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Texas Legislative Update- Property Tax Bill Summaries

by DMA Staff | Jun 08, 2017
DMA-Texas-Legislative-Update-June 8 2017

DuCharme, McMillen & Associates, Inc. (DMA) provides this information on property tax bills enacted by the 85th Texas Legislature Regular Session. The bills summarized below have been passed by both houses of the Legislature and sent to the Governor. Governor Greg Abbott has until June 18, 2017, to sign or veto the bills, or allow them to become law without his signature. The content and status of any specific bill is available here

Bills that are noted to take effect “immediately upon passage” will be effective on the date Governor Abbott signs the bill or on June 18, 2017, if he does not sign or veto the bill. 

We have categorized the property tax bills based on the chapters of Title 1 (Property Tax), Texas Tax Code. Some bills have subject matter that cut across various chapters, and the proposals within those bills are broken out based on pertinent chapters. 

Chapter 6. Local Administration
SB 929 (Hughes) amends Tax Code §6.231(b) to require county tax assessor-collectors who assess or collect property taxes to successfully complete at least 40 hours of continuing education courses on the assessment and collection of property taxes, including a course dedicated to Chapter 26 (entitled Assessment), within one year of taking office. The Governor signed the bill on May 18, 2017, and the bill applies to a county assessor-collector whose first term of office begins on or after May 18, 2017.

Chapter 11. Taxable Property and Exemptions 
HB 150 (Bell, Cecil) amends Tax Code §11.132(b) to allow a partially disabled veteran to claim the donated residence homestead exemption based on the disabled veteran’s disability rating even if the disabled veteran pays some cost in the form of a cash payment, a mortgage, or both in an aggregate amount that is not more than 50 percent of the good faith estimate of the market value of the residential property on the date that charitable organization made the donation. [Note: The current statute authorizes the partial exemption only if the property is donated at no cost to a disabled veteran.] The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect for tax years beginning on or after January 1, 2018. The property tax exemption is contingent on the passage of HJR 21 (Bell, Cecil), which proposes a constitutional amendment authorizing the legislature to provide such an exemption from ad valorem tax. HJR 21 was enrolled on May 23, 2017, and the constitutional amendment will be subject to voters’ approval at the election to be held on November 7, 2017. 

HB 626 (Workman, Paul) makes the following changes:

  • amends Tax Code §11.431 to change the time period within which a chief appraiser may accept a late application for residence homestead from one year to two years within the delinquency date of the taxes on the homestead;
  • requires a chief appraiser to notify the tax collector of each unit in which the property is located within 30 days of the approval if a late application is approved after the approval of the appraisal records by the appraisal review board; and
  • requires the tax collector to issue a refund within 60 days of the date of the chief appraisal’s notification of the exemption approval if taxes were paid before the approval of the application.

The Governor signed the bill on May 29, 2017, and the bill takes effect on September 1, 2017. The changes in law made to Tax Code §§11.431 and 11.439 apply only to an application for an exemption filed for the 2016 tax year or a later tax year.

HB 1101 (Pickett, Joe) amends Tax Code §11.43 to preclude a chief appraiser from requesting the submission of a new application from a disabled veteran who has a residence homestead exemption under Tax Code §11.131 if the disabled veteran has a permanent total disability determined by the United States Department of Veterans Affairs under 38 C.F.R. Section 4.15. The Governor signed the bill on May 26, 2017, and the bill takes effect on January 1, 2018.

HB 2228 (Murphy, Jim) amends Tax Code §11.4391 to provide that a chief appraiser is to accept and approve or deny an application for an exemption for Freeport goods under Tax Code §11.251 (Freeport Goods) if the application is filed by June 15 (rather than the current provision which is before the date the appraisal review board approves the appraisal records). The Governor signed the bill on June 1, 2017, and the bill takes effect on January 1, 2018.

HB 2999 (Bonnen, Dennis) amends Tax Code §11.23(j-1), which currently provides an exemption for medical center development in populous counties. The bill makes updates by specifying that the subsection applies to a county with a population of 3.3 million or more and by changing the references to the definition of nonprofit corporation and making other clarifications of exempt uses. The Governor signed the bill on May 29, 2017, and the bill takes effect on January 1, 2018. The changes apply only to ad valorem tax years beginning on or after January 1, 2018.

