Bill widening state aid for veteran tax exemptions

The text as introduced · 709 words

89R1873 JBD-D

By: Perez of El Paso
H.B. No. 5217

A BILL TO BE ENTITLED

AN ACT

relating to the provision of state aid to certain local governments

disproportionately affected by the granting of ad valorem tax

relief to disabled veterans and surviving spouses of certain armed

services members.

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

SECTION 1. The heading to Section 140.011, Local Government

Code, is amended to read as follows:

Sec. 140.011. LOCAL GOVERNMENTS DISPROPORTIONATELY

AFFECTED BY PROPERTY TAX RELIEF FOR DISABLED VETERANS AND SURVIVING

SPOUSES OF CERTAIN ARMED SERVICES MEMBERS .

SECTION 2. Section 140.011(a)(3), Local Government Code, is

amended to read as follows:

(3) "Qualified local government" means a local

government entitled to a military exemption [ disabled veteran ]

assistance payment under this section.

SECTION 3. Sections 140.011(b), (c), (d), (e), (f), and

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

(b) To serve the state purpose of ensuring that the cost of

providing ad valorem tax relief to disabled veterans and surviving

spouses of members of the armed services killed or fatally injured

in the line of duty is shared equitably among the residents of this

state, a local government is entitled to a military exemption

[ disabled veteran ] assistance payment from the state for each

fiscal year that the local government is a qualified local

government. A local government is a qualified local government for

a fiscal year if the amount of lost ad valorem tax revenue

calculated under Subsection (c) for that fiscal year is equal to or

greater than two percent of the local government's general fund

revenue for that fiscal year.

(c) For the purposes of this section, the amount of a local

government's lost ad valorem tax revenue for a fiscal year is

calculated by multiplying the ad valorem tax rate adopted by the

local government under Section 26.05, Tax Code, for the tax year in

which the fiscal year begins by the total appraised value of all

property located in the local government that is granted an

exemption from taxation under Section 11.131 or 11.133 , Tax Code,

for that tax year.

(d) A military exemption [ disabled veteran ] assistance

payment made to a qualified local government for a fiscal year is

calculated by subtracting from the local government's lost ad

valorem tax revenue calculated under Subsection (c) for that fiscal

year an amount equal to one percent of the local government's

general fund revenue for that fiscal year.

(e) Not later than May [ April ] 1 of the first year following

the end of a fiscal year for which a qualified local government is

entitled to a military exemption [ disabled veteran ] assistance

payment, a qualified local government may submit an application to

the comptroller to receive a military exemption [ disabled veteran ]

assistance payment for that fiscal year. The application must be

made on a form prescribed by the comptroller. The comptroller may

require the qualified local government to submit an independent

audit otherwise required by law to be prepared for the local

government for the fiscal year for which a qualified local

government is entitled to the payment.

(f) A qualified local government that does not submit an

application to the comptroller by the date prescribed by Subsection

(e) is not entitled to a military exemption [ disabled veteran ]

assistance payment for the fiscal year for which that deadline

applies.

(g) The comptroller shall review each application by a local

government to determine whether the local government is entitled to

a military exemption [ disabled veteran ] assistance payment. If the

comptroller determines that the local government is entitled to the

payment, the comptroller shall remit the payment from available

funds to the qualified local government not later than the 30th day

after the date the application for the payment is made.

SECTION 4. Section 140.011, Local Government Code, as

amended by this Act, applies to the deadline for a local government

to apply for, and the calculation of the amount of, a military

exemption assistance payment beginning with the fiscal year of the

local government that ends in the 2025 tax year.

SECTION 5. This Act takes effect September 1, 2025.