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H.B. 2491

H.B. No. 2491

AN ACT

relating to the administration and collection of ad valorem taxes,
including the transfer of an ad valorem tax lien and a contract for
foreclosure of an ad valorem tax lien; amending, correcting, and
clarifying the Tax Code, Property Code, and Civil Practice and
Remedies Code.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1.07(b), Tax Code, is amended to read as
follows:
(b) The official or agency shall address the notice to the
property owner, the person designated under Section 1.111(f) to
receive the notice for the property owner, if that section applies,
or, if appropriate, the property owner’s agent at the agent’s [his]
address according to the most recent record in the possession of the
official or agency. However, if a property owner files a written
request with the appraisal district that notices be sent to a
particular address, the official or agency shall send the notice to
the address stated in the request.
SECTION 2. Section 1.11(b), Tax Code, is amended to read as
follows:
(b) To be effective, a [A] request made under [pursuant to]
this section must be filed with the appraisal district. A request
remains in effect until revoked by a written revocation filed with
the appraisal district by the owner.
SECTION 3. Section 11.43, Tax Code, is amended by adding
Subsections (l) and (m) to read as follows:
(l) The form for an application under Section 11.13 must
include a space for the applicant to state the applicant’s date of
birth. Failure to provide the date of birth does not affect the
applicant’s eligibility for an exemption under that section, other
than an exemption under Section 11.13(c) or (d) for an individual 65
years of age or older.
(m) Notwithstanding Subsections (a) and (k), a person who
receives an exemption under Section 11.13, other than an exemption
under Section 11.13(c) or (d) for an individual 65 years of age or
older, in a tax year is entitled to receive an exemption under
Section 11.13(c) or (d) for an individual 65 years of age or older
in the next tax year on the same property without applying for the
exemption if the person becomes 65 years of age in that next year as
shown by information in the records of the appraisal district that
was provided to the appraisal district by the individual in an
application for an exemption under Section 11.13 on the property or
in correspondence relating to the property. This subsection does
not apply if the chief appraiser determines that the individual is
no longer entitled to any exemption under Section 11.13 on the
property.
SECTION 4. Section 22.28, Tax Code, is amended by amending
Subsection (b) and adding Subsection (c) to read as follows:
(b) The chief appraiser shall certify to the assessor for
each taxing unit participating in the appraisal district that
imposes taxes on the property that the chief appraiser has imposed
[may retain a portion of] a penalty [collected] under this
section[, not to exceed 20 percent of the amount of the penalty, to
cover the chief appraiser’s costs of collecting the penalty]. The
assessor [chief appraiser] shall add the amount of the penalty to
the original amount of tax imposed on the property and shall include
that amount in the tax bill for that year. The penalty becomes part
of the tax on the property and is secured by the tax lien that
attaches to the property under Section 32.01 [distribute the
remainder of the penalty to each taxing unit participating in the
appraisal district that imposes taxes on the property in proportion
to the taxing unit’s share of the total amount of taxes imposed on
the property by all taxing units participating in the district].
(c) To help defray the costs of administering this chapter,
a collector who collects a penalty imposed under Subsection (a)
shall remit to the appraisal district that employs the chief
appraiser who imposed the penalty an amount equal to five percent of
the penalty amount collected.
SECTION 5. Subchapter B, Chapter 23, Tax Code, is amended by
adding Section 23.225 to read as follows:
Sec. 23.225. APPRAISAL OF LAND INCLUDED IN HABITAT PRESERVE
AND SUBJECT TO CONSERVATION EASEMENT. (a) In this section,
“endangered species,” “federal permit,” and “habitat preserve”
have the meanings assigned by Section 83.011, Parks and Wildlife
Code.
(b) In appraising land that is included in a habitat
preserve and is subject to a conservation easement created under
Chapter 183, Natural Resources Code, or other law that restricts
the use of the land to protect an endangered species under a federal
permit, the chief appraiser shall consider the effect of the
restriction on the value of the land.
SECTION 6. Section 23.51(3), Tax Code, is amended to read as
follows:
(3) “Category” means the value classification of land
considering the agricultural use to which the land is principally
devoted. The chief appraiser shall determine the categories into
which land in the appraisal district is classified. In classifying
land according to categories, the chief appraiser shall distinguish
between [Categories of land may include but are not limited to]
irrigated cropland, dry cropland, improved pasture, native
pasture, orchard, and waste. The chief appraiser may establish
additional categories. The chief appraiser shall [and may be]
further divide each category [divided] according to soil type, soil
capability, irrigation, general topography, geographical factors,
and other factors that [which] influence the productive capacity of
the category. The chief appraiser shall obtain information from
the Texas Agricultural [Agriculture] Extension Service, the
Natural Resources [Soil] Conservation Service of the United States
Department of Agriculture, and other recognized agricultural
sources for the purposes of determining the categories of land
[production] existing in the appraisal district.
SECTION 7. Section 25.25(d), Tax Code, is amended to read as
follows:
(d) At any time prior to the date the taxes become
delinquent, a property owner or the chief appraiser may file a
motion with the appraisal review board to change the appraisal roll
to correct an error that resulted in an incorrect appraised value
for the owner’s property. However, the error may not be corrected
unless it resulted in an appraised value that exceeds by more than
one-third the correct appraised value. If the appraisal roll is
changed under this subsection, the property owner must pay to each
affected taxing unit a late-correction penalty equal to 10 percent
of the amount of taxes as calculated on the basis of the corrected
appraised value. Payment of the late-correction penalty is secured
by the lien that attaches to the property under Section 32.01 and is
subject to enforced collection under Chapter 33. The roll may not be
changed under this subsection if:
(1) the property was the subject of a protest brought
by the property owner under Chapter 41, a hearing on the protest was
conducted in which the property owner offered evidence or argument,
and the appraisal review board made a determination of the protest
on the merits; or
(2) the appraised value of the property was
established as a result of a written agreement between the property
owner or the owner’s agent and the appraisal district.