HB 3103 (Darby, Drew) provides context to Tax Code §11.01(c)(3), which currently provides that the state has jurisdiction to tax tangible personal property if the property is used continually, whether regularly or irregularly, in Texas. The bill adds a new subsection that provides that “property is considered to be used continually, whether regularly or irregularly, in this state if the property is used in this state three or more times on regular routes or for three or more completed assignments occurring in close succession throughout the year.  For purposes of this subsection, a series of events are considered to occur in close succession throughout the year if they occur in sequence within a short period at intervals from the beginning to the end of the year.” The bill provides that the changes are a “clarification of existing law”. The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect immediately upon passage. 

SB 15 (Huffines, Donald) adds Tax Code §11.134 to provide an exemption for the total appraised value of a residence homestead owned by a surviving spouse of a first responder who is killed or fatally injured in the line of duty. The bill provides that:

  • the surviving spouse must be an eligible survivor for purposes of Chapter 615, Government Code, as determined by the Employees Retirement System of Texas, and must not have remarried since the death of the first responder;
  • the exemption applies regardless of the death of the first responder as long as the surviving spouse meets the qualification requirements; and
  • the exemption transfers to the surviving spouse’s acquisition of a new residence homestead if the surviving spouse has not remarried since the death of the first responder. The exemption amount is equal to the dollar amount of the exemption of the first property in the last year of ownership.

The enrolled bill was sent to the Governor on May 26, 2017, and is to take effect for tax years beginning on or after January 1, 2018. The bill is contingent on the passage of SJR 1 (Campbell, Donna), which proposes a constitutional amendment authorizing the legislature to grant such an exemption. SJR 1 was enrolled on May 23, 2017, and the constitutional amendment will be subject to voters’ approval at the election to be held on November 7, 2017. 

SB 1345 (Watson, Kirk) amends Tax Code §11.18(d) to expand the property tax exemption for charitable organizations to include a charitable organization that provides, without regard to the beneficiaries' ability to pay, tax return preparation services and assistance with other financial matters. The bill was sent to the Governor on May 28, 2017, and is to take effect of January 1, 2018. The changes apply to an ad valorem tax year that begins on or after January 1, 2018.

Chapter 21. Taxable Situs
HB 2228 (Murphy, Jim) amends Tax Code §21.09, which currently requires the filing of an application to claim the allocation authorized by Tax Code §21.03 (Interstate Allocation), §21.031 (Allocation of Vessels and Other Watercraft), §21.05 (Commercial Aircraft) or §21.055 (Business Aircraft). The bill provides the following:

  • moves the annual filing deadline for a completed allocation application from May 1 to April 1; 
  • changes the extended filing deadline for property that was not on the appraisal roll in the preceding year from the 45th day to the 30th day after the receipt of the notice of appraisal value; and
  • changes the chief appraiser’s extension for filing an allocation application for good cause from a period not exceed 60 days to a period not to exceed 30 days.

The Governor signed the bill on June 1, 2017, and the bill takes effect on January 1, 2018.

Chapter 22. Information from Taxpayer
HB 2228 (Murphy, Jim) amends Tax Code §22.23, which currently requires that rendition statements and property reports must be delivered to the chief appraiser after January 1, but no later than April 15 unless otherwise provided and subject to allowable extensions. The bill provides the following changes in a county in which one or more taxing units exempt property under Tax Code §11.251 (Freeport Goods):

  • rendition statements and property reports for property located in an appraisal district in which one or more taxing units exempt property under Tax Code §11.251 (Freeport Goods) must be delivered to the chief appraiser by April 1. Upon the written request by the property owner, the chief appraiser may extend the filing deadline to May 1 and may further extend the deadline for an additional 15 days for good cause shown in writing; and 
  • rendition statements and property reports for property regulated by the Public Utility Commission of Texas, the Railroad Commission of Texas, the federal Surface Transportation Board, or the Federal Energy Regulatory Commission must be delivered to the chief appraiser by April 30, except as provided by Tax Code §22.02 (Rendition of Property that Lost Exemption or is Denied Exemption). The chief appraiser may extend the filing deadline 15 days for good cause shown in writing by the property owner.

The Governor signed the bill on June 1, 2017, and the bill takes effect on January 1, 2018.

