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Texas Legislative Summary

Detailed Legislative Changes to Property Taxes

Constitutional Amendment

  • Legislature may provide for the appraisal of a residence homestead on its use as a residence rather than on its highest and best use. (Article VIII, Section (j), Constitution)((HJR 36)

  • Legislature may authorize a single board of equalization for two or more adjoining counties. (Article VIII, Section 18, Constitution)( HJR 36)

  • Provides that administrative and judicial enforcement of uniform standards and procedures for appraisal shall be prescribed by general law and deletes the requirement that enforcement originate in the county where the tax is imposed. (Article VIII, Section 23, Constitution)( HJR 36)

Taxpayer Remedies

  • Provides that the deadline for filing a lawsuit is changed from 45 days after receipt of the ARB order to 60 days. (Section 42.11,HB 986,, Effective 6/19/09)

  • Provides that a taxpayer is entitled to receive attorney fees under Section 42.29 in an appeal under Section 25.25. (Section 42.29,HB 1030,, Effective 6/19/09)

  • Creates an alternative appeal of an ARB order to the State Office of Administrative Hearings. This would apply to property over $1,000,000 in Bexar, Cameron, El Paso, Harris, Tarrant and Travis counties and would be limited to the first 3000 appeals filed. This is an alternative to an appeal to district court and there is no appeal from SOAH to district court. (Government Code, Chapter 2003, HB 3612,, Effective 1/1/10)

  • Provides that in an arbitration appeal only one arbitration deposit is required for two or more contiguous tracts of land. (Section 41A.03,HB 4412; Effective: 9/1/09)

  • Provides that all residence homesteads not just ones less than $1 million are eligible for arbitration. Provides an expedited arbitration with a fee of $250. Requires additional continuing education for arbitrators. (Chapter 41A, SB 771; , Effective 1/1/10)

  • Provides that on a motion to determine compliance with the payment requirements of Section 42.08, notice of the hearing must be provided to the taxing units. Provides that a taxing unit may intervene in a compliance hearing. (Section 42.08, SB 1359, Effective 6/19/09)

Comptroller Provisions

  • Provides that the Comptroller shall prepare additional training material and courses for ARB members and that the ARB members must take the training or are not eligible for reappointment to the ARB. (Section 5.041, HB 2317; Effective: 9/1/09)

  • The Comptroller will conduct a property value study every two years in a district in which the (Government Code ,HB 8, Effective:1/1/10)study finds that the local value was valid and a study each year if the local value is found not valid.

  • At least once every two years the Comptroller will conduct a performance audit of each appraisal district. A Property Value Study Advisory Committee is created. The Texas Department of Licensing and Regulation shall ensure that recommendations of the performance audit are implemented. (Sections 5.07, 5.102, 5.12, 5.13,HB 8, Effective 1/1/10)

Property Tax Representation

  • Designation of an agent must be on a Comptroller form and must be signed by a person other than the person being designated. The designation takes effect upon filing with the district and is timely if filed at or before the ARB hearing. (Section 1.111) (HB 1203; , Effective 5/26/09)

  • If a person exempt from registration as a tax consultant files a protest, the person is entitled to receive all notices related to the property. (Section 1.111, HB 1030, Effective 6/19/09)

  • Regulations relating to tax consultants were significantly changed. They include:
    1. A beginning tax consultant must pass 40 hours of education classes and pass a competency exam;
    2. A Senior may not sponsor more than 10 consultants unless the consultants have more than six months experience;
    3. A consultant may not:
    a. file a protest without client approval,
    b. falsify a document filed with the district or taxing unit,
    c. solicit a property tax assignment by assuring a specific outcome,
    d. use a misleading website,
    e. engage the services of an attorney without prior client consent
    (Occupations Code, chapter 1152)(HB 2591, Effective (1) above 9/1/9, (2) & (3) above 1/1/10)