SECTION 8. Section 26.11(c), Tax Code, is amended to read as
follows:
(c) If the amount of prorated taxes determined to be due as
provided by this section is tendered to the collector for the unit,
the collector [he] shall accept the tender. The payment absolves:
(1) the transferor of liability for taxes by the unit
on the property for the year of the transfer; and
(2) the taxing unit of liability for a refund in
connection with taxes on the property for the year of the transfer.
SECTION 9. Section 31.05(a), Tax Code, is amended to read as
follows:
(a) The governing body of a taxing unit [that collects its
own taxes] may adopt the discounts provided by Subsection (b) or
Subsection (c) [of this section], or both, in the manner required by
law for official action by the body. The discounts, if adopted,
apply only to that taxing unit’s taxes [for a taxing unit for which
the adopting taxing unit collects taxes if the governing body of the
other unit, in the manner required by law for official action by the
body, adopts the discounts or approves of their application to its
taxes by the collecting unit]. If a taxing unit adopts both
discounts under Subsections (b) and (c) [of this section], the
discounts adopted under Subsection (b) apply unless the [unit mails
its] tax bills for the unit are mailed after September 30, in which
case only the discounts under Subsection (c) apply. A taxing unit
that collects taxes for another taxing unit that adopts the
discounts may prepare and mail separate tax bills on behalf of the
adopting taxing unit and may charge an additional fee for preparing
and mailing the separate tax bills and for collecting the taxes
imposed by the adopting taxing unit. If under an intergovernmental
contract a county assessor-collector collects taxes for a taxing
unit that adopts the discounts, the county assessor-collector may
terminate the contract if the county has adopted a discount policy
that is different from the discount policy adopted by the adopting
taxing unit.
SECTION 10. Section 31.073, Tax Code, is amended to read as
follows:
Sec. 31.073. RESTRICTED OR CONDITIONAL PAYMENTS
PROHIBITED. A restriction or condition placed on a check in payment
of taxes, penalties, or interest by the maker that limits the amount
of taxes, penalties, or interest owed to an amount less than that
stated in the tax bill or shown by the tax collector’s records is
void unless the restriction or condition is authorized by this
code.
SECTION 11. Section 31.08(a), Tax Code, is amended to read
as follows:
(a) At the request of any person, a collector for a taxing
unit shall issue a certificate showing the amount of delinquent
taxes, penalties, [and] interest, and any known costs and expenses
under Section 33.48 due the unit on a property according to the
unit’s current tax records. If the collector collects taxes for
more than one taxing unit, the certificate must show the amount of
delinquent taxes, penalties, [and] interest, and any known costs
and expenses under Section 33.48 due on the property to each taxing
unit for which the collector collects the taxes. The collector
shall charge a fee not to exceed $10 for each certificate issued.
The collector shall pay all fees collected under this section into
the treasury of the taxing unit that employs the collector [him].
SECTION 12. Section 32.05, Tax Code, is amended by amending
Subsections (b) and (c) and adding Subsections (b-1), (d), and (e)
to read as follows:
(b) Except as provided by Subsection (c)(1) [(c) of this
section], a tax lien provided by this chapter takes priority over:
(1) the claim of any creditor of a person whose
property is encumbered by the lien;
(2) [and over] the claim of any holder of a lien on
property encumbered by the tax lien, including any lien held by a
property owners’ association, homeowners’ association, condominium
unit owners’ association, or council of owners of a condominium
regime under a restrictive covenant, condominium declaration,
master deed, or other similar instrument that secures regular or
special maintenance assessments, fees, dues, interest, fines,
costs, attorney’s fees, or other monetary charges against the
property; and
(3) any right of remainder, right or possibility of
reverter, or other future interest in, or encumbrance against, the
property, whether vested or contingent [not the debt or lien
existed before attachment of the tax lien].
(b-1) The priority given to a tax lien by Subsection (b)
prevails, regardless of whether the debt, lien, future interest, or
other encumbrance existed before attachment of the tax lien.
(c) A tax lien provided by this chapter is inferior to [a
claim]:
(1) a claim for any survivor’s allowance, funeral
expenses, or expenses of the last illness of a decedent made against
the estate of a decedent as provided by law;
(2) except as provided by Subsection (b)(2), [under] a
recorded restrictive covenant that runs [running] with the land
and was[, other than a restrictive covenant in favor of a property
owners’ association or homeowners’ association] recorded before
January 1 of the year the tax lien arose; or
(3) [under] a valid easement of record recorded before
January 1 of the year the tax lien arose.