Chapter 23. Appraisal Methods and Procedures
HB 777 (Ashby, Trenton) adds Tax Code §23.523 to provide that a land’s eligibility for appraisal as agricultural use property does not end because the land ceases to be devoted principally to agricultural use to the degree of intensity generally accepted in the area if the land owner is a member of the U.S. armed services who is deployed or stationed outside Texas and intends to resume the degree of intensity within 180 days of the date the owner ceases to be deployed or stationed outside Texas. The owner must notify the appraisal office in writing within 30 days of the date of the owner is deployed or stationed outside Texas. However, if a person fails to provide the written notice to the appraisal district within 30 days of the owner’s deployment, the person may still be eligible if the written notice is provided within 90 days of the effective date of this bill. The Governor signed the bill on May 23, 2017, and the bill takes effect on May 23, 2017. The changes in law applies only to land owned by a member of the armed services of the United States who is deployed or stationed outside Texas on or after May 23, 2017. 

HB 1346 (Button, Angie) amends Tax Code §23.1242(b) and (f) to change the date on which a lessor of heavy-duty equipment must remit the unit property tax and file a statement of sale, lease, or rental of heavy-duty equipment from the 10th day to the 20th day of each month. The Governor signed the bill on May 23, 2017, and it is to take effect on September 1, 2017. The change in law applies to a dealer’s heavy equipment inventory tax statement required to be filed on or after September 1, 2017.  

HB 2019 (King, Tracy) amends provisions in Chapter 1201, Occupations Code, to update the regulation of manufactured homes, and makes the following changes to the Texas Tax Code: 

  • amends Tax Code §23.127(a)(9) to modify the definition of "retail manufactured housing inventory" to mean all units of manufactured housing that a retailer holds for sale at retail and that are defined as inventory by Occupations Code §1201.201 and amends Tax Code §21.127(a)(3) to modify the definition of “declaration” to apply to units of manufactured housing considered to be retail manufactured housing inventory; and 
  • amends Tax Code §23.127(m) to provide that a chief appraiser is to appraise retail manufactured housing inventory in the manner provided by Tax Code §21.127, except sales made predominantly to other retailers.

The Governor signed the bill on June 1, 2017, and the bill takes effect on September 1, 2017.

HB 3198 (Darby, Drew) adds Tax Code §23.524 that continues the land’s eligibility for appraisal as agricultural use even if a lessee under an oil and gas lease begins conducting oil and gas operations over which the Railroad Commission of Texas has jurisdiction on the land and if the portion of the land on which oil and gas operations are not being conducted otherwise continues to qualify for appraisal under this subchapter. The Governor signed the bill on June 1, 2017, and the bill takes effect on September 1, 2017.

SB 594 (Creighton, Brandon) modifies Tax Code §§23.52(d) and 23.73(b) to prescribe who must approve the Comptroller’s rule relating to the procedures for the appraisal districts to determine whether the requirements are met for open-space land and timber land for ad valorem tax purposes. In lieu of the approval of the majority of a committee that is comprised of designated elected officials or their designees, the bill requires the approval of the Comptroller with the review and counsel of the Department of Agricultural relating to open-space land procedures and the review and counsel of the Texas A&M Forest Service relating to timber land procedures. The Governor signed the bill on May 18, 2017, and the bill takes effect on January 1, 2018.

SB 1459 (Hinojosa, Chuy) adds Tax Code §23.524 to provide that a land’s eligibility for appraisal as agricultural use does not end because the land ceases to be devoted principally to agricultural use to the degree of intensity generally accepted in the area for the certain time period if:

  • the land is located in a pest management zone;
  • the land is appraised primarily on the basis of the production of citrus in the tax year in which the land owner executes an agreement to destroy, remove, or treat all the citrus trees located on the land that are or could become infested with pests with the Texas Citrus Pest and Disease Management Corporation, Inc., the Texas Department of Agriculture, or the United States Department of Agriculture; and
  • the cessation of use is caused by the destruction, removal, or treatment of the citrus trees located on the land under the terms of the agreement.

Within 30 days of the execution of the agreement, the land owner must notify the chief appraiser in writing of the owner’s intent to destroy, remove, or treat the citrus trees located on the land under the terms of the agreement and submit a copy of the agreement with the notification. The bill provides that the temporary cessation time period the land is eligible for appraisal as agricultural use begins on the date of execution of the agreement and ends 5 years from that date. The Governor signed the bill on May 19, 2017, and the bill takes effect on May 19, 2017. The change in law applies only to land owned by a person who executes an agreement described on or after May 19, 2017.