Appraisal District Operations

  • Appraisal of property must consider available evidence specific to the property in determining market value. If the value is determined in a year by agreement, protest or lawsuit, the value may not be increased in the subsequent year without substantial evidence to support the increase. A sale must be within 24 months of valuation date to be considered comparable unless there are insufficient sales. Sets forth items for determining whether a property is comparable. (Section 23.01, 23.013, SB 771, , Effective 1/1/10)

  • Provides that if a chief appraiser values a property based on the income approach, the value includes both the real property and the personal property. (Section 23.24, SB 771,, Effective 1/1/10)

  • Licensing and regulations of appraisal district and taxing unit employees is transferred from BTPE to the Texas Department of Licensing & regulation. BPTE is sunsetted. (Occupations Code Chapter 1151, Section 5.04, HB 2447, Effective 6/19/09)

  • Sales information provided to an appraisal district by a third party is currently confidential. This information is made public in counties of less than 20,000. (Section 552.148 Gov. Code, (HB 1813; Effective 9/1/09)

  • Chief appraiser is required to give assistance to emergency management authorities upon request. (Section 6.053, SB 2148, Effective 6/19/09)

  • Provides that home address in appraisal records of justice of the peace is confidential. (Section 25.025, HB 559, Effective. 9/1/09)

  • Appraisal records containing address of a judge are confidential. Adds the spouse of judge to this provision. (Section 25.025)(SB 281, Effective: 9/1/09)

  • Provides that a taxing unit employee may obtain otherwise confidential information to assist in reviewing the operations of an appraisal district and a school district employee may obtain confidential information for purposes of the Comptroller's value study. (Section 22.27, Government Code, chapter 552, HB 2941, Effective: 6/19/09)

  • Requires that special inventory tax statements must be filed monthly regardless of whether sales occurred. (Sections 23.121,23.122,23.124,23.1241,23.1242,23.125,23.127, 23.128, HB 2071 , Effective: 9/1/09)

ARB Provisions:

  • Provides that a homeowner can file an electronic protest and receive settlement offers electronically. Applies to counties over 500,000. Not required to make this available to homeowners represented by agents. (Section 41.415, HB 1030, Effective: 1/1/10)

  • (Similar to above)Provides that a homeowner can file an electronic protest and receive settlement offers electronically. Applies to counties with a website. Not required to make this available to homeowners represented by agents. (Section 41.415,SB 873, Effective: 1/1/11)

  • Property owner may obtain a postponement of a hearing for good rather than reasonable cause. Good cause is a mistake that was not intentional or the result of conscious indifference and will not cause undue delay. (Section 41.45, HB 1030, Effective 1/1/10)

  • Provides that the Comptroller shall prepare additional training for ARB members and that the ARB members must take the training or are not eligible for reappointment to the ARB. (Section 5.041,HB 2317; Effective: 1/1/09)

  • Board of Directors selects the Chairman and Secretary of the ARB. The Board is encouraged to select a Chairman with experience in law and property tax. (Section 6.42) (HB 2317; Effective: 9/1/09)

  • In Harris county and apparently Montgomery and FT Bend counties, members of the board of directors are appointed by the local administrative district judge. (Section 6.41,HB 1030, Effective: 1/1/10)

  • Authorizes two or more adjoining appraisal districts to use a consolidated ARB. (Section 6.41,HB 3611, Effective:1/1/10 upon passage of constitutional amendment)

Tax Collections & Refunds

  • Provides that a taxing unit must send a refund to the person and address provided to a taxing unit in a Comptroller form or agreed judgment. (Section 42.43, HB 986; Effective: 6/19/09)

  • Provides that a collector needs governing body approval for a refund of $5000 in a county of 2 million or greater rather than $2500 in a county of 1.5 million or greater. (Section 31.11, HB 1205; Effective: 1/1/10)

