bill ending property taxes on tangible personal property

The text as introduced · 13,084 words

89R13329 RDS-D

By: Money
H.B. No. 4360

A BILL TO BE ENTITLED

AN ACT

relating to the exemption of tangible personal property from ad

valorem taxation; making conforming changes.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 6.24(b), Tax Code, is amended to read as

follows:

(b) The commissioners court with the approval of the county

assessor-collector may contract as provided by the Interlocal

Cooperation Act with the governing body of another taxing unit in

the county or with the board of directors of the appraisal district

for the other taxing unit or the district to perform duties relating

to the assessment or collection of taxes for the county. If a

county contracts to have its taxes assessed and collected by

another taxing unit or by the appraisal district, [ except as

provided by Subsection (c), ] the contract shall require the other

taxing unit or the district to assess and collect all taxes the

county is required to assess and collect.

SECTION 2. The heading to Section 11.01, Tax Code, is

amended to read as follows:

Sec. 11.01. REAL [ AND TANGIBLE PERSONAL ] PROPERTY.

SECTION 3. Section 11.01(a), Tax Code, is amended to read as

follows:

(a) All real [ and tangible personal ] property that this

state has jurisdiction to tax is taxable unless exempt by law.

SECTION 4. Subchapter A, Chapter 11, Tax Code, is amended by

adding Section 11.015 to read as follows:

Sec. 11.015. TANGIBLE PERSONAL PROPERTY. (a) Tangible

personal property is not taxable for a tax year that begins on or

after January 1, 2026.

(b) On and after January 1, 2026, a provision of this code or

another law that would otherwise apply to the taxation of tangible

personal property for a tax year that begins on or after that date

has no effect for that tax year.

SECTION 5. Section 11.18(a), Tax Code, is amended to read as

follows:

(a) An organization that qualifies as a charitable

organization as provided by this section is entitled to an

exemption from taxation of:

(1) the buildings [ and tangible personal property ]

that:

(A) are owned by the charitable organization; and

(B) except as permitted by Subsection (b), are

used exclusively by qualified charitable organizations;

(2) the real property owned by the charitable

organization consisting of:

(A) an incomplete improvement that:

(i) is under active construction or other

physical preparation; and

(ii) is designed and intended to be used

exclusively by qualified charitable organizations; and

(B) the land on which the incomplete improvement

is located that will be reasonably necessary for the use of the

improvement by qualified charitable organizations; and

(3) if the charitable organization is described by

Subsection (d)(1), (2), (3)(A)(ii), (5), (8), (13), (15), or (19),

the real property owned by the charitable organization consisting

of an interest in a mineral in place, including a royalty interest,

provided that the interest:

(A) is not severed from the surface estate; or

(B) was donated to the charitable organization by

the previous owner of the interest.

SECTION 6. Section 11.181(c), Tax Code, is amended to read

as follows:

(c) An organization entitled to an exemption under

Subsection (a) is also entitled to an exemption from taxation of any

building [ or tangible personal property ] the organization owns and

uses in the administration of its acquisition, building, repair, or

sale of property. To qualify for an exemption under this

subsection, property must be used exclusively by the charitable

organization, except that another individual or organization may

use the property for activities incidental to the charitable

organization's use that benefit the beneficiaries of the charitable

organization.

SECTION 7. Section 11.182(f), Tax Code, is amended to read

as follows:

(f) An organization entitled to an exemption under

Subsection (b) is also entitled to an exemption from taxation of any

building [ or tangible personal property ] the organization owns and

uses in the administration of its acquisition, building, repair,

sale, or rental of property. To qualify for an exemption under this

subsection, property must be used exclusively by the organization,

except that another person may use the property for activities

incidental to the organization's use that benefit the beneficiaries

of the organization.

SECTION 8. Section 11.1827(d), Tax Code, is amended to read

as follows:

(d) A community land trust entitled to an exemption from

taxation by a taxing unit under Subsection (b) is also entitled to

an exemption from taxation by the taxing unit of any real [ or

tangible personal ] property the trust owns and uses in the

administration of its acquisition, construction, repair, sale, or

leasing of property. To qualify for an exemption under this

subsection, property must be used exclusively by the trust, except

that another person may use the property for activities incidental

to the trust's use that benefit the beneficiaries of the trust.

SECTION 9. Section 11.184(c), Tax Code, is amended to read

as follows:

(c) A qualified charitable organization is entitled to an

exemption from taxation of:

(1) the buildings and other real property [ and the

tangible personal property ] that:

(A) are owned by the organization; and

(B) except as permitted by Subsection (d), are

used exclusively by the organization and other organizations

eligible for an exemption from taxation under this section or

Section 11.18; and

(2) the real property owned by the organization

consisting of:

(A) an incomplete improvement that:

(i) is under active construction or other

physical preparation; and

(ii) is designed and intended to be used

exclusively by the organization and other organizations eligible

for an exemption from taxation under this section or Section 11.18;

and

(B) the land on which the incomplete improvement

is located that will be reasonably necessary for the use of the

improvement by the organization and other organizations eligible

for an exemption from taxation under this section or Section 11.18.

SECTION 10. Section 11.185(c), Tax Code, is amended to read

as follows:

(c) An organization entitled to an exemption under

Subsection (a) is also entitled to an exemption from taxation of any

building [ or tangible personal property ] the organization owns and

uses in the administration of its acquisition, building, repair, or

sale of property. To qualify for an exemption under this

subsection, property must be used exclusively by the charitable

organization, except that another individual or organization may

use the property for activities incidental to the charitable

organization's use that benefit the beneficiaries of the charitable

organization.

SECTION 11. Sections 11.20(a), (d), (f), (g), (h), (j), and

(k), Tax Code, are amended to read as follows:

(a) An organization that qualifies as a religious

organization as provided by Subsection (c) is entitled to an

exemption from taxation of:

(1) the real property that is owned by the religious

organization, is used primarily as a place of regular religious

worship, and is reasonably necessary for engaging in religious

worship;

(2) [ the tangible personal property that is owned by

the religious organization and is reasonably necessary for engaging

in worship at the place of worship specified in Subdivision (1);

[ (3) ] the real property that is owned by the religious

organization and is reasonably necessary for use as a residence

(but not more than one acre of land for each residence) if the

property:

(A) is used exclusively as a residence for those

individuals whose principal occupation is to serve in the clergy of

the religious organization; and

(B) produces no revenue for the religious

organization;

(3) [ (4) the tangible personal property that is owned

by the religious organization and is reasonably necessary for use

of the residence specified by Subdivision (3);

[ (5) ] the real property owned by the religious

organization consisting of:

(A) an incomplete improvement that is under

active construction or other physical preparation and that is

designed and intended to be used by the religious organization as a

place of regular religious worship when complete; and

(B) the land on which the incomplete improvement

is located that will be reasonably necessary for the religious

organization's use of the improvement as a place of regular

religious worship;

(4) [ (6) ] the land that the religious organization

owns for the purpose of expansion of the religious organization's

place of regular religious worship or construction of a new place of

regular religious worship if:

(A) the religious organization qualifies other

property, including a portion of the same tract or parcel of land,

owned by the organization for an exemption under Subdivision (1) or

(3) [ (5) ]; and

(B) the land produces no revenue for the

religious organization; and

(5) [ (7) ] the real property owned by the religious

organization that is leased to another person and used by that

person for the operation of a school that qualifies as a school

under Section 11.21(d).

(d) Use of property that qualifies for the exemption

prescribed by Subsection (a)(1) or [ (2) or by Subsection ] (h)(1)

for occasional secular purposes other than religious worship does

not result in loss of the exemption if the primary use of the

property is for religious worship and all income from the other use

is devoted exclusively to the maintenance and development of the

property as a place of religious worship.

(f) A property may not be exempted under Subsection (a)(3)

[ (a)(5) ] for more than three years.

(g) For purposes of Subsection (a)(3) [ (a)(5) ], an

incomplete improvement is under physical preparation if the

religious organization has engaged in architectural or engineering

work, soil testing, land clearing activities, or site improvement

work necessary for the construction of the improvement or has

conducted an environmental or land use study relating to the

construction of the improvement.