Chapter 25. Local Appraisal
SB 945 (Bettencourt, Paul) amends Tax Code §25.25(b) to allow a chief appraiser to change the appraisal roll at any time to correct an erroneous denial or cancellation of a residence homestead exemption that is claimed by an applicant who is disabled or is over 64 years old, or who is authorized to claim an exemption under Tax Code §11.13(q) (Surviving Spouse of an individual who qualifies for residence homestead), Tax Code §11.131 (Totally Disabled Veteran), or Tax Code §11.22 (Disabled Veteran). The Governor signed the bill on May 22, 2017, and the bill takes effect on May 22, 2017.

SB 1767 (Buckingham, Dawn) amends Tax Code §25.25(e) to provide that at the hearing on a motion for correction of the appraisal roll, 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.  The enrolled bill was sent to the Governor on May 27, 2017, and is to take effect on January 1, 2018. The change in law applies only to a motion to correct an appraisal roll filed on or after January 1, 2018.

SB 2242 (Hinojosa, Chuy) amends Tax Code §25.25 by adding a new provision that requires the chief appraiser to correct the appraisal roll and other appropriate records within 45 days from the date a dispute between taxing units as to geographic boundaries of property is resolved by agreement or by a final order of the Texas Supreme Court. The bill amends Chapter 72, Local Government Code, to authorize a property owner, in a case involving disputed, overlapping, or erroneously applied geographic boundaries between like taxing units, to file suit in the Texas Supreme Court to establish the correct geographic boundary between the taxing units and determine the amount of taxes owed on the property and the taxing unit or units to which the taxes are owed. The bill also adds Tax Code §31.112 that sets forth procedures for refund if the dispute is resolved after the property owner has made payment. The bill essentially addresses a property tax problem in Nueces and San Patricio Counties. The enrolled bill was sent to the Governor on May 28, 2017, and is to take effect immediately upon passage.

Miscellaneous: The following bills amend Tax Code §25.025(a) to expand the list of persons who may request that their home address remain confidential in appraisal records:

  • HB 457 (Holland, Justin) – a current or former peace officer as defined by Article 2.12, Code of Criminal Procedures, to include the peace officer’s spouse or surviving spouse and adult child. The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect immediately upon passage.
  • HB 1278 (Dutton, Harold) – a current or former district attorney, criminal district attorney, or county or municipal attorney whose jurisdiction includes any criminal law or child protective services matters. The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect immediately upon passage.
  • SB 42 (Zaffirini, Judith) - a federal or state judge as defined by Section 572.002, Government Code, or the spouse of a federal or state judge, beginning on the date the Office of Court Administration of the Texas Judicial System notifies the appraisal district of the judge's qualification for the judge's office. The Governor signed the bill May 27, 2017, and the bill takes effect on September 1, 2017.
  • SB 256 (Taylor, Van) - an individual who shows that the individual, the individual's child, or another person in the individual's household is a victim of family violence as defined by Section 71.004, Family Code, or a victim of sexual assault or abuse, stalking, or trafficking of persons, or a participant in the address confidentiality program administered by the attorney general under Subchapter C, Chapter 56, Code of Criminal Procedure. Each person must provide a prescribed form of proof. The Governor signed the bill on May 19, 2017, and the bill takes effect on May 19, 2017.
  • SB 510 (Zaffirini, Judith) – a current or former employee of a federal judge or state judge. The Governor signed the bill on May 27, 2017, and the bills takes effect on May 27, 2017.
  • SB 1576 (Perry, Charles) - a current or former employee of the Texas Civil Commitment Office or of the predecessor in function of the office or a division of the office. The Governor signed the bill on May 18, 2017, and the bill takes effect on September 1, 2017.

Chapter 26. Assessment
HB 2989 (Bonnen, Dennis) amends Tax Code §26.15(f), which currently authorizes a refund if a correction decreases the tax liability of a property after tax payment, by specifying the refund must be given to the property owner “who paid the tax”. [Note: The bill intends to address a situation where the refund is generated after property ownership has transferred.] The Governor signed the bill on May 26, 2017, and the bill takes effect on May 26, 2017. The change in law applies only to a refund made on or after May 26, 2017. 

