SB322 - Relating to the limitation on increases in the appraised value of certain real property for ad valorem tax purposes.

  89R2999 DRS-D     By: Kolkhorst S.B. No. 322       A BILL TO BE ENTITLED   AN ACT   relating to the limitation on increases in the appraised value of   certain real property for ad valorem tax purposes.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Sections 23.231(c), (d), and (k), Tax Code, are   amended to read as follows:          (c)  This section does not apply to:                (1)  a residence homestead that qualifies for an   exemption under Section 11.13; [ or ]                (2)  property appraised under Subchapter C, D, E, F, G,   or H ; or                 (3)  a mineral interest .          (d)  Notwithstanding the requirements of Section 25.18 and   regardless of whether the appraisal office has appraised the   property and determined the market value of the property for the tax   year, an appraisal office may increase the appraised value of real   property to which this section applies for a tax year to an amount   not to exceed the lesser of:                (1)  the market value of the property for the most   recent tax year that the market value was determined by the   appraisal office; or                (2)  the sum of:                      (A)   10 [ 20 ] percent of the appraised value of the   property for the preceding tax year;                      (B)  the appraised value of the property for the   preceding tax year; and                      (C)  the market value of all new improvements to   the property.          (k)  This section expires December 31, 2031 [ 2026 ].          SECTION 2.  Section 25.19(o), Tax Code, is amended to read as   follows:          (o)  A notice required under Subsection (a) or (g) to be   delivered to the owner of real property other than a single-family   residence that qualifies for an exemption under Section 11.13 must   include the following statement: "Under Section 23.231, Tax Code,   for the [ 2024, 2025, and ] 2026 , 2027, 2028, 2029, 2030, and 2031 tax   years, the appraised value of real property other than a residence   homestead for ad valorem tax purposes may not be increased by more   than 10 [ 20 ] percent each year, with certain exceptions.  The   circuit breaker limitation provided under Section 23.231, Tax Code,   expires December 31, 2031 [ 2026 ].  Unless this expiration date is   extended by the Texas Legislature, beginning in the 2032 [ 2027 ] tax   year, the circuit breaker limitation provided under Section 23.231,   Tax Code, will no longer be in effect and may result in an increase   in ad valorem taxes imposed on real property previously subject to   the limitation."  This subsection expires December 31, 2032 [ 2027 ].          SECTION 3.  Notwithstanding Chapter 1 (S.B. 2), Acts of the   88th Legislature, 2nd Called Session, 2023, the following   provisions are effective January 1, 2032:                (1)  Section 4.02, Chapter 1 (S.B. 2), Acts of the 88th   Legislature, 2nd Called Session, 2023, which amended Section   1.12(d), Tax Code;                (2)  Section 4.05, Chapter 1 (S.B. 2), Acts of the 88th   Legislature, 2nd Called Session, 2023, which amended Sections   25.19(b) and (g), Tax Code;                (3)  Section 4.08, Chapter 1 (S.B. 2), Acts of the 88th   Legislature, 2nd Called Session, 2023, which amended Section   41.41(a), Tax Code;                (4)  Section 4.10, Chapter 1 (S.B. 2), Acts of the 88th   Legislature, 2nd Called Session, 2023, which amended Section   42.26(d), Tax Code; and                (5)  Section 4.12, Chapter 1 (S.B. 2), Acts of the 88th   Legislature, 2nd Called Session, 2023, which amended Sections   403.302(d) and (i), Government Code.          SECTION 4.  Sections 23.231(c) and (d), Tax Code, as amended   by this Act, apply only to the appraisal of real property for ad   valorem tax purposes for a tax year that begins on or after the   effective date of this Act.          SECTION 5.  (a)  Except as otherwise provided by this   section, this Act takes effect January 1, 2026.          (b)  Sections 23.231(d) and (k) and 25.19(o), Tax Code, as   amended by this Act, and Section 3 of this Act take effect January   1, 2026, but only if the constitutional amendment proposed by the   89th Legislature, Regular Session, 2025, to authorize the   legislature to set a lower limit on the maximum appraised value of   real property other than a residence homestead for ad valorem tax   purposes and to postpone the expiration of the limit is approved by   the voters.  If that amendment is not approved by the voters,   Sections 23.231(d) and (k) and 25.19(o), Tax Code, as amended by   this Act, and Section 3 of this Act have no effect.