(h) Property owned by this state or a political subdivision

of this state, including a leasehold or other possessory interest

in the property, that is held or occupied by an organization that

qualifies as a religious organization as provided by Subsection (c)

is entitled to an exemption from taxation if the property:

(1) is used by the organization primarily as a place of

regular religious worship and is reasonably necessary for engaging

in religious worship; or

(2) meets the qualifications for an exemption under

Subsection (a)(3) [ (a)(5) ].

(j) A tract of land that is contiguous to the tract of land

on which the religious organization's place of regular religious

worship is located may not be exempted under Subsection (a)(4)

[ (a)(6) ] for more than 10 years. A tract of land that is not

contiguous to the tract of land on which the religious

organization's place of regular religious worship is located may

not be exempted under Subsection (a)(4) [ (a)(6) ] for more than

three years. For purposes of this subsection, a tract of land is

considered to be contiguous with another tract of land if the tracts

are divided only by a road, railroad track, river, or stream.

(k) For purposes of Subsection (a)(4) [ (a)(6) ], an

application or statement accompanying an application for the

exemption stating that the land is owned for the purposes described

by Subsection (a)(4) [ (a)(6) ] and signed by an authorized officer

of the organization is sufficient to establish that the land is

owned for those purposes.

SECTION 12. Sections 11.201(a) and (c), Tax Code, are

amended to read as follows:

(a) If land is sold or otherwise transferred to another

person in a year in which the land receives an exemption under

Section 11.20(a)(4) [ 11.20(a)(6) ], an additional tax is imposed on

the land equal to the tax that would have been imposed on the land

had the land been taxed for each of the five years preceding the

year in which the sale or transfer occurs in which the land received

an exemption under that subsection, plus interest at an annual rate

of seven percent calculated from the dates on which the taxes would

have become due.

(c) If only part of a parcel of land that is exempted under

Section 11.20(a)(4) [ 11.20(a)(6) ] is sold or transferred, the tax

applies only to that part of the parcel and equals the taxes that

would have been imposed had that part been taxed.

SECTION 13. Sections 11.21(a), (b), and (f), Tax Code, are

amended to read as follows:

(a) A person is entitled to an exemption from taxation of:

(1) the buildings [ and tangible personal property ]

that the person owns and that are used for a school that is

qualified as provided by Subsection (d) if:

(A) the school is operated exclusively by the

person owning the property;

(B) except as permitted by Subsection (b), the

buildings [ and tangible personal property ] are used exclusively for

educational functions; and

(C) the buildings [ and tangible personal

property ] are reasonably necessary for the operation of the school;

and

(2) the real property owned by the person consisting

of:

(A) an incomplete improvement that:

(i) is under active construction or other

physical preparation; and

(ii) is designed and intended to be used for

a school that is qualified as provided by Subsection (d); and

(B) the land on which the incomplete improvement

is located that will be reasonably necessary for the use of the

improvement for a school that is qualified as provided by

Subsection (d).

(b) Use of exempt [ tangible ] property for functions other

than educational functions does not result in loss of an exemption

authorized by this section if those other functions are incidental

to use of the property for educational functions and benefit the

students or faculty of the school.

(f) Notwithstanding Subsection (a), a person is entitled to

an exemption from taxation of the buildings [ and tangible personal

property ] the person acquires for use for a school that meets each

requirement of Subsection (d) if:

(1) the person authorizes the former owner to continue

to use the property pending the use of the property for a school;

and

(2) the former owner would be entitled to an exemption

from taxation of the property if the former owner continued to own

the property.

SECTION 14. Section 11.23(m), Tax Code, is amended to read

as follows:

(m) National Hispanic Institute. The National Hispanic

Institute is entitled to an exemption from taxation of the real [ and

tangible personal ] property it owns as long as the organization is

exempt from federal income taxation under Section 501(a), Internal

Revenue Code of 1986, as an organization described by Section

501(c)(3) of that code.

SECTION 15. Section 11.231(b), Tax Code, is amended to read

as follows:

(b) An association that qualifies as a nonprofit community

business organization as provided by this section is entitled to an

exemption from taxation of:

(1) the buildings [ and tangible personal property ]

that:

(A) are owned by the nonprofit community business

organization; and

(B) except as permitted by Subsection (c), are

used exclusively by qualified nonprofit community business

organizations to perform their primary functions; and

(2) the real property owned by the nonprofit community

business organization consisting of:

(A) an incomplete improvement that:

(i) is under active construction or other

physical preparation; and

(ii) is designed and intended to be used

exclusively by qualified nonprofit community business

organizations; and

(B) the land on which the incomplete improvement

is located that will be reasonably necessary for the use of the

improvement by qualified nonprofit community business

organizations.

SECTION 16. Section 11.35(a)(2), Tax Code, is amended to

read as follows:

(2) "Qualified property" means property that:

(A) consists of:

(i) [ tangible personal property used for

the production of income;

[ (ii) ] an improvement to real property; or

(ii) [ (iii) ] a manufactured home as that

term is defined by Section 1201.003, Occupations Code, that is used

as a dwelling, regardless of whether the owner of the manufactured

home elects to treat the manufactured home as real property under

Section 1201.2055, Occupations Code;

(B) is located in an area declared by the

governor to be a disaster area following a disaster; and

(C) is at least 15 percent damaged by the

disaster, as determined by the chief appraiser under this section[ ;

and

[ (D) for property described by Paragraph (A)(i),

is the subject of a rendition statement or property report filed by

the property owner under Section 22.01 that demonstrates that the

property had taxable situs in the disaster area for the tax year in

which the disaster occurred ].

SECTION 17. Section 11.35(g), Tax Code, is amended to read

as follows:

(g) The chief appraiser shall assign to an item of qualified

property:

(1) a Level I damage assessment rating if the property

is at least 15 percent, but less than 30 percent, damaged, meaning

that the property suffered minimal damage and may continue to be

used as intended;

(2) a Level II damage assessment rating if the

property is at least 30 percent, but less than 60 percent, damaged,

meaning [ which, for qualified property described by Subsection

(a)(2)(A)(ii) or (iii), means ] that the property has suffered only

nonstructural damage, including nonstructural damage to the roof,

walls, foundation, or mechanical components, and the waterline, if

any, is less than 18 inches above the floor;

(3) a Level III damage assessment rating if the

property is at least 60 percent damaged but is not a total loss,

meaning [ which, for qualified property described by Subsection

(a)(2)(A)(ii) or (iii), means ] that the property has suffered

significant structural damage requiring extensive repair due to the

failure or partial failure of structural elements, wall elements,

or the foundation, or the waterline is at least 18 inches above the

floor; or

(4) a Level IV damage assessment rating if the

property is a total loss, meaning that repair of the property is not

feasible.

SECTION 18. Sections 11.42(b) and (d), Tax Code, are

amended to read as follows:

(b) An exemption authorized by Section 11.11 [ or 11.141 ] is

effective immediately on qualification for the exemption.

(d) A person who acquires property after January 1 of a tax

year may receive an exemption authorized by Section 11.17, 11.18,

11.19, 11.20, 11.21, 11.23, 11.231, or 11.30[ , or 11.36 ] for the

applicable portion of that tax year immediately on qualification

for the exemption.

SECTION 19. Sections 11.43(a), (b), (c), and (e), Tax Code,

are amended to read as follows:

(a) To receive an exemption, a person claiming the

exemption, other than an exemption authorized by Section 11.11,

11.12, or [ 11.14, 11.141, 11.145, ] 11.146[ , 11.15, 11.16, 11.161,

or 11.25 ], must apply for the exemption. To apply for an exemption,

a person must file an exemption application form with the chief

appraiser for each appraisal district in which the property subject

to the claimed exemption has situs.

(b) Except as provided by Subsection (c) and by Section

[ Sections ] 11.184 [ and 11.437 ], a person required to apply for an

exemption must apply each year the person claims entitlement to the

exemption.