Chapter 31. Collections
SB 1047 (Creighton, Brandon) amends Tax Code §31.032, which currently applies to real property that is either a residential homestead or owned or leased by a business entity with gross receipts of $5 million or less, that is located in a disaster area and that has been damaged as a result of the disaster. The bill amends subsection (b) to permit a property owner to pay property tax in four equal installments without penalty or interest if the first installment is paid before the delinquency date and is accompanied by notice to the taxing unit that the person will pay the remaining taxes in three equal installments. An exception to the deadline is made by permitting a property owner who pays the first installment with the required notice on the first day of the first month after the delinquency date. The bill specifies that the second installment is due April 1, the third installment is due June 1, and the final payment is due August 1. The enrolled bill was sent to the Governor on May 27, 2017, and is to take effect on January 1, 2018.

Chapter 33. Delinquency
HB 150 (Bell, Cecil) amends Tax Code §33.06(d) to lower the interest rate imposed on property tax deferred or abated for the residence homestead of a property owner who is 65 years old or older from 8% to 5%. The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect on January 1, 2018. The change in the interest applies only to interest that accrues during a deferral or abatement period on or after January 1, 2018, regardless of whether the deferral or abatement period began before that date or begins on or after that date. 

HB 217 (Canales, Terry) amends Tax Code §33.06 to allow a disabled veteran that qualifies for the exemption under Tax Code §11.22 (Disabled Veterans) to defer collection of a tax, abate a suit to collect a delinquent tax, or abate a sale to foreclose a tax lien on a property that the disabled veteran owns as a residence homestead. The Governor signed the bill on May 18, 2017, and the bill takes effect September 1, 2017.

HB 3389 (Schofield, Mike) amends Tax Code §33.73, by requiring the district clerk to collect the fees taxed as costs of suit and award them to the master in each delinquent tax suit for which a master is appointed under Tax Code §33.71, regardless of the disposition of the suit. Fees may not be collected or awarded in a suit dismissed by the master unless the master held at least one hearing on the suit or prepared for the suit for at least a number of hours equivalent to the time required to conduct a hearing. The change in law applies only to a delinquent tax suit for which a master is appointed that is filed on or after September 1, 2017. The Governor signed the bill on June 1, 2017, and the bill takes effect on September 1, 2017.

Chapter 41. Local Review – Appraisal Review Board (ARB)
HB 455 (Metcalf, Will) amends Tax Code §41.45 to allow a property owner to appear by telephone conference call at an appraisal review board (ARB) protest hearing to present arguments but is still required to offer any evidence by affidavit. The bill provides as follows:

  • requires the property owner who desires to make an appearance by telephone conference call to notify the ARB of the owner’s intent to appear by telephone in the owner’s notice of protest or by written noticed filed with the ABR at least 10 days before the ARB hearing;
  • permits the ARB to propose that the hearing be conducted by telephone conference call if the property owner agrees to it;
  • requires the ARB to provide a telephone number for the property owner to call to participate in the hearing and hold the hearing in a location equipped with telephone equipment that allows each board member and the other parties to the protest who are present at the hearing to hear the property owner;
  • requires the property owner to be responsible for providing access to a hearing to another person that the owner invites to participate in the hearing; and
  • specifies that the property owner does not waive the right to appear in person but when scheduling the hearing, the property owner must state in the affidavit that the property owner does not intend to appear in person or intends to appear by telephone conference call. If the affidavit does not contain such a statement and the property owner has not elected to appear by telephone conference call, the ARB shall consider the affidavit submission as the property owner’s intent not to appear at the hearing and is not required to consider the affidavit at the scheduled hearing. The ARB may consider the affidavit at a hearing designated for the specific purpose of processing affidavits.

The Governor signed the bill on May 23, 2017, and the bill takes effect on September 1, 2017. The changes apply to a protest under Chapter 41, Tax Code, for which a notice of protest is filed on or after September 1, 2017.