(d) In an action brought under Chapter 33 for the enforced
collection of a delinquent tax against property, a property owners’
association, homeowners’ association, condominium unit owners’
association, or council of owners of a condominium regime that
holds a lien for regular or special maintenance assessments, fees,
dues, interest, fines, costs, attorney’s fees, or other monetary
charges against the property is not a necessary party to the action
unless, at the time the action is commenced, notice of the lien in a
liquidated amount is evidenced by a sworn instrument duly executed
by an authorized person and recorded with the clerk of the county in
which the property is located. A tax sale of the property
extinguishes the lien held by a property owners’ association,
homeowners’ association, condominium unit owners’ association, or
council of owners of a condominium regime for all amounts that
accrued before the date of sale if:
(1) the holder of the lien is joined as a party to an
action brought under Chapter 33 by virtue of a notice of the lien on
record at the time the action is commenced; or
(2) the notice of lien is not of record at the time the
action is commenced, regardless of whether the holder of the lien is
made a party to the action.
(e) The existence of a recorded restrictive covenant,
declaration, or master deed that generally provides for the lien
held by a property owners’ association, homeowners’ association,
condominium unit owners’ association, or council of owners of a
condominium regime does not, by itself, constitute actual or
constructive notice to a taxing unit of a lien under Subsection (d).
SECTION 13. Section 32.06, Tax Code, is amended to read as
follows:
Sec. 32.06. TRANSFER OF TAX LIEN. (a) In this section:
(1) “Mortgage servicer” has the meaning assigned by
Section 51.0001, Property Code.
(2) “Transferee” means a person authorized to pay the
taxes of another.
(a-1) A person may authorize another person to pay the
delinquent taxes imposed by a taxing unit on the person’s real
property by filing with the collector for the unit a sworn document
stating:
(1) the authorization;
(2) the name and street address of the transferee[,
naming the other person] authorized to pay the taxes of the property
owner; and
(3) a description of[, and describing] the property by
street address, if applicable, and legal description.
(a-2) After a tax lien is transferred, taxes on the property
that become due in subsequent tax years may be transferred before
the delinquency date in the manner provided by Subsection (a-1).
(a-3) A tax lien may be transferred before the delinquency
date in the manner provided by Subsection (a-1) only if the real
property is not subject to a lien other than the tax lien.
(b) If a transferee [person] authorized to pay a property
owner’s [another’s] taxes pursuant to Subsection (a-1) [(a)] pays
the taxes and any penalties and interest imposed, the collector
shall issue a tax receipt to that transferee [the person paying the
taxes]. In addition, the collector or a person designated by the
collector shall certify on the sworn document that payment of the
taxes and any penalties and interest on the described property and
collection costs has been made by the transferee on behalf of the
property owner [a person other than the person] liable for the taxes
when imposed and that the taxing unit’s tax lien is transferred to
that transferee [the person paying the taxes]. The collector shall
attach to the sworn document the collector’s seal of office or sign
the document before a notary public and deliver the sworn document,
a tax receipt, and the affidavit attesting to the transfer of the
tax lien to the transferee within 30 days [person paying the taxes].
The sworn document, tax receipt, and affidavit attesting to the
transfer of the tax lien may be combined into one document. The
collector shall conspicuously identify in the applicable
taxpayer’s account the date of the transfer of a tax lien
transferred under this section [keep a record of all tax liens
transferred as provided by this section].
(c) Except as otherwise provided by this section, the
transferee of a tax lien and any successor in interest is entitled
to foreclose the lien:
(1) in the manner provided by law for foreclosure of
tax liens; or
(2) in the manner specified in Section 51.002,
Property Code, and Section 32.065 of this code, if the property
owner and the transferee enter into a contract that is secured by a
lien on the property.
(d) To be enforceable, a tax lien transferred as provided by
this section must be recorded with the sworn statement and
affidavit attesting to the transfer of the tax lien as described in
Subsection (b) in the deed records of each county in which the
property encumbered by the lien is located.
(e) A transferee [person] holding a tax lien transferred as
provided by this section may not charge a greater rate of interest
than 18 percent a year on the funds advanced. Funds advanced are
limited to the taxes, penalties, interest, and collection costs
paid as shown on the tax receipt, expenses paid to record the lien,
plus reasonable closing costs [recording expenses paid to acquire
and record the lien].
(f) The mortgage servicer [holder] of a preexisting lien on
property encumbered by a tax lien transferred as provided by
Subsection (b) [this section] is entitled, within six months after
the date on which the tax lien is recorded in all counties in which
the property is located, to obtain a release of the transferred tax
lien by paying [pay] the transferee [holder] of the tax lien the
amount owed under the contract between the property owner and the
transferee. A transferee may charge a reasonable fee for a payoff
statement that is requested after an initial payoff statement is
provided.
(g) At any time after the end of the six-month period
specified by Subsection (f) and before a notice of foreclosure of
the transferred tax lien is sent, the transferee of the tax lien or
the holder of the tax lien may require the property owner to provide
written authorization and pay a reasonable fee before providing
information regarding the current balance owed by the property
owner to the transferee or the holder of the tax lien.
(h) A mortgage servicer who pays a transferred tax lien
[paid for the lien, plus interest accrued at the rate provided by
Subsection (e) and recording expenses, and] becomes subrogated to
all rights in the lien.
(i) [(g)] A foreclosure of [suit to foreclose] a tax lien
transferred as provided by this section may not be instituted
within one year from the date on which the lien is recorded in all
counties in which the property is located, unless the contract
between the owner of the property and the transferee provides
otherwise.