(c) An exemption provided by Section 11.13, 11.131, 11.132,

11.133, 11.134, 11.17, 11.18, 11.182, 11.1827, 11.183, 11.19,

11.20, 11.21, 11.22, 11.23(a), (h), (j), (j-1), or (m), 11.231,

[ 11.254, ] 11.27, [ 11.271, ] 11.29, 11.30, 11.31, [ 11.315, ] 11.35, or

11.37 [ 11.36 ], once allowed, need not be claimed in subsequent

years, and except as otherwise provided by Subsection (e), the

exemption applies to the property until it changes ownership or the

person's qualification for the exemption changes. However, except

as provided by Subsection (r), the chief appraiser may require a

person allowed one of the exemptions in a prior year to file a new

application to confirm the person's current qualification for the

exemption by delivering a written notice that a new application is

required, accompanied by an appropriate application form, to the

person previously allowed the exemption. If the person previously

allowed the exemption is 65 years of age or older, the chief

appraiser may not cancel the exemption due to the person's failure

to file the new application unless the chief appraiser complies

with the requirements of Subsection (q), if applicable.

(e) Except as provided by Section 11.422, 11.431, 11.433,

11.434, 11.435, or 11.439, [ or 11.4391, ] if a person required to

apply for an exemption in a given year fails to file timely a

completed application form, the person may not receive the

exemption for that year.

SECTION 20. Section 21.06(a), Tax Code, is amended to read

as follows:

(a) Except as provided by Section 21.08 [ Sections 21.07

through 21.09 of this code ], intangible property is taxable by a

taxing unit if the owner of the property resides in the taxing unit

on January 1, unless the property normally is used in this state for

business purposes outside the taxing unit. In that event, the

intangible property is taxable by each taxing unit in which the

property normally is used for business purposes.

SECTION 21. Sections 22.01(a), (b), (c), (c-2), (f), and

(g), Tax Code, are amended to read as follows:

(a) [ Except as provided by Chapter 24, a person shall render

for taxation all tangible personal property used for the production

of income that the person owns or that the person manages and

controls as a fiduciary on January 1. ] A rendition statement shall

contain:

(1) the name and address of the property owner;

(2) a description of the property by type or category;

(3) [ if the property is inventory, a description of

each type of inventory and a general estimate of the quantity of

each type of inventory;

[ (4) ] the physical location or taxable situs of the

property; and

(4) [ (5) ] the property owner's good faith estimate of

the market value of the property or, at the option of the property

owner, the historical cost when new and the year of acquisition of

the property.

(b) When required by the chief appraiser, a person shall

render for taxation any [ other ] taxable property that the person

[ he ] owns or that the person [ he ] manages and controls as a

fiduciary on January 1.

(c) A person may render for taxation any property that the

person [ he ] owns or that the person [ he ] manages and controls as a

fiduciary on January 1, although the person [ he ] is not required to

render it by Subsection [ (a) or ] (b) [ of this section ].

(c-2) With the consent of the property owner, a secured

party may render for taxation any property of the property owner in

which the secured party has a security interest on January 1,

although the secured party is not required to render the property by

Subsection [ (a) or ] (b). This subsection applies only to property

that has a historical cost when new of more than $50,000.

(f) Notwithstanding Subsection [ Subsections ] (a) [ and (b) ],

a rendition statement of a person who owns [ tangible personal ]

property [ used for the production of income ] located in the

appraisal district that, in the owner's opinion, has an aggregate

value of less than $20,000 is required to contain only:

(1) the name and address of the property owner;

(2) a general description of the property by type or

category; and

(3) the physical location or taxable situs of the

property.

(g) A person's good faith estimate of the market value of

the property under Subsection (a)(4) [ (a)(5) ] is solely for the

purpose of compliance with any [ the ] requirement to render

[ tangible personal ] property and is inadmissible in any subsequent

protest, hearing, appeal, suit, or other proceeding under this

title involving the property, except for:

(1) a proceeding to determine whether the person

complied with this section;

(2) a proceeding under Section 22.29(b); or

(3) a protest under Section 41.41.

SECTION 22. Section 22.02, Tax Code, is amended to read as

follows:

Sec. 22.02. RENDITION OF PROPERTY LOSING EXEMPTION DURING

TAX YEAR [ OR FOR WHICH EXEMPTION APPLICATION IS DENIED ]. [ (a) ] If

an exemption applicable to a property on January 1 terminates

during the tax year, the person who owns or acquires the property on

the date applicability of the exemption terminates shall render the

property for taxation within 30 days after the date of termination.

[ (b) If the chief appraiser denies an application for an

exemption for property described by Section 22.01(a), the person

who owns the property on the date the application is denied shall

render the property for taxation in the manner provided by Section

22.01 within 30 days after the date of denial. ]

SECTION 23. Section 22.05, Tax Code, is amended to read as

follows:

Sec. 22.05. RENDITION BY RAILROAD. (a) A [ In addition to

other reports required by Chapter 24 of this code, a ] railroad

corporation shall render the real property the railroad corporation

owns or possesses as of January 1.

(b) The rendition shall:

(1) list all real property other than the property

covered by Subdivision (2) [ of this subsection ]; and

(2) list the number of miles of railroad together with

the market value per mile, which value shall include right-of-way,

roadbed, superstructure, and all buildings and improvements used in

the operation of the railroad[ ; and

[ (3) list all personal property as required by Section

22.01 of this code ].

SECTION 24. The heading to Section 22.07, Tax Code, is

amended to read as follows:

Sec. 22.07. STATEMENT INDICATING HOW VALUE RENDERED

[ INSPECTION OF PROPERTY ].

SECTION 25. Section 22.07, Tax Code, is amended by amending

Subsection (c) and adding Subsection (c-1) to read as follows:

(c) The chief appraiser may request, either in writing or by

electronic means, that the property owner provide a statement

containing supporting information indicating how the value

rendered under Section 22.01(a)(4) [ 22.01(a)(5) ] was determined.

The statement must:

(1) summarize information sufficient to identify the

property, including:

(A) the physical and economic characteristics

relevant to the opinion of value, if appropriate; and

(B) the source of the information used;

(2) state the effective date of the opinion of value;

and

(3) explain the basis of the value rendered.

(c-1) If the property owner is a business with 50 employees

or less, the property owner may base the estimate of value on the

depreciation schedules used for federal income tax purposes.

SECTION 26. Section 22.24(e), Tax Code, is amended to read

as follows:

(e) To be valid, a rendition or report must be sworn to

before an officer authorized by law to administer an oath. The

comptroller may not prescribe or approve a rendition or report form

unless the form provides for the person filing the form to swear

that the information provided in the rendition or report is true and

accurate to the best of the person's knowledge and belief. This

subsection does not apply to a rendition or report filed:

(1) by a secured party, as defined by Section 22.01;

(2) by the property owner;

(3) by an employee of the property owner; or

(4) by an employee of a property owner on behalf of an

affiliated entity of the property owner[ ; or

[ (5) on behalf of a property owner who is rendering

tangible personal property used for the production of income and

whose good faith estimate of the market value of that property is

not more than $150,000 ].

SECTION 27. Section 23.014, Tax Code, is amended to read as

follows:

Sec. 23.014. EXCLUSION OF PROPERTY AS REAL PROPERTY. In

[ Except as provided by Section 23.24(b), in ] determining the market

value of real property, the chief appraiser shall analyze the

effect on that value of, and exclude from that value the value of,

any:

(1) tangible personal property, including trade

fixtures;

(2) intangible personal property;

(3) chicken coops or rabbit pens used for the

noncommercial production of food for personal consumption; or

(4) other property that is not subject to appraisal as

real property.

SECTION 28. Sections 23.12(a) and (f), Tax Code, are

amended to read as follows:

(a) The [ Except as provided by Sections 23.121, 23.1241,

23.124, and 23.127, the ] market value of a real property [ an ]

inventory is the price for which it would sell as a unit to a

purchaser who would continue the business. A real property [ An ]

inventory includes [ shall include ] residential real property which

has never been occupied as a residence and is held for sale in the

ordinary course of a trade or business, provided that the

residential real property remains unoccupied, is not leased or

rented, and produces no income.