  • Provides that businesses with less than $5 million in gross receipts may pay taxes on property in a disaster area in installments. Currently applies only to homesteads and not businesses. (Section 31.032)(HB 1257; Effective: 6/19/09)

  • Provides in truth in taxation a statement of by what percentage the proposed tax rate exceeds the effective tax rate. (Section 26.05,HB 2291, Effective: 6/19/09)

  • Authorizes, rather than requires, the tax assessor-collector to request the return of a tax bill that is not deliverable as addressed through certain methods.(Section 31.01, SB 562, Effective 9/1/09)

  • Requires the tax collector, rather than the taxing unit's auditor, to make the determination as to whether an overpayment or erroneous payment of taxes has been made by the taxpayer. The tax collector's determination must be made with the auditor's agreement.(Section 31.11,SB 796; effective 1/1/10)

  • A collector for a unit in a county over 2,000,000 in population must refund an amount between $5 and $5000 without an application however the collector does not have to refund if there are taxes owed unless the amount of the refund exceeds the taxes owed by $5000. .(Section 31.11,SB 796; effective 1/1/10)

  • Provides that the three year limitation for refunds contained in section 31.11 does not apply to late application for exemption for a veteran's organization exemption. (Section 11.438,SB 798; effective 1/1/10)

Delinquent Taxes

  • Sets forth new provisions related to redemption of real property sold at a property tax sale. Requires an owner of real property to state in the affidavit that the owner's redemption period has not expired, thus absolving the assessor-collector of making fact determinations regarding that issue. Reinforces that an assessor-collector is not liable for acting in reliance upon the statements made in the affidavit. (Section 34.21, HB 1407; Effective:9/1/09)

  • Requires a taxing unit to also join a tax lien transferee when it files suit to foreclose its own lien for delinquent property taxes. Once joined, a transferee is entitled to foreclose its lien, notwithstanding the current law that generally prohibits the same within one year of the date on which the lien is recorded and regardless of whether the loan secured by the lien is delinquent. (Section 32.06, 33.445) (HB 1465; Effective:9/1/09)

  • Authorizes the service process for nonresident defendants in delinquent tax collection cases to be in the same manner that nonresident defendants in a suit on a business transaction or tort may currently be served (Civil Practices & Remedies Code, HB 1804, Effective:9/1/09)

  • Relates to disposition of excess proceeds in tax foreclosure proceedings. (Section 34.021, 34.04,HB 406; Effective:9/1/09)

  • Authorizes the commission to examine the place of business of property tax lenders and access records in order to investigate compliance with laws and regulations of Texas. Require an audit of the property tax lender's net assets, and prescribes the filing document necessary when a property tax lender pays property taxes for another person.(Chapter 351, Finance Code, SB 1620, Effective:9/1/09)

Exemptions

  • Provides an exemption for a facility for the homeless with a disabling condition provided the facility is owned by an organization in existence for ten years and located in a city between 600,000 and 700,000 in population. (Section 11.18, HB 2628; Effective:1/1/10)

  • Provides for continuation of a homestead exemption, the tax freeze and application of the homestead cap on property destroyed by wind or water damage. (Contained in two bills. Section 11.135, 11.26, 11.261, 23.23, HB 1257; Effective: 6/19/09); (Section 11.135)(HB 770; Effective: 1/1/10)

  • Provides exemption for nonprofit community business organization providing economic development to the local community. Qualify for exemption upon acquisition of the property and continue to qualify after initial application. (Section 11.231, 11.42, HB 770, Effective:1/1/10)

  • Clarifies qualification for a property tax exemption by a charitable organization that provides support to the handicapped includes qualification through the provision to the handicapped of training and employment in the production of commodities or in the provision of services under the federal Javits-Wagner-O'Day Act relating to the blind and severely disabled. (Section 11.18,SB 2442, Effective: 1/1/10)

  • Exempts real property owned by a charitable organization and leased to an institution of higher education to the same extent as if the property were owned by the institution. (Section 11.18, SB 2442, Effective: 1/1/10)