(j) [(h)] After one year from the date on which a tax lien
transferred as provided by this section is recorded in all counties
in which the property is located, the transferee [holder] of the
lien may [file suit to] foreclose the lien in the manner provided by
Subsection (c) unless a contract between the holder of the lien and
the owner of the property encumbered by the lien provides
otherwise. If a foreclosure [the] suit results in foreclosure of
the lien, the transferee [person filing suit] is entitled to
recover attorney’s fees in an amount not to exceed 10 percent of the
judgment. The proceeds of a sale following a judicial foreclosure
as provided by this subsection shall be applied first to the payment
of court costs, then to payment of the judgment, including accrued
interest, and then to the payment of any attorney’s fees fixed in
the judgment. Any remaining proceeds shall be paid to other holders
of liens on the property in the order of their priority and then to
the person whose property was sold at the tax sale.
(k) Beginning on the date the foreclosure deed is recorded,
the [(i) The] person whose property is sold as provided by
Subsection (c) [this section] or the mortgage servicer of [any
person holding] a prior recorded [first] lien against the property
is entitled[, within one year after the date the property is sold,]
to redeem the foreclosed property from the purchaser [at the tax
sale] by paying the [that] purchaser or successor 125 [the tax sale
purchase price, plus costs, and interest accrued on the judgment to
the date of redemption or 118] percent of the purchase price during
the first year of the redemption period or 150 percent of the
purchase price during the second year of the redemption period with
cash or cash equivalent funds. The right of redemption may be
exercised on or before the second anniversary of the date on which
the purchaser’s deed is filed of record if the property sold was the
residence homestead of the owner, was land designated for
agricultural use, or was a mineral interest. For any other
property, the right of redemption must be exercised not later than
the 180th day after the date on which the purchaser’s deed is filed
of record [amount of the judgment, whichever is less]. If a person
redeems the property as provided by this subsection, the purchaser
at the tax sale shall deliver a deed to the property to the person
redeeming the property. If the person who owned the property at the
time of foreclosure redeems the property, all liens existing on the
property at the time of the tax sale remain in effect to the extent
not paid from the sale proceeds.
SECTION 14. Section 32.065, Tax Code, is amended by
amending Subsections (a), (b), (c), (d), and (f) and adding
Subsections (b-1) and (g) to read as follows:
(a) Section 32.06 does not abridge the right of an owner of
real property to enter into a contract for the payment of taxes
[with the holder of a lien on the property, including a transferee
under Section 32.06 or this section, or affect a contract between
the owner and holder of a lien for the payment of taxes on the
property].
(b) Notwithstanding any agreement to the contrary, a [A]
contract entered into under Subsection (a) between a transferee and
the property owner under Section 32.06 that is secured by a priority
lien on the property shall [may] provide for a power of sale and
foreclosure under Chapter 51, Property Code, and:
(1) an event of default; [and]
(2) notice of acceleration;
(3) recording of the contract in each county in which
the property is located;
(4) recording of the sworn document and affidavit
attesting to the transfer of the tax lien;
(5) requiring the transferee to serve foreclosure
notices on the property owner at the property owner’s last known
address in the manner required by Sections 51.002(b), (d), and (e),
Property Code, or by a commercially reasonable delivery service
that maintains verifiable records of deliveries for at least five
years from the date of delivery; and
(6) requiring, at the time the foreclosure notices
required by Subdivision (5) are served on the property owner, the
transferee to serve a copy of the notice of sale in the same manner
on the mortgage servicer or the holder of all recorded real property
liens encumbering the property that includes on the first page, in
14-point boldfaced type or 14-point uppercase typewritten letters,
a statement that reads substantially as follows:

“PURSUANT TO TEXAS TAX CODE SECTION 32.06, THE FORECLOSURE SALE
REFERRED TO IN THIS DOCUMENT IS A SUPERIOR TRANSFER TAX LIEN SUBJECT
TO RIGHT OF REDEMPTION UNDER CERTAIN CONDITIONS. THE FORECLOSURE
IS SCHEDULED TO OCCUR ON THE (DATE).”
(b-1) On an event of default and notice of acceleration, the
mortgage servicer of a recorded lien encumbering real property may
obtain a release of a transferred tax lien on the property by paying
the transferee of the tax lien or the holder of the tax lien the
amount owed by the property owner to that transferee or holder.
(c) Notwithstanding any other provision of this code, a
transferee of a tax lien is subrogated to and is entitled to
exercise any right or remedy possessed by the transferring taxing
unit, including or related to foreclosure or judicial sale, but is
prohibited from exercising a remedy of foreclosure or judicial sale
where the transferring taxing unit would be prohibited from
foreclosure or judicial sale.
(d) Chapters 342 and 346, Finance Code, [and Section
302.102, Finance Code,] do not apply to a transaction covered by
this section. The transferee of a tax lien under this section is
not required to obtain a license under Title 4, Finance Code.
(f) Before accepting an application fee or executing a
contract, the transferee shall disclose [The first written
communication by the lender] to the transferee’s [its] prospective
borrower each type and [shall disclose] the amount [types] of
possible additional charges or fees that may be incurred by the
borrower in connection with the loan or contract under this
section.
(g) An affidavit of the transferee executed after
foreclosure of a tax lien that recites compliance with the terms of
Section 32.06 and this section and is recorded in each county in
which the property is located:
(1) is prima facie evidence of compliance with Section
32.06 and this section; and
(2) may be relied on conclusively by a bona fide
purchaser for value without notice of any failure to comply.