(f) The owner of an inventory [ other than a dealer's motor

vehicle inventory as that term is defined by Section 23.121, a

dealer's heavy equipment inventory as that term is defined by

Section 23.1241, or a dealer's vessel and outboard motor inventory

as that term is defined by Section 23.124, or a retail manufactured

housing inventory as that term is defined by Section 23.127 ] may

elect to have the inventory appraised at its market value as of

September 1 of the year preceding the tax year to which the

appraisal applies by filing an application with the chief appraiser

requesting that the inventory be appraised as of September 1. The

application must clearly describe the inventory to which it applies

and be signed by the owner of the inventory. The application

applies to the appraisal of the inventory in each tax year that

begins after the next August 1 following the date the application is

filed with the chief appraiser unless the owner of the inventory by

written notice filed with the chief appraiser revokes the

application or the ownership of the inventory changes. A notice

revoking the application is effective for each tax year that begins

after the next September following the date the notice of

revocation is filed with the chief appraiser.

SECTION 29. Sections 25.25(e) and (m), Tax Code, are

amended to read as follows:

(e) If the chief appraiser and the property owner do not

agree to the correction before the 15th day after the date the

motion is filed, a party bringing a motion under Subsection (c)[ ,

(c-1), ] or (d) is entitled on request to a hearing on and a

determination of the motion by the appraisal review board. A party

bringing a motion under this section must describe the error or

errors that the motion is seeking to correct. If a request for

hearing is made on or after January 1 but before September 1, the

appraisal review board shall schedule the hearing to be held as soon

as practicable but not later than the 90th day after the date the

board approves the appraisal records as provided by Section 41.12.

If a request for hearing is made on or after September 1 but before

January 1 of the following tax year, the appraisal review board

shall schedule the hearing to be held as soon as practicable but not

later than the 90th day after the date the request for the hearing

is made. Not later than 15 days before the date of the hearing, the

board shall deliver written notice of the date, time, and place of

the hearing to the chief appraiser, the property owner, and the

presiding officer of the governing body of each taxing unit in which

the property is located. The chief appraiser, the property owner,

and each taxing unit are entitled to present evidence and argument

at the hearing and to receive written notice of the board's

determination of the motion. The property owner is entitled to

elect to present the owner's evidence and argument before, after,

or between the cases presented by the chief appraiser and each

taxing unit. A property owner who files the motion must comply with

the payment requirements of Section 25.26 or forfeit the right to a

final determination of the motion.

(m) The hearing on a motion under Subsection (c)[ , (c-1), ]

or (d) shall be conducted in the manner provided by Subchapter C,

Chapter 41.

SECTION 30. Section 26.012, Tax Code, is amended by

amending Subdivisions (6), (15), and (18) and adding Subdivision

(13-a) to read as follows:

(6) "Current total value" means the total taxable

value of property listed on the appraisal roll for the current year,

including all appraisal roll supplements and corrections as of the

date of the calculation, less the taxable value of property

exempted for the current tax year for the first time under Section

11.31 [ or 11.315 ], except that:

(A) the current total value for a school district

excludes:

(i) the total value of homesteads that

qualify for a tax limitation as provided by Section 11.26;

(ii) new property value of property that is

subject to an agreement entered into under former Subchapter B or C,

Chapter 313; and

(iii) new property value of property that

is subject to an agreement entered into under Subchapter T, Chapter

403, Government Code; and

(B) the current total value for a county,

municipality, or junior college district excludes the total value

of homesteads that qualify for a tax limitation provided by Section

11.261.

(13-a) "Last year's tangible personal property levy"

means the amount of taxes levied in the preceding year on property

value that was taxable in the preceding year but is not taxable in

the current year because the property is exempt in the current year

under Section 11.015. This subdivision expires January 1, 2027.

(15) "Lost property levy" means the amount of taxes

levied in the preceding year on property value that was taxable in

the preceding year but is not taxable in the current year because

the property is exempt in the current year under a provision of this

code other than Section [ 11.251, 11.253, or ] 11.35, the property

has qualified for special appraisal under Chapter 23 in the current

year, or the property is located in territory that has ceased to be

a part of the taxing unit since the preceding year.

(18) "No-new-revenue maintenance and operations rate"

means a rate expressed in dollars per $100 of taxable value

calculated as follows:

(A) for a taxing unit other than a school

district, the rate calculated according to the following formula:

NO-NEW-REVENUE MAINTENANCE AND OPERATIONS RATE = (LAST

YEAR'S LEVY - LAST YEAR'S DEBT LEVY - LAST YEAR'S JUNIOR COLLEGE LEVY

- LAST YEAR'S TANGIBLE PERSONAL PROPERTY LEVY ) / (CURRENT TOTAL

VALUE - NEW PROPERTY VALUE)

; or

(B) for a school district, the rate calculated as

provided by Section 44.004(c)(5)(A)(ii)(a), Education Code.

SECTION 31. Effective January 1, 2027, Section 26.012(18),

Tax Code, is amended to read as follows:

(18) "No-new-revenue maintenance and operations rate"

means a rate expressed in dollars per $100 of taxable value

calculated as follows:

(A) for a taxing unit other than a school

district, the rate calculated according to the following formula:

NO-NEW-REVENUE MAINTENANCE AND OPERATIONS RATE = (LAST

YEAR'S LEVY - LAST YEAR'S DEBT LEVY - LAST YEAR'S JUNIOR COLLEGE

LEVY) / (CURRENT TOTAL VALUE - NEW PROPERTY VALUE)

; or

(B) for a school district, the rate calculated as

provided by Section 44.004(c)(5)(A)(ii)(a), Education Code.

SECTION 32. Section 26.09(b), Tax Code, is amended to read

as follows:

(b) [ The county assessor-collector shall add the properties

and their values certified to him as provided by Chapter 24 of this

code to the appraisal roll for county tax purposes. ] The county

assessor-collector shall use the appraisal roll certified to the

county assessor-collector [ him ] as provided by Section 26.01 [ with

the added properties and values ] to calculate county taxes.

SECTION 33. Section 31.032(a), Tax Code, is amended to read

as follows:

(a) This section applies only to:

(1) real property that:

(A) is:

(i) the residence homestead of the owner or

consists of property that is used for residential purposes and that

has fewer than five living units; or

(ii) owned or leased by a business entity

that had not more than the amount calculated as provided by

Subsection (h) in gross receipts in the entity's most recent

federal tax year or state franchise tax annual period, according to

the applicable federal income tax return or state franchise tax

report of the entity;

(B) is located in a disaster area or emergency

area; and

(C) has been damaged as a direct result of the

disaster or emergency; and

(2) [ tangible personal property that is owned or

leased by a business entity described by Subdivision (1)(A)(ii);

and

[ (3) ] taxes that are imposed on the property by a

taxing unit before the first anniversary of the disaster or

emergency.

SECTION 34. Section 31.033(b), Tax Code, is amended to read

as follows:

(b) This section applies only to:

(1) real property that:

(A) is owned or leased by a business entity that

had not more than the amount calculated as provided by Section

31.032(h) in gross receipts in the entity's most recent federal tax

year or state franchise tax annual period, according to the

applicable federal income tax return or state franchise tax report

of the entity;

(B) is located in a disaster area or emergency

area; and

(C) has not been damaged as a direct result of the

disaster or emergency; and

(2) [ tangible personal property that is owned or

leased by a business entity described by Subdivision (1)(A); and

[ (3) ] taxes that are imposed on the property by a

taxing unit before the first anniversary of the disaster or

emergency.

SECTION 35. Section 41.44(a), Tax Code, is amended to read

as follows:

(a) Except as provided by Subsections (b), (c), (c-1), and

(c-2), to be entitled to a hearing and determination of a protest,

the property owner initiating the protest must file a written

notice of the protest with the appraisal review board having

authority to hear the matter protested:

(1) not later than May 15 or the 30th day after the

date that notice to the property owner was delivered to the property

owner as provided by Section 25.19, whichever is later;

(2) in the case of a protest of a change in the

appraisal records ordered as provided by Subchapter A of this

chapter or by Chapter 25, not later than the 30th day after the date

notice of the change is delivered to the property owner;

(3) in the case of a determination that a change in the

use of land appraised under Subchapter C, D, E, or H, Chapter 23,

has occurred, not later than the 30th day after the date the notice

of the determination is delivered to the property owner; or

(4) [ in the case of a determination of eligibility for

a refund under Section 23.1243, not later than the 30th day after

the date the notice of the determination is delivered to the

property owner; or

[ (5) ] in the case of a protest of the modification or

denial of an application for an exemption under Section 11.35, or

the determination of an appropriate damage assessment rating for an

item of qualified property under that section, not later than the

30th day after the date the property owner receives the notice

required under Section 11.45(e).