HB 804 (Dale, Tony) amends Tax Code §41.413, which currently provides that a lessee of tangible personal property or real property who is contractually obligated to reimburse the property owner for taxes imposed on the property is entitled to protest the appraised value of the property before the ARB if the property owner does not file a protest relating to the property. The bill provides as follows:

  • replaces the current requirement that a property owner must “timely” send a copy of any notice of reappraisal with the requirement that the property owner must send a copy of any notice of the appraised value of the property to the lessee within 10 days of the property owner’s receipt; 
  • specifies that the notice requirement is inapplicable if the property owner and the lessee have agreed in the contract to waive the requirement or have agreed that the lessee will not protest the appraised value of the property;
  • adds subsection (e) that permits the lessee to request the chief appraiser of the appraisal district to send the notice to the appraisal value to the lessee. The chief appraiser is to send the notice to the lessee within 5 days of the date the notice is sent to the property owner if the lessee demonstrates that the lessee is contractually obligated to reimburse the property owner for taxes on the property;
  • adds subsection (f) to make an exception to subsection (e) by providing that a chief appraiser does not have to send the notice requested by the lessee if the appraisal district in which the property is located that is the subject of the notice posts the appraised value of the property on the appraisal district’s Internet website within 5 days of the date the notice is sent to the property owner; and
  • adds subsection (g) to authorize the lessee to designate another person to act as the agent of the lessee for any purpose under this section but requires the designation by lessee be made in the manner provided by Tax Code §1.111, which makes the agent subject to the same authority and same limitations as provided by Tax Code §1.111.

The Governor signed the bill on June 1, 2017, and the bill takes effect on September 1, 2017. The changes in law made by this Act apply only to a notice of appraised value sent to a property owner on or after September 1, 2017.

HB 2228 (Murphy, Jim) amends Tax Code §41.44 as follows:

  • eliminates the two deadlines that existed for single-family residences and for any other property by requiring all notices of protests to be filed before May 15 or not later than 30 days after the notice of appraised value was delivered to the property owner, whichever date is later; and 
  • repeals the provision that allowed property owners of single family residential property to file a notice of protest after June 1 before the appraisal review board approves the appraisal records.

The Governor signed the bill on June 1, 2017, and the bill takes effect on January 1, 2018.

SB 1286 (Bettencourt, Paul) amends Tax Code §41.45 to:

  • require the Comptroller to prescribe by rule the manner and form in which a person must provide a copy of materials to be offered or submitted to the ARB, including security requirements that would allow the ARB to retain the material as part of the board’s hearing records and specifications for the audio visual equipment; and
  • require the appraisal office to provide audiovisual equipment of the same general type, kind, and character, as prescribed by comptroller rule, for use by the property owner or the property owner’s agent if a chief appraiser uses audiovisual equipment at a hearing on a protest. 

The enrolled bill was sent to the Governor on May 28, 2017, and is to take effect on September 1, 2017. The Comptroller is required to adopt rules by January 1, 2018. The changes in law apply only to a protest for which the notice of protest was filed by a property owner with the appraisal review board established for an appraisal district on or after January 1, 2018.

SB 1767 (Buckingham, Dawn) amends Tax Code §41.66(b) to provide that a property owner who is a party to a protest is entitled to elect to present the owner's case at an ARB hearing on the protest either before or after the appraisal district presents the district's case. The bill was sent to the Governor on May 27, 2017, and is to take effect on January 1, 2018. The change in law applies only to a protest for which the notice of protest was filed by a property owner or the designated agent of the owner on or after January 1, 2018.

Chapter 41A – Appeal through Binding Arbitration
SB 731 (Bettencourt, Paul) makes the following changes:

  • amends Tax Code §41A.01 and §41A.03 to expand the eligibility for binding arbitration for ad valorem tax purposes by increasing the appraised or market value, as determined by the ARB’s order, for properties (other than residence homesteads) from $3 million or less to $5 million or less; and 
  • amends Tax Code §41A.03(a) to add a provision that the arbitration deposit is $1,550, if the property does not qualify as the owner’s residence homestead and the appraised or market value, as applicable, of the property is more than $3 million but not more than $5million as determined by the order.