  • Extends the time period from three to five years that a charitable organization may hold property on which housing is built with volunteer labor to sell to qualified low income families. (Section 11.181,HB 2555, Effective: 6/19/09)

  • Extends a charitable exemption to property owned by corporation that is not a qualified charitable organization, if certain conditions are met. (Section 11.184, HB 2555, Effective: 1/1/10)

  • Provides the exemption application for motor vehicles not held for the production of income is a one time application rather than an annual application. (Sections 11.43, 11.253, 11.254, 22.01,HB 2814, Effective: 1/1/10)

  • Provides that a taxpayer can qualify for wildlife management appraisal based on a conversion from timber use. (Section 23.51, 23.52, 23.56,SB 801, Effective: 1/1/10)

Abatements & TIFS

  • Extends the Property Redevelopment and Tax Abatement Act from 2009 to 2019. (Tax Code Chapter 312, HB 773, Effective: 6/19/09)

  • Allows noncontiguous areas of counties and cities, as well as area in the extraterritorial jurisdiction of cities, to be designated as a reinvestment zone, thus giving the counties and cities greater flexibility and discretion in bringing economic development to their communities. Currently, counties and cities can only designate a contiguous geographic area as a reinvestment zone, and the statute is unclear in regards to a municipality's authority to establish a zone that covers area in its extraterritorial jurisdiction. (Tax Code Chapter 311, HB 1770, Effective: 6/19/09)

  • Modifies the program at the Texas Commission on Environmental Quality(TCEQ) which determines property tax exemptions for certain pollution control property. Requires TCEQ to use its own cost analysis procedure when making a use determination for equipment listed in Section 11.31(k) of the Texas Tax Code (Tier IV). Require the creation of a permanent advisory committee. Specifies that these changes in law apply to use determinations that are not final before the effective date of the bill and to applications filed after January 1, 2009. Use determinations that are final as of the effective date of the bill or were filed before January 1, 2009 are governed by the law in effect prior to this bill. (Section 11.31,HB 3206, Effective:9/1/09)

  • Extend the expiration date for Chapter 312 abatements from September 1, 2009 until September 1, 2019. Allows cities and counties to defer the commencement of the 10-year abatement period for an unspecified length of time mutually agreed upon by the taxing unit and the taxpayer. Clarifies current language that allows abatements of real property, personal property, and leasehold interests. Ratifies and validates agreements made before the effective date of the bill. (Tax Code, Chapter 312, HB 3896 Effective: 6/19/09)

  • Towns are able to revitalize their main streets through participation in either the Main Street Improvement Program or the Downtown Revitalization Program, administered by the Texas Department of Agriculture (TDA). Authorizes the governing body of a municipality, with a population of less than 10,000, to limit municipal taxes that may be imposed on real property in an area that has been approved for funding under the programs administered by TDA. (Section 11.34, SB 252; Effective: 6/19/09)

  • Allows the use of TIF funds for the construction of infrastructure leading into or out of the zone, including the purchase of real property necessary to build that infrastructure. Allows a municipality to grant a tax exemption to the owners of historic property within a TIF in lieu of paying a portion of its tax increment into the TIF fund. (Chapter 311 Tax Code, SB 576, Effective: 6/19/09)

  • Authorizes a municipality to designate a termination date for a reinvestment zone that is later than the date designated by the ordinance that created the zone. This bill applies only to a reinvestment zone created by certain municipalities and provides terms for a termination date. (Chapter 311, Tax Code, SB 1105, Effective 5/23/09)

  • Clarifies issues raised in GA-0600 regarding the eligibility of property owned by a lessee for abatement. Grants county commissioners courts the authority to grant abatements for tangible personal property and clarifies existing law regarding the duration of an abatement granted under the Property Redevelopment and Tax Abatement Act. (Chapter 312, Tax Code, SB 1458, Effective: 6/19/09)




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