SECTION 36. Section 42.01, Tax Code, is amended to read as

follows:

Sec. 42.01. RIGHT OF APPEAL BY PROPERTY OWNER. (a) A

property owner is entitled to appeal[ :

[ (1) ] an order of the appraisal review board

determining:

(1) [ (A) ] a protest by the property owner as provided

by Subchapter C of Chapter 41;

(2) [ (B) ] a motion filed under Section 25.25;

(3) [ (C) ] that the property owner has forfeited the

right to a final determination of a motion filed under Section 25.25

or of a protest under Section 41.411 for failing to comply with the

prepayment requirements of Section 25.26 or 41.4115, as applicable;

or

(4) [ (D) eligibility for a refund requested under

Section 23.1243; or

[ (E) ] that the appraisal review board lacks

jurisdiction to finally determine a protest by the property owner

under Subchapter C, Chapter 41, or a motion filed by the property

owner under Section 25.25 because the property owner failed to

comply with a requirement of Subchapter C, Chapter 41, or Section

25.25, as applicable[ ; or

[ (2) an order of the comptroller issued as provided by

Subchapter B, Chapter 24, apportioning among the counties the

appraised value of railroad rolling stock owned by the property

owner ].

(b) A property owner who establishes that the owner did not

forfeit the right to a final determination of a motion or of a

protest in an appeal under Subsection (a)(3) [ (a)(1)(C) ] is

entitled to a final determination of the court, as applicable:

(1) of the motion filed under Section 25.25; or

(2) of the protest under Section 41.411 of the failure

of the chief appraiser or appraisal review board to provide or

deliver a notice to which the property owner is entitled, and, if

failure to provide or deliver the notice is established, of a

protest made by the property owner on any other grounds of protest

authorized by this title relating to the property to which the

notice applies.

(c) A property owner who establishes that the appraisal

review board had jurisdiction to issue a final determination of the

protest by the property owner under Subchapter C, Chapter 41, or of

the motion filed by the property owner under Section 25.25 in an

appeal under Subsection (a)(4) [ (a)(1)(E) ] of this section is

entitled to a final determination by the court of the protest under

Subchapter C, Chapter 41, or of the motion filed under Section

25.25. A final determination of a protest under Subchapter C,

Chapter 41, by the court under this subsection may be on any ground

of protest authorized by this title applicable to the property that

is the subject of the protest, regardless of whether the property

owner included the ground in the property owner's notice of

protest.

SECTION 37. Section 42.21(b), Tax Code, is amended to read

as follows:

(b) A petition for review brought under Section 42.02 must

be brought against the owner of the property involved in the appeal.

A petition for review brought under Section 42.031 must be brought

against the appraisal district and against the owner of the

property involved in the appeal. [ A petition for review brought

under Section 42.01(a)(2) or 42.03 must be brought against the

comptroller. ] Any other petition for review under this chapter

must be brought against the appraisal district. A petition for

review may not be brought against the appraisal review board. An

appraisal district may hire an attorney that represents the

district to represent the appraisal review board established for

the district to file an answer and obtain a dismissal of a suit

filed against the appraisal review board in violation of this

subsection.

SECTION 38. Section 42.22, Tax Code, as amended by Chapters

667 (S.B. 548) and 1033 (H.B. 301), Acts of the 73rd Legislature,

Regular Session, 1993, is reenacted and amended to read as follows:

Sec. 42.22. VENUE. (a) Except as provided by Subsection

[ Subsections ] (b) of this section [ and (c), ] and by Section 42.221,

venue is in the county in which the appraisal review board that

issued the order appealed is located.

(b) Venue of an action brought under Section 42.01(a)

[ 42.01(1) ] is in the county in which the property is located or in

the county in which the appraisal review board that issued the order

is located.

[ (c) Venue is in Travis County if the order appealed was

issued by the comptroller. ]

SECTION 39. Sections 151.356(a) and (c), Tax Code, are

amended to read as follows:

(a) In this section :

(1) "Environmental protection agency of the United

States" includes:

(A) the United States Department of the Interior

and any agency, bureau, or other entity established in that

department, including the Bureau of Safety and Environmental

Enforcement and the Bureau of Ocean Energy Management; and

(B) any other department, agency, bureau, or

entity of the United States that prescribes rules or regulations

described by Subdivision (3)(A).

(2) "Offshore [ , "offshore ] spill response containment

property" means tangible personal property:

(A) used, constructed, acquired, stored, or

installed solely as part of, or used solely for the development,

improvement, storage, deployment, repair, maintenance, or testing

of, an offshore spill response containment system that is stored

while not in use in a county bordering on the Gulf of Mexico or on a

bay or other body of water immediately adjacent to the Gulf of

Mexico [ (1) described by Section 11.271(c) ];

(B) [ (2) ] owned or leased by an entity formed

primarily for the purpose of designing, developing, modifying,

enhancing, assembling, operating, deploying, and maintaining an

offshore spill response containment system [ described by Section

11.271(f) ]; and

(C) [ (3) ] used or intended to be used solely in

an offshore spill response containment system [ as defined by

Section 11.271(a) ].

(3) "Offshore spill response containment system"

means a marine or mobile containment system that:

(A) is designed and used or intended to be used

solely to implement a response plan that meets or exceeds rules or

regulations adopted by any environmental protection agency of the

United States, this state, or a political subdivision of this state

for the control, reduction, or monitoring of air, water, or land

pollution in the event of a blowout or loss of control of an

offshore well drilled or used for the exploration for or production

of oil or gas;

(B) has a design capability to respond to a

blowout or loss of control of an offshore well drilled or used for

the exploration for or production of oil or gas that is drilled in

more than 5,000 feet of water;

(C) is used or intended to be used solely to

respond to a blowout or loss of control of an offshore well drilled

or used for the exploration for or production of oil or gas without

regard to the depth of the water in which the well is drilled; and

(D) except for any monitoring function for which

the system may be used, is used or intended to be used as a temporary

measure to address fugitive oil, gas, sulfur, or other minerals

after a leak has occurred and is not used or intended to be used

after the leak has been contained as a continuing means of producing

oil, gas, sulfur, or other minerals.

(4) "Rules or regulations adopted by any environmental

protection agency of the United States" includes 30 C.F.R. Part 254

and any corresponding provision or provisions of succeeding,

similar, substitute, proposed, or final federal regulations.

(c) The sale, lease, rental, storage, use, or other

consumption by an entity described by Subsection (a)(2)(B) [ Section

11.271(f) ] of offshore spill response containment property used

solely for the purposes described by [ Section 11.271(c) and ] this

section is exempted from the taxes imposed by this chapter.

SECTION 40. Section 312.0021(b), Tax Code, is amended to

read as follows:

(b) Notwithstanding any other provision of this chapter, an

owner or lessee of a parcel of real property that is located wholly

or partly in a reinvestment zone may not receive an exemption from

taxation of any portion of the value of the parcel of real property

[ or of tangible personal property located on the parcel of real

property ] under a tax abatement agreement under this chapter that

is entered into on or after September 1, 2017, if, on or after that

date, a wind-powered energy device is installed or constructed on

the same parcel of real property at a location that is within 25

nautical miles of the boundaries of a military aviation facility

located in this state. The prohibition provided by this section

applies regardless of whether the wind-powered energy device is

installed or constructed at a location that is in the reinvestment

zone.

SECTION 41. Section 312.007(a), Tax Code, is amended to

read as follows:

(a) In this section, "abatement period" means the period

during which all or a portion of the value of real property [ or

tangible personal property ] that is the subject of a tax abatement

agreement is exempt from taxation.