SECTION 15. Sections 33.011(a) and (d), Tax Code, are
amended to read as follows:
(a) The governing body of a taxing unit:
(1) shall waive penalties and may provide for the
waiver of interest on a delinquent tax if an act or omission of an
officer, employee, or agent of the taxing unit or the appraisal
district in which the taxing unit participates caused or resulted
in the taxpayer’s failure to pay the tax before delinquency and if
the tax is paid not later than the 21st day after the date the
taxpayer knows or should know of the delinquency; and
(2) may waive penalties and provide for the waiver of
interest on a delinquent tax if:
(A) the property for which the tax is owed is
acquired by a religious organization; and
(B) [that qualifies the property for exemption
under Section 11.20] before the first anniversary of the date the
religious organization acquires the property, the organization
pays the tax and qualifies the property for an exemption under
Section 11.20 as evidenced by the approval of the exemption by the
chief appraiser under Section 11.45.
(d) A request for a waiver of penalties and interest under
Subsection (a)(1), (b), or (h) [this section] must be made before
the 181st day after the delinquency date. A request for a waiver of
penalties and interest under Subsection (a)(2) must be made before
the first anniversary of the date the religious organization
acquires the property. To be valid, a waiver of penalties or
interest under this section must be requested in writing. If a
written request for a waiver is not timely made, the governing body
of a taxing unit may not waive any penalties or interest under this
section.
SECTION 16. Section 33.02(a), Tax Code, is amended to read
as follows:
(a) The collector for a taxing unit [that collects its own
taxes] may enter an agreement with a person delinquent in the
payment of the tax for payment of the tax, penalties, and interest
in installments. The agreement must be in writing and may not
extend for a period of more than 36 months.
SECTION 17. Section 33.22, Tax Code, is amended by adding
Subsections (d) and (e) to read as follows:
(d) A collector is entitled to recover attorney’s fees in an
amount equal to the compensation specified in the contract with the
attorney if:
(1) recovery of the attorney’s fees is requested in the
application for the tax warrant;
(2) the taxing unit served by the collector contracts
with an attorney under Section 6.30;
(3) the existence of the contract and the amount of
attorney’s fees that equals the compensation specified in the
contract are supported by the affidavit of the collector; and
(4) the tax sought to be recovered is not subject to
the additional penalty under Section 33.07 or 33.08 at the time the
application is filed.
(e) If a taxing unit is represented by an attorney who is
also an officer or employee of the taxing unit, the collector for
the taxing unit is entitled to recover attorney’s fees in an amount
equal to 15 percent of the total amount of delinquent taxes,
penalties, and interest that the property owner owes the taxing
unit.
SECTION 18. Subchapter A, Chapter 33, Tax Code, is amended
by adding Section 33.045 to read as follows:
Sec. 33.045. NOTICE OF PROVISIONS AUTHORIZING DEFERRAL OR
ABATEMENT. (a) A tax bill mailed by an assessor or collector under
Section 31.01 and any written communication delivered to a property
owner by an assessor or collector for a taxing unit or an attorney
or other agent of a taxing unit that specifically threatens a
lawsuit to collect a delinquent tax shall contain the following
explanation in capital letters: “IF YOU ARE 65 YEARS OF AGE OR
OLDER OR ARE DISABLED AND THE PROPERTY DESCRIBED IN THIS DOCUMENT IS
YOUR RESIDENCE HOMESTEAD, YOU SHOULD CONTACT THE APPRAISAL DISTRICT
REGARDING ANY ENTITLEMENT YOU MAY HAVE TO A POSTPONEMENT IN THE
PAYMENT OF THESE TAXES”.
(b) This section does not apply to a communication that
relates to taxes that are the subject of pending litigation.
SECTION 19. Subchapter A, Chapter 33, Tax Code, is amended
by adding Section 33.11 to read as follows:
Sec. 33.11. EARLY ADDITIONAL PENALTY FOR COLLECTION COSTS
FOR TAXES IMPOSED ON PERSONAL PROPERTY. (a) In order to defray
costs of collection, the governing body of a taxing unit or
appraisal district in the manner required by law for official
action may provide that taxes imposed on tangible personal property
that become delinquent on or after February 1 of a year incur an
additional penalty on a date that occurs before July 1 of the year
in which the taxes become delinquent if:
(1) the taxing unit or appraisal district or another
unit that collects taxes for the unit has contracted with an
attorney under Section 6.30; and
(2) the taxes on the personal property become subject
to the attorney’s contract before July 1 of the year in which the
taxes become delinquent.
(b) A penalty imposed under Subsection (a) is incurred by
the delinquent taxes on the later of:
(1) the date those taxes become subject to the
attorney’s contract; or
(2) 60 days after the date the taxes become
delinquent.
(c) The amount of the penalty may not exceed the amount of
the compensation specified in the contract with the attorney to be
paid in connection with the collection of the delinquent taxes.
(d) A tax lien attaches to the property on which the tax is
imposed to secure payment of the penalty.
(e) If a penalty is provided under this section, a taxing
unit or appraisal district may not:
(1) recover attorney’s fees in a suit to collect
delinquent taxes subject to the penalty; or
(2) impose an additional penalty under Section 33.07
on a delinquent personal property tax.
(f) If the governing body of a taxing unit or appraisal
district provides for a penalty under this section, the collector
for the taxing unit or appraisal district shall send a notice of the
penalty to the property owner. The notice shall state the date on
which the penalty is incurred, and the tax collector shall deliver
the notice at least 30 and not more than 60 days before that date.
If the amount of personal property tax, penalty and interest owed to
all taxing units for which the tax collector collects exceeds
$10,000 on a single account identified by a unique property
identification number, the notice regarding that account must be
delivered by certified mail, return receipt requested. All other
notices under this section may be delivered by regular first-class
mail.