The bill was sent to the Governor on May 28, 2017, and is to take effect on September 1, 2017. The changes apply only to a request for binding arbitration that is filed on or after September 1, 2017

SB 1286 (Bettencourt, Paul) amends Tax Code §41A.061(c) and §41A.07 relating to arbitrators and makes the following changes:

  • requires the Comptroller to remove an arbitrator from the registry of eligible arbitrators if the Comptroller determines by clear and convincing evidence that there is good cause to remove the person from the registry, including evidence of repeated bias or misconduct by the person while acting as an arbitrator;
  • requires the Comptroller, upon receipt of an arbitration request and deposit, to appoint an eligible arbitrator from the Comptroller’s registry list and send notice to the appointed arbitrator requesting the individual to conduct the hearing on the arbitration. [Current provision requires the Comptroller to send a list of qualified arbitrators for selection of the arbitrator by the parties]; 
  • prohibits the Comptroller from appointing an arbitrator if the Comptroller determines that there is good cause not to appoint the arbitrator, including information or evidence indicating repeated bias or misconduct by the person while acting as an arbitrator;
  • provides that to be an eligible arbitrator, the person must reside in the county in which the property that is the subject of the appeal is located. If no available arbitrator on the registry resides in that county the arbitrator must be a resident of Texas; and
  • disqualifies a person as an eligible arbitrator if at any time during the preceding five years, the person has: (1) represented a person for compensation in an ad valorem tax proceeding in the appraisal district in which the property that is the subject of the appeal is located; (2) served as an officer or employee of that appraisal district; or (3) served as a member of the appraisal review board for that appraisal district.

The enrolled bill was sent to the Governor on May 28, 2017, and is to take effect on September 1, 2017. The changes in law apply only to a request for binding arbitration received by the Comptroller from an appraisal district on or after September 1, 2017.

Chapters 312 and 313. Abatement Agreements
SB 277 (Campbell, Donna) amends Chapters 312 and 313, Tax Code, as follows:

  • adds Tax Code §312.0021 to provide as follows: 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 real property or of tangible personal property located on the parcel of real property under a tax abatement agreement 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 bill provides that the prohibition applies regardless of whether the wind-powered energy device is installed or constructed at a location that is in the reinvestment zone but makes an exception by stating that the prohibition does not apply if the wind-powered energy device is installed or constructed as an expansion or repowering of an existing project;
  • amends Tax Code §313.024 to provide that an owner of a parcel of land that is located wholly or partly in a reinvestment zone, a new building constructed on the parcel of land, a new improvement erected or affixed on the parcel of land, or tangible personal property placed in service in the building or improvement or on the parcel of land may not receive a limitation on appraised value for land, building, improvement, or tangible personal property under appraisal value limitation agreement that is entered into on or after September 1, 2017, if, on or after September 1, 2017, a wind-powered energy device is installed or constructed on the same parcel of land at a location that is within 25 nautical miles of the boundaries of a military aviation facility located in this state. The bill provides that the prohibition applies regardless of whether the wind-powered energy device is installed or constructed at a location that is in the reinvestment zone;
  • defines "Military aviation facility" to mean a base, station, fort, or camp at which fixed-wing aviation operations or training is conducted by the U.S. Air Force, the U.S. Air Force Reserve, the U.S. Army, the U.S. Army Reserve, the U.S. Navy, the U.S. Navy Reserve, the U.S. Marine Corps, the U.S. Marine Corps Reserve, the U.S. Coast Guard, the U.S. Coast Guard Reserve, or the Texas National Guard; and
  • defines “wind-powered energy device"  to mean “an apparatus designed or adapted to convert the energy available in the wind into thermal, mechanical, or electrical energy; to store the converted energy, either in the form to which originally converted or another form; or to distribute the converted energy.

The enrolled bill was sent to the Governor on May 30, 2017, and is to take effect on September 1, 2017.

Miscellaneous - Abatement Agreement
HB 1186 (Anderson, Rodney) amends Section 4B, Chapter 628, to authorize the tax assessor-collector for the Dallas County Utility and Reclamation District (district) or a person designated by the tax assessor-collector, to file an application for an exemption on behalf of the property owner if the district has a tax abatement agreement with the owner of single-family residential property to exempt a portion of the taxable value of the property from taxation. The bill provides that all governmental and proprietary actions of the Dallas County Utility and Reclamation District taken before the effective date of this Act are validated, ratified, and confirmed in all respects as if the actions had been taken as authorized by law and the act does not apply to any matter that on the effective date of this Act: (1) is involved in litigation if the litigation ultimately results in the matter being held invalid by a final court judgment; or (2) has been held invalid by a final court judgment. The Governor signed the bill on June 1, 2017, and the bill takes effect on June 1, 2017.