SECTION 42. Sections 312.204(a), (e), and (g), Tax Code,

are amended to read as follows:

(a) The governing body of a municipality eligible to enter

into tax abatement agreements under Section 312.002 may agree in

writing with the owner of taxable real property that is located in a

reinvestment zone, but that is not in an improvement project

financed by tax increment bonds, to exempt from taxation a portion

of the value of the real property [ or of tangible personal property

located on the real property, or both, ] for a period not to exceed

10 years, on the condition that the owner of the property make

specific improvements or repairs to the property. The governing

body of an eligible municipality may agree in writing with the owner

of a leasehold interest in tax-exempt real property that is located

in a reinvestment zone, but that is not in an improvement project

financed by tax increment bonds, to exempt a portion of the value of

property subject to ad valorem taxation, including the leasehold

interest or [ , ] improvements [ , or tangible personal property ]

located on the real property, for a period not to exceed 10 years,

on the condition that the owner of the leasehold interest make

specific improvements or repairs to the real property. A tax

abatement agreement under this section is subject to the rights of

holders of outstanding bonds of the municipality. An agreement

exempting taxable real property or leasehold interests or

improvements on tax-exempt real property may provide for the

exemption of such taxable interests in each year covered by the

agreement only to the extent its value for that year exceeds its

value for the year in which the agreement is executed. [ An

agreement exempting tangible personal property located on taxable

or tax-exempt real property may provide for the exemption of

tangible personal property located on the real property in each

year covered by the agreement other than tangible personal property

that was located on the real property at any time before the period

covered by the agreement with the municipality, including inventory

and supplies. ] In a municipality that has a comprehensive zoning

ordinance, an improvement, repair, development, or redevelopment

taking place under an agreement under this section must conform to

the comprehensive zoning ordinance.

(e) The governing body of a municipality eligible to enter

into tax abatement agreements under Section 312.002 may agree in

writing with the owner or lessee of real property that is located in

a reinvestment zone to exempt from taxation for a period not to

exceed 10 years a portion of the value of the real property [ or of

personal property, or both, ] located within the zone and owned or

leased by a certificated air carrier, on the condition that the

certificated air carrier make specific real property improvements

or lease for a term of 10 years or more real property improvements

located within the reinvestment zone. An agreement may provide for

the exemption of the real property in each year covered by the

agreement to the extent its value for that year exceeds its value

for the year in which the agreement is executed. [ An agreement may

provide for the exemption of the personal property owned or leased

by a certificated air carrier located within the reinvestment zone

in each year covered by the agreement other than specific personal

property that was located within the reinvestment zone at any time

before the period covered by the agreement with the municipality. ]

(g) Notwithstanding the other provisions of this chapter,

the governing body of a municipality eligible to enter into tax

abatement agreements under Section 312.002 may agree in writing

with the owner of real property that is located in a reinvestment

zone to exempt from taxation for a period not to exceed five years a

portion of the value of the real property [ or of tangible personal

property located on the real property, or both, ] that is used to

provide housing for military personnel employed at a military

facility located in or near the municipality. An agreement may

provide for the exemption of the real property in each year covered

by the agreement only to the extent its value for that year exceeds

its value for the year in which the agreement is executed. [ An

agreement may provide for the exemption of tangible personal

property located on the real property in each year covered by the

agreement other than tangible personal property that was located on

the real property at any time before the period covered by the

agreement with the municipality and other than inventory or

supplies. ] The governing body of the municipality may adopt

guidelines and criteria for tax abatement agreements entered into

under this subsection that are different from the guidelines and

criteria that apply to tax abatement agreements entered into under

another provision of this section. Tax abatement agreements

entered into under this subsection are not required to contain

identical terms for the portion of the value of the property that is

to be exempt or for the duration of the exemption as tax abatement

agreements entered into with the owners of property in the

reinvestment zone under another provision of this section.

SECTION 43. Section 312.210(b), Tax Code, is amended to

read as follows:

(b) A tax abatement agreement with the owner of real

property [ or tangible personal property ] that is located in the

reinvestment zone described by Subsection (a) and in a school

district that has a local revenue level that does not exceed the

level established under Section 48.257, Education Code, must exempt

from taxation:

(1) the portion of the value of the property in the

amount specified in the joint agreement among the municipality,

county, and junior college district; and

(2) an amount equal to 10 percent of the maximum

portion of the value of the property that may under Section

312.204(a) be otherwise exempted from taxation.

SECTION 44. Section 312.211(a), Tax Code, is amended to

read as follows:

(a) This section applies only to [ :

[ (1) ] real property:

(1) [ (A) ] that is located in a reinvestment zone;

(2) [ (B) ] that is not in an improvement project

financed by tax increment bonds; and

(3) [ (C) ] that is the subject of a voluntary cleanup

agreement under Section 361.606, Health and Safety Code [ ; and

[ (2) tangible personal property located on the real

property ].

SECTION 45. Sections 312.402(a), (a-1), and (a-3), Tax

Code, are amended to read as follows:

(a) The commissioners court may execute a tax abatement

agreement with the owner of taxable real property located in a

reinvestment zone designated under this subchapter [ or with the

owner of tangible personal property located on real property in a

reinvestment zone ] to exempt from taxation all or a portion of the

value of the real property [ , all or a portion of the value of the

tangible personal property located on the real property, or all or a

portion of the value of both ].

(a-1) The commissioners court may execute a tax abatement

agreement with the owner of a leasehold interest in tax-exempt real

property located in a reinvestment zone designated under this

subchapter to exempt all or a portion of the value of the leasehold

interest in the real property. The court may execute a tax

abatement agreement with the owner of [ tangible personal property

or ] an improvement located on tax-exempt real property that is

located in a designated reinvestment zone to exempt all or a portion

of the value of the [ tangible personal property or ] improvement

located on the real property.

(a-3) The commissioners court may execute a tax abatement

agreement with a lessee of taxable real property located in a

reinvestment zone designated under this subchapter to exempt from

taxation all or a portion of the value of the fixtures,

improvements, or other real property owned by the lessee and

located on the property that is subject to the lease [ , all or a

portion of the value of tangible personal property owned by the

lessee and located on the real property that is the subject of the

lease, or all or a portion of the value of both the fixtures,

improvements, or other real property and the tangible personal

property described by this subsection ].

SECTION 46. Section 71.041(5), Agriculture Code, is amended

to read as follows:

(5) "Nursery stock weather protection unit" means a

plant cover consisting of a series of removable, portable metal

hoops, covered by nonreusable plastic sheeting, shade cloth, or

other similar removable material, used exclusively for protecting

nursery products from weather elements. A nursery stock weather

protection unit is an implement of husbandry for all purposes[ ,

including Article VIII, Section 19a, of the Texas Constitution ].

SECTION 47. Section 93.001(2), Business & Commerce Code, is

amended to read as follows:

(2) "Heavy equipment" means self-propelled,

self-powered, or pull-type equipment, including farm equipment or a

diesel engine, that weighs at least 1,500 pounds and is intended to

be used for agricultural, construction, industrial, maritime,

mining, or forestry uses. The term does not include a motor

vehicle that is required by:

(A) Chapter 501, Transportation Code, to be

titled; or

(B) Chapter 502, Transportation Code, to be

registered [ has the meaning assigned by Section 23.1241, Tax Code ].

SECTION 48. Sections 89.003(a) and (b), Finance Code, are

amended to read as follows:

(a) Each association and each federal association shall

render for ad valorem taxation all of its personal property, other

than tangible personal property [ furniture, fixtures, equipment,

and automobiles ], as a whole at the value remaining after deducting

the following from the total value of its entire assets:

(1) all debts that it owes;

(2) all tax-free securities that it owns;

(3) its loss reserves and surplus;

(4) its savings liability; [ and ]

(5) the appraised value of its [ furniture, fixtures,

and ] real property ; and

(6) the value of its tangible personal property .

(b) The association or federal association shall render the

personal property, other than tangible personal property

[ furniture, fixtures, equipment, and automobiles ], to the chief

appraiser of the appraisal district in the county in which its

principal office is located.