(g) The authority granted to taxing units and appraisal
districts under this section is to be construed as an alternative,
with regards to delinquent personal property taxes, to the
authority given by Section 33.07.
SECTION 20. Section 33.23(a), Tax Code, is amended to read
as follows:
(a) A tax warrant shall direct a peace officer in the county
and the collector to seize as much of the person’s personal property
as may be reasonably necessary for the payment of all taxes,
penalties, [and] interest, and attorney’s fees included in the
application and all costs of seizure and sale. The warrant shall
direct the person whose property is seized to disclose to the
officer executing the warrant the name and the address if known of
any other person having an interest in the property.
SECTION 21. Section 33.25, Tax Code, is amended by amending
Subsections (f) and (h) and adding Subsection (i) to read as
follows:
(f) The proceeds of a sale of property under this section
shall be applied to:
(1) any compensation owed to or any expense advanced
by the licensed auctioneer under an agreement entered into under
Subsection (b) or a service provider under an agreement entered
into under Subsection (c);
(2) all usual costs, expenses, and fees of the seizure
and sale, payable to the peace officer conducting the sale;
(3) all additional expenses incurred in advertising
the sale or in removing, storing, preserving, or safeguarding the
seized property pending its sale;
(4) all usual court costs payable to the clerk of the
court that issued the tax warrant; and
(5) taxes, penalties, [and] interest, and attorney’s
fees included in the application for warrant.
(h) After a seizure of personal property defined by Sections
33.21(d)(2)-(5), the collector shall apply the seized property
toward the payment of the taxes, penalties, [and] interest, and
attorney’s fees included in the application for warrant and all
costs of the seizure as required by Subsection (f).
(i) After a tax warrant is issued, the seizure or sale of the
property may be canceled and terminated at any time by the applicant
or an authorized agent or attorney of the applicant.
SECTION 22. Section 33.48, Tax Code, is amended by adding
Subsection (d) to read as follows:
(d) A collector who accepts a payment of the court costs and
other expenses described by this section shall disburse the amount
of the payment as follows:
(1) amounts owing under Subsections (a)(1), (2), (3),
and (6) are payable to the clerk of the court in which the suit is
pending; and
(2) expenses described by Subsection (a)(4) are
payable to the general fund of the taxing unit or to the person or
entity who advanced the expense.
SECTION 23. Section 33.51, Tax Code, is amended to read as
follows:
Sec. 33.51. WRIT OF POSSESSION. (a) If the court orders
the foreclosure of a tax lien and the sale of real property, the
judgment shall provide for the issuance by the clerk of said court
of a writ of possession to the purchaser at the sale or to the
purchaser’s assigns no sooner than 20 days following the date on
which the purchaser’s deed from the sheriff or constable is filed of
record.
(b) The officer charged with executing the writ shall place
the purchaser or the purchaser’s assigns in possession of the
property described in the purchaser’s deed without further order
from any court and in the manner provided by the writ, subject to
any notice to vacate that may be required to be given to a tenant
under Section 24.005(b), Property Code.
(c) The writ of possession shall order the officer executing
the writ to:
(1) post a written warning that is at least 8-1/2 by 11
inches on the exterior of the front door of the premises notifying
the occupant that the writ has been issued and that the writ will be
executed on or after a specific date and time stated in the warning
that is not sooner than the 10th day after the date the warning is
posted; and
(2) on execution of the writ:
(A) deliver possession of the premises to the
purchaser or the purchaser’s assigns;
(B) instruct the occupants to immediately leave
the premises and, if the occupants fail or refuse to comply,
physically remove them from the premises;
(C) instruct the occupants to remove, or to allow
the purchaser or purchaser’s assigns, representatives, or other
persons acting under the officer’s supervision to remove, all
personal property from the premises; and
(D) place, or have an authorized person place,
the removed personal property outside the premises at a nearby
location, but not so as to block a public sidewalk, passageway, or
street and not while it is raining, sleeting, or snowing.
(d) The writ of possession shall authorize the officer, at
the officer’s discretion, to engage the services of a bonded or
insured warehouseman to remove and store, subject to applicable
law, all or part of the personal property at no cost to the
purchaser, the purchaser’s assigns, or the officer executing the
writ. The officer may not require the purchaser or the purchaser’s
assigns to store the personal property.
(e) The writ of possession shall contain notice to the
officer that under Section 7.003, Civil Practice and Remedies Code,
the officer is not liable for damages resulting from the execution
of the writ if the officer executes the writ in good faith and with
reasonable diligence.
(f) The warehouseman’s lien on stored property, the
officer’s duties, and the occupants’ rights of redemption as
provided by Section 24.0062, Property Code, are all applicable with
respect to any personal property that is removed under Subsection
(d).
(g) A sheriff or constable may use reasonable force in
executing a writ under this section.
(h) If a taxing unit is a purchaser and is entitled to a writ
of possession in the taxing unit’s name:
(1) a bond may not be required of the taxing unit for
issuance or delivery of a writ of possession; and
(2) a fee or court cost may not be charged for issuance
or delivery of a writ of possession.
(i) In this section:
(1) “Premises” means all of the property described in
the purchaser’s deed, including the buildings, dwellings, or other
structures located on the property.
(2) “Purchaser” includes a taxing unit to which
property is bid off under Section 34.01(j).
SECTION 24. Subchapter C, Chapter 33, Tax Code, is amended
by adding Section 33.57 to read as follows:
Sec. 33.57. ALTERNATIVE NOTICE OF TAX FORECLOSURE ON
CERTAIN PARCELS OF REAL PROPERTY. (a) In this section, “appraised
value” means the appraised value according to the most recent
appraisal roll approved by the appraisal review board.
