficient information to enable the auditor for the taxing unit and the taxing unit's governing body (if applicable) to determine entitlement to the refund. Subsection (d) provides that the collector shall make the application form available upon request and without charge. Subsection (e) provides that the refund application contain an affirmation that the information is true and correct and be signed by the taxpayer. Subsection (f) provides that for a refund required to be approved by the governing body of a taxing unit, the presiding officer of the taxing unit's governing body is not required to sign the approval or disapproval of the refund. The tax collector shall indicate on the application that the governing body approved or disapproved the refund and the date of approval or disapproval. Effective September 1, 1999.
H.B. 2220 amends Subsection (b) to provide that a liability for a refund arises, if the refund required by Section 31.11, on the date the auditor for the unit determines that the payment was erroneous or excessive or, if the amount of the refund exceeds the amounts specified in Section 31.11(a), on the date that the governing body approves the refund. Effective September 1, 1999.
Tax Law Changes (continued)