SECTION 49. Sections 403.302(d) and (i), Government Code,

as effective until January 1, 2027, are amended to read as follows:

(d) For the purposes of this section, "taxable value" means

the market value of all taxable property less:

(1) the total dollar amount of any residence homestead

exemptions lawfully granted under Section 11.13(b) or (c), Tax

Code, in the year that is the subject of the study for each school

district;

(2) one-half of the total dollar amount of any

residence homestead exemptions granted under Section 11.13(n), Tax

Code, in the year that is the subject of the study for each school

district;

(3) the total dollar amount of any exemptions granted

before May 31, 1993, within a reinvestment zone under agreements

authorized by Chapter 312, Tax Code;

(4) subject to Subsection (e), the total dollar amount

of any captured appraised value of property that:

(A) is within a reinvestment zone created on or

before May 31, 1999, or is proposed to be included within the

boundaries of a reinvestment zone as the boundaries of the zone and

the proposed portion of tax increment paid into the tax increment

fund by a school district are described in a written notification

provided by the municipality or the board of directors of the zone

to the governing bodies of the other taxing units in the manner

provided by former Section 311.003(e), Tax Code, before May 31,

1999, and within the boundaries of the zone as those boundaries

existed on September 1, 1999, including subsequent improvements to

the property regardless of when made;

(B) generates taxes paid into a tax increment

fund created under Chapter 311, Tax Code, under a reinvestment zone

financing plan approved under Section 311.011(d), Tax Code, on or

before September 1, 1999; and

(C) is eligible for tax increment financing under

Chapter 311, Tax Code;

(5) the total dollar amount of any captured appraised

value of property that:

(A) is within a reinvestment zone:

(i) created on or before December 31, 2008,

by a municipality with a population of less than 18,000; and

(ii) the project plan for which includes

the alteration, remodeling, repair, or reconstruction of a

structure that is included on the National Register of Historic

Places and requires that a portion of the tax increment of the zone

be used for the improvement or construction of related facilities

or for affordable housing;

(B) generates school district taxes that are paid

into a tax increment fund created under Chapter 311, Tax Code; and

(C) is eligible for tax increment financing under

Chapter 311, Tax Code;

(6) [ the total dollar amount of any exemptions granted

under Section 11.251 or 11.253, Tax Code;

[ (7) ] the difference between the comptroller's

estimate of the market value and the productivity value of land that

qualifies for appraisal on the basis of its productive capacity,

except that the productivity value estimated by the comptroller may

not exceed the fair market value of the land;

(7) [ (8) ] the portion of the appraised value of

residence homesteads of individuals who receive a tax limitation

under Section 11.26, Tax Code, on which school district taxes are

not imposed in the year that is the subject of the study, calculated

as if the residence homesteads were appraised at the full value

required by law;

(8) [ (9) ] a portion of the market value of property

not otherwise fully taxable by the district at market value because

of action required by statute or the constitution of this state[ ,

other than Section 11.311, Tax Code, ] that, if the tax rate adopted

by the district is applied to it, produces an amount equal to the

difference between the tax that the district would have imposed on

the property if the property were fully taxable at market value and

the tax that the district is actually authorized to impose on the

property, if this subsection does not otherwise require that

portion to be deducted;

(9) [ (10) the market value of all tangible personal

property, other than manufactured homes, owned by a family or

individual and not held or used for the production of income;

[ (11) ] the appraised value of property the collection

of delinquent taxes on which is deferred under Section 33.06, Tax

Code;

(10) [ (12) ] the portion of the appraised value of

property the collection of delinquent taxes on which is deferred

under Section 33.065, Tax Code;

(11) [ (13) ] the amount by which the market value of

property to which Section 23.23 or 23.231, Tax Code, applies

exceeds the appraised value of that property as calculated under

Section 23.23 or 23.231, Tax Code, as applicable; and

(12) [ (14) ] the total dollar amount of any exemptions

granted under Section 11.35, Tax Code.

(i) If the comptroller determines in the study that the

market value of property in a school district as determined by the

appraisal district that appraises property for the school district,

less the total of the amounts and values listed in Subsection (d) as

determined by that appraisal district, is valid, the comptroller,

in determining the taxable value of property in the school district

under Subsection (d), shall for purposes of Subsection (d)(11)

[ (d)(13) ] subtract from the market value as determined by the

appraisal district of properties to which Section 23.23 or 23.231,

Tax Code, applies the amount by which that amount exceeds the

appraised value of those properties as calculated by the appraisal

district under Section 23.23 or 23.231, Tax Code, as

applicable. If the comptroller determines in the study that the

market value of property in a school district as determined by the

appraisal district that appraises property for the school district,

less the total of the amounts and values listed in Subsection (d) as

determined by that appraisal district, is not valid, the

comptroller, in determining the taxable value of property in the

school district under Subsection (d), shall for purposes of

Subsection (d)(11) [ (d)(13) ] subtract from the market value as

estimated by the comptroller of properties to which Section 23.23

or 23.231, Tax Code, applies the amount by which that amount exceeds

the appraised value of those properties as calculated by the

appraisal district under Section 23.23 or 23.231, Tax Code, as

applicable.

SECTION 50. Sections 403.302(d) and (i), Government Code,

as effective January 1, 2027, are amended to read as follows:

(d) For the purposes of this section, "taxable value" means

the market value of all taxable property less:

(1) the total dollar amount of any residence homestead

exemptions lawfully granted under Section 11.13(b) or (c), Tax

Code, in the year that is the subject of the study for each school

district;

(2) one-half of the total dollar amount of any

residence homestead exemptions granted under Section 11.13(n), Tax

Code, in the year that is the subject of the study for each school

district;

(3) the total dollar amount of any exemptions granted

before May 31, 1993, within a reinvestment zone under agreements

authorized by Chapter 312, Tax Code;

(4) subject to Subsection (e), the total dollar amount

of any captured appraised value of property that:

(A) is within a reinvestment zone created on or

before May 31, 1999, or is proposed to be included within the

boundaries of a reinvestment zone as the boundaries of the zone and

the proposed portion of tax increment paid into the tax increment

fund by a school district are described in a written notification

provided by the municipality or the board of directors of the zone

to the governing bodies of the other taxing units in the manner

provided by former Section 311.003(e), Tax Code, before May 31,

1999, and within the boundaries of the zone as those boundaries

existed on September 1, 1999, including subsequent improvements to

the property regardless of when made;

(B) generates taxes paid into a tax increment

fund created under Chapter 311, Tax Code, under a reinvestment zone

financing plan approved under Section 311.011(d), Tax Code, on or

before September 1, 1999; and

(C) is eligible for tax increment financing under

Chapter 311, Tax Code;

(5) the total dollar amount of any captured appraised

value of property that:

(A) is within a reinvestment zone:

(i) created on or before December 31, 2008,

by a municipality with a population of less than 18,000; and

(ii) the project plan for which includes

the alteration, remodeling, repair, or reconstruction of a

structure that is included on the National Register of Historic

Places and requires that a portion of the tax increment of the zone

be used for the improvement or construction of related facilities

or for affordable housing;

(B) generates school district taxes that are paid

into a tax increment fund created under Chapter 311, Tax Code; and

(C) is eligible for tax increment financing under

Chapter 311, Tax Code;

(6) [ the total dollar amount of any exemptions granted

under Section 11.251 or 11.253, Tax Code;

[ (7) ] the difference between the comptroller's

estimate of the market value and the productivity value of land that

qualifies for appraisal on the basis of its productive capacity,

except that the productivity value estimated by the comptroller may

not exceed the fair market value of the land;

(7) [ (8) ] the portion of the appraised value of

residence homesteads of individuals who receive a tax limitation

under Section 11.26, Tax Code, on which school district taxes are

not imposed in the year that is the subject of the study, calculated

as if the residence homesteads were appraised at the full value

required by law;

(8) [ (9) ] a portion of the market value of property

not otherwise fully taxable by the district at market value because

of action required by statute or the constitution of this state[ ,

other than Section 11.311, Tax Code, ] that, if the tax rate adopted

by the district is applied to it, produces an amount equal to the

difference between the tax that the district would have imposed on

the property if the property were fully taxable at market value and

the tax that the district is actually authorized to impose on the

property, if this subsection does not otherwise require that

portion to be deducted;

(9) [ (10) the market value of all tangible personal

property, other than manufactured homes, owned by a family or

individual and not held or used for the production of income;

[ (11) ] the appraised value of property the collection

of delinquent taxes on which is deferred under Section 33.06, Tax

Code;

(10) [ (12) ] the portion of the appraised value of

property the collection of delinquent taxes on which is deferred

under Section 33.065, Tax Code;

(11) [ (13) ] the amount by which the market value of a

residence homestead to which Section 23.23, Tax Code, applies

exceeds the appraised value of that property as calculated under

that section; and

(12) [ (14) ] the total dollar amount of any exemptions

granted under Section 11.35, Tax Code.