(b) This section may be invoked and used by one or more
taxing units if there are delinquent taxes, penalties, interest,
and attorney’s fees owing to a taxing unit on a parcel of real
property, and:
(1) the total amount of delinquent taxes, penalties,
interest, and attorney’s fees owed exceeds the appraised value of
the parcel; or
(2) there are 10 or more years for which delinquent
taxes are owed on the parcel.
(c) One or more taxing units may file a single petition for
foreclosure under this section that includes multiple parcels of
property and multiple owners. Alternatively, separate petitions
may be filed and docketed separately for each parcel of property.
Another taxing unit with a tax claim against the same parcel may
intervene in an action for the purpose of establishing and
foreclosing its tax lien without further notice to a defendant. The
petition must be filed in the county in which the tax was imposed
and is sufficient if it is in substantially the form prescribed by
Section 33.43 and further alleges that:
(1) the amount owed in delinquent taxes, penalties,
interest, and attorney’s fees exceeds the appraised value of the
parcel; or
(2) there are 10 or more years for which delinquent
taxes are owed on the parcel.
(d) Simultaneously with the filing of the petition under
this section, a taxing unit shall also file a motion with the court
seeking an order approving notice of the petition to each defendant
by certified mail in lieu of citation and, if the amount of
delinquent taxes, penalties, interest, and attorney’s fees alleged
to be owed exceeds the appraised value of the parcel, waiving the
appointment of an attorney ad litem. The motion must be supported
by certified copies of tax records that show the tax years for which
delinquent taxes are owed, the amounts of delinquent taxes,
penalties, interest, and attorney’s fees, and, if appropriate, the
appraised value of the parcel.
(e) The court shall approve a motion under Subsection (d) if
the documents in support of the motion show that:
(1) the amount of delinquent taxes, penalties,
interest, and attorney’s fees that are owed exceeds the appraised
value of the parcel; or
(2) there are 10 or more years for which delinquent
taxes are owed on the parcel.
(f) Before filing a petition under this section, or as soon
afterwards as practicable, the taxing unit or its attorney shall
determine the address of each owner of a property interest in the
parcel for the purpose of providing notice of the pending petition.
If the title search, the taxing unit’s tax records, and the
appraisal district records do not disclose an address of a person
with a property interest, consulting the following sources of
information is to be considered a reasonable effort by the taxing
unit or its attorney to determine the address of a person with a
property interest in the parcel subject to foreclosure:
(1) telephone directories, electronic or otherwise,
that cover:
(A) the area of any last known address for the
person; and
(B) the county in which the parcel is located;
(2) voter registration records in the county in which
the parcel is located; and
(3) where applicable, assumed name records maintained
by the county clerk of the county in which the parcel is located and
corporate records maintained by the secretary of state.
(g) Not later than the 45th day before the date on which a
hearing on the merits on a taxing unit’s petition is scheduled, the
taxing unit or its attorney shall send a copy of the petition and a
notice by certified mail to each person whose address is determined
under Subsection (f), informing the person of the pending
foreclosure action and the scheduled hearing. A copy of each notice
shall be filed with the clerk of the court together with an
affidavit by the tax collector or by the taxing unit’s attorney
attesting to the fact and date of mailing of the notice.
(h) In addition to the notice required by Subsection (g),
the taxing unit shall provide notice by publication and by posting
to all persons with a property interest in the parcel subject to
foreclosure. The notice shall be published in the English language
once a week for two weeks in a newspaper that is published in the
county in which the parcel is located and that has been in general
circulation for at least one year immediately before the date of the
first publication, with the first publication to be not less than
the 45th day before the date on which the taxing unit’s petition is
scheduled to be heard. When returned and filed in the trial court,
an affidavit of the editor or publisher of the newspaper attesting
to the date of publication, together with a printed copy of the
notice as published, is sufficient proof of publication under this
subsection. If a newspaper is not published in the county in which
the parcel is located, publication in an otherwise qualifying
newspaper published in an adjoining county is sufficient. The
maximum fee for publishing the citation shall be the lowest
published word or line rate of that newspaper for classified
advertising. The notice by posting shall be in the English language
and given by posting a copy of the notice at the courthouse door of
the county in which the foreclosure is pending not less than the
45th day before the date on which the taxing unit’s petition is
scheduled to be heard. Proof of the posting of the notice shall be
made by affidavit of the attorney for the taxing unit, or of the
person posting it. If the publication of the notice cannot be had
for the maximum fee established in this subsection, and that fact is
supported by the affidavit of the attorney for the taxing unit, the
notice by posting under this subsection is sufficient.
(i) The notice required by Subsections (g) and (h) must
include:
(1) a statement that foreclosure proceedings have been
commenced and the date the petition was filed;
(2) a legal description, tax account number, and, if
known, a street address for the parcel in which the addressee owns a
property interest;
(3) the name of the person to whom the notice is
addressed and the name of each other person who, according to the
title search, has an interest in the parcel in which the addressee
owns a property interest;
(4) the date, time, and place of the scheduled hearing
on the petition;
(5) a statement that the recipient of the notice may
lose whatever property interest the recipient owns in the parcel as
a result of the hearing and any subsequent tax sale;
(6) a statement explaining how a person may contest
the taxing unit’s petition as provided by Subsection (j) and that a
person’s interest in the parcel may be preserved by paying all
delinquent taxes, penalties, interest, attorney’s fees, and court
costs before the date of the scheduled hearing on the petition;
(7) the name, address, and telephone number of the
taxing unit and the taxing unit’s attorney of record; and
(8) the name of each other taxing unit that imposes
taxes on the parcel, together with a notice that any taxing unit may
intervene without further notice and set up its claims for
delinquent taxes.