(i) If the comptroller determines in the study that the

market value of property in a school district as determined by the

appraisal district that appraises property for the school district,

less the total of the amounts and values listed in Subsection (d) as

determined by that appraisal district, is valid, the comptroller,

in determining the taxable value of property in the school district

under Subsection (d), shall for purposes of Subsection (d)(11)

[ (d)(13) ] subtract from the market value as determined by the

appraisal district of residence homesteads to which Section 23.23,

Tax Code, applies the amount by which that amount exceeds the

appraised value of those properties as calculated by the appraisal

district under Section 23.23, Tax Code. If the comptroller

determines in the study that the market value of property in a

school district as determined by the appraisal district that

appraises property for the school district, less the total of the

amounts and values listed in Subsection (d) as determined by that

appraisal district, is not valid, the comptroller, in determining

the taxable value of property in the school district under

Subsection (d), shall for purposes of Subsection (d)(11) [ (d)(13) ]

subtract from the market value as estimated by the comptroller of

residence homesteads to which Section 23.23, Tax Code, applies the

amount by which that amount exceeds the appraised value of those

properties as calculated by the appraisal district under Section

23.23, Tax Code.

SECTION 51. Section 403.602(9), Government Code, as added

by Chapter 377 (H.B. 5), Acts of the 88th Legislature, Regular

Session, 2023, is amended to read as follows:

(9) "Eligible property" means property that :

(A) is used as part of an eligible project that is

wholly owned by an applicant or leased by an applicant under a

capitalized lease ; and

(B) consists of[ :

[ (A) ] a new building or expansion of an existing

building, including a permanent, nonremovable component of a

building, that is:

(i) constructed after the date the

agreement pertaining to the project is entered into; and

(ii) located in an area designated as a

reinvestment zone under Chapter 311 or 312, Tax Code, or as an

enterprise zone under Chapter 2303 of this code, at the time the

agreement pertaining to the project is entered into[ ; or

[ (B) tangible personal property, other than

inventory, first located in the zone described by Paragraph (A)(ii)

after the date the agreement pertaining to the project is entered

into ].

SECTION 52. Section 503.038(a), Transportation Code, as

effective July 1, 2025, is amended to read as follows:

(a) The department may cancel a dealer's general

distinguishing number if the dealer:

(1) falsifies or forges a title document, including an

affidavit making application for a certified copy of a title;

(2) files a false or forged tax document, including a

sales tax affidavit;

(3) fails to take assignment of any basic evidence of

ownership, including a certificate of title or manufacturer's

certificate, for a vehicle the dealer acquires;

(4) fails to assign any basic evidence of ownership,

including a certificate of title or manufacturer's certificate, for

a vehicle the dealer sells;

(5) uses or permits the use of a dealer's license plate

on a vehicle that the dealer does not own or control or that is not

in stock and offered for sale;

(6) makes a material misrepresentation in an

application or other information filed with the department;

(7) fails to maintain the qualifications for a general

distinguishing number;

(8) fails to provide to the department within 30 days

after the date of demand by the department satisfactory and

reasonable evidence that the person is regularly and actively

engaged in business as a wholesale or retail dealer;

(9) has been licensed for at least 12 months and has

not assigned at least five vehicles during the previous 12-month

period;

(10) [ has failed to demonstrate compliance with

Sections 23.12, 23.121, and 23.122, Tax Code;

[ (11) ] uses or allows the use of the dealer's general

distinguishing number or the location for which the general

distinguishing number is issued to avoid the requirements of this

chapter; or

(11) [ (12) ] otherwise violates this chapter or a rule

adopted under this chapter.

SECTION 53. (a) The following provisions of the Tax Code

are repealed:

(1) Section 6.24(c);

(2) Sections 11.01(c), (d), and (e);

(3) Section 11.11(h);

(4) Section 11.14;

(5) Section 11.141;

(6) Section 11.145;

(7) Section 11.15;

(8) Section 11.16;

(9) Section 11.161;

(10) Section 11.23(f);

(11) Section 11.25;

(12) Section 11.251;

(13) Section 11.252;

(14) Section 11.253;

(15) Section 11.254;

(16) Section 11.27(a-1);

(17) Section 11.271;

(18) Section 11.311;

(19) Section 11.315;

(20) Section 11.33;

(21) Section 11.36, as added by Chapter 364 (S.B.

2289), Acts of the 88th Legislature, Regular Session, 2023;

(22) Section 11.437;

(23) Section 11.4391;

(24) Section 21.02;

(25) Section 21.021;

(26) Section 21.03;

(27) Section 21.031;

(28) Section 21.04;

(29) Section 21.05;

(30) Section 21.055;

(31) Section 21.07;

(32) Section 21.09;

(33) Section 21.10;

(34) Sections 22.01(e), (i), (j), (k), and (m);

(35) Sections 22.04(b), (c), and (d);

(36) Sections 22.07(a) and (b);

(37) Section 23.121;

(38) Section 23.1211;

(39) Section 23.122;

(40) Section 23.123;

(41) Section 23.124;

(42) Section 23.1241;

(43) Section 23.1242;

(44) Section 23.1243;

(45) Section 23.125;

(46) Section 23.126;

(47) Section 23.127;

(48) Section 23.128;

(49) Section 23.129;

(50) Section 23.24;

(51) Chapter 24;

(52) Section 25.25(c-1);

(53) Section 33.11;

(54) Section 41.413(a);

(55) Section 41.47(c-1);

(56) Section 42.03; and

(57) Section 42.05.

(b) Sections 49.302(b) and 49.304, Education Code, are

repealed.

(c) Section 89.003(c), Finance Code, is repealed.

(d) Sections 379B.011(c), (d), and (e) and 507.201(b),

Local Government Code, are repealed.

(e) Sections 3501.004(c), (d), and (e), Special District

Local Laws Code, are repealed.

SECTION 54. Sections 23.121, 23.122, 23.123, 23.124,

23.125, 23.126, 23.127, and 23.128, Tax Code, as repealed by this

Act, apply only to an offense committed before the effective date of

this Act. An offense committed before the effective date of this

Act is governed by the law in effect on the date the offense was

committed, and the former law is continued in effect for that

purpose. For purposes of this section, an offense was committed

before the effective date of this Act if any element of the offense

occurred before that date.

SECTION 55. The changes made to Section 25.25, Tax Code, by

this Act apply only to a motion to correct an appraisal roll filed

on or after the effective date of this Act. A motion to correct an

appraisal roll filed before the effective date of this Act is

governed by the law in effect on the date the motion was filed, and

the former law is continued in effect for that purpose.

SECTION 56. Sections 403.302(d) and (i), Government Code, as

amended by this Act, apply only to the determination of the total

taxable value of property in a school district for a tax year that

begins on or after the effective date of this Act. The

determination of the total taxable value of property in a school

district for a tax year that begins before the effective date of

this Act is governed by the law in effect immediately before that

date, and the former law is continued in effect for that purpose.

SECTION 57. Notwithstanding the changes in law made by this

Act to the provisions of the Tax Code, Agriculture Code, Business &

Commerce Code, Finance Code, Government Code, and Transportation

Code amended by this Act and the repeal by this Act of provisions of

the Tax Code and Finance Code, each of those provisions, as it

existed immediately before January 1, 2026, is continued in effect

for the purpose of the levy and collection of an ad valorem tax on

tangible personal property imposed:

(1) before January 1, 2026; or

(2) pursuant to Section 1(b-1), Article VIII, Texas

Constitution.

SECTION 58. To the extent of any conflict, this Act prevails

over another Act of the 89th Legislature, Regular Session, 2025,

relating to nonsubstantive additions to and corrections in enacted

codes.

SECTION 59. Except as otherwise provided by this Act, this

Act takes effect January 1, 2026, but only if the constitutional

amendment proposed by the 89th Legislature, Regular Session, 2025,

exempting tangible personal property from ad valorem taxation is

approved by the voters. If that amendment is not approved by the

voters, this Act has no effect.