(j) A person claiming a property interest in a parcel
subject to foreclosure may contest a taxing unit’s petition by
filing with the clerk of the court a written response to the
petition not later than the seventh day before the date scheduled
for hearing on the petition and specifying in the response any
affirmative defense of the person. A copy of the response must be
served on the taxing unit’s attorney of record in the manner
required by Rule 21a, Texas Rules of Civil Procedure. The taxing
unit is entitled on request to a continuance of the hearing if a
written response filed to a notice of the hearing contains an
affirmative defense or requests affirmative relief against the
taxing unit.
(k) Before entry of a judgment under this section, a taxing
unit may remove a parcel erroneously included in the petition and
may take a voluntary nonsuit as to one or more parcels of property
without prejudicing its action against the remaining parcels.
(l) If before the hearing on a taxing unit’s petition the
taxing unit discovers a deficiency in the provision of notice under
this section, the taxing unit shall take reasonable steps in good
faith to correct the deficiency before the hearing. A notice
provided by Subsections (g)-(i) is in lieu of citation issued and
served under Rule 117a, Texas Rules of Civil Procedure. Regardless
of the manner in which notice under this section is given, an
attorney ad litem may not be appointed for a person with an interest
in a parcel with delinquent taxes, penalties, interest, and
attorney’s fees against the parcel in an amount that exceeds the
parcel’s appraised value. To the extent of any additional conflict
between this section and the Texas Rules of Civil Procedure, this
section controls. Except as otherwise provided by this section, a
suit brought under this section is governed generally by the Texas
Rules of Civil Procedure and by Subchapters C and D of this chapter.
(m) A judgment in favor of a taxing unit under this section
must be only for foreclosure of the tax lien against the parcel.
The judgment may not include a personal judgment against any
person.
(n) A person is considered to have been provided sufficient
notice of foreclosure and opportunity to be heard for purposes of a
proceeding under this section if the taxing unit follows the
procedures required by this section for notice by certified mail or
by publication and posting or if one or more of the following apply:
(1) the person had constructive notice of the hearing
on the merits by acquiring an interest in the parcel after the date
of the filing of the taxing unit’s petition;
(2) the person appeared at the hearing on the taxing
unit’s petition or filed a responsive pleading or other
communication with the clerk of the court before the date of the
hearing; or
(3) before the hearing on the taxing unit’s petition,
the person had actual notice of the hearing.
SECTION 25. Section 42.23, Tax Code, is amended by adding
Subsections (d) and (e) to read as follows:
(d) Each party to an appeal is considered a party seeking
affirmative relief for the purpose of discovery regarding expert
witnesses under the Texas Rules of Civil Procedure if, on or before
the 120th day after the date the appeal is filed, the property
owner:
(1) makes a written offer of settlement;
(2) requests alternative dispute resolution; and
(3) designates, in response to an appropriate written
discovery request, which cause of action under this chapter is the
basis for the appeal.
(e) For purposes of Subsection (d), a property owner may
designate a cause of action under Section 42.25 or 42.26 as the
basis for an appeal, but may not designate a cause of action under
both sections as the basis for the appeal. Discovery regarding a
cause of action that is not specifically designated by the property
owner under Subsection (d) shall be conducted as provided by the
Texas Rules of Civil Procedure. The court may enter a protective
order to modify the provisions of this subsection under Rule 192.6
of the Texas Rules of Civil Procedure.
SECTION 26. Section 12.002(e), Property Code, is amended to
read as follows:
(e) A person may not file for record or have recorded in the
county clerk’s office a plat or replat of a subdivision of real
property unless the plat or replat has attached to it an original
tax certificate from each taxing unit with jurisdiction of the real
property indicating that no delinquent ad valorem taxes are owed on
the real property. This subsection does not apply if:
(1) more than one person acquired the real property
from a decedent under a will or by inheritance and those persons
owning an undivided interest in the property obtained approval to
subdivide the property to provide each person with a divided
interest and a separate title to the property; or
(2) a taxing unit acquired the real property for
public use through eminent domain proceedings or voluntary sale.
SECTION 27. Subchapter B, Chapter 21, Property Code, is
amended by adding Section 21.0211 to read as follows:
Sec. 21.0211. PAYMENT OF AD VALOREM TAXES. (a) A court may
not authorize withdrawal of any money deposited under Section
21.021 unless the petitioner for the money files with the court:
(1) a tax certificate issued under Section 31.08, Tax
Code, by the tax collector for each taxing unit that imposes ad
valorem taxes on the condemned property showing that there are no
delinquent taxes, penalties, interest, or costs owing on the
condemned property or on any larger tract of which the condemned
property forms a part; and
(2) in the case of a whole taking that occurs after the
date the ad valorem tax bill for taxes imposed by a taxing unit on
the property is sent, a tax receipt issued under Section 31.075, Tax
Code, by the tax collector of the taxing unit that imposes ad
valorem taxes showing that the taxes on the condemned property for
the current tax year, prorated under Section 26.11, Tax Code, have
been paid.
(b) For purposes of Subsection (a)(2), a “case of a whole
taking” means a case in which the location, size, and boundaries of
the property assessed for ad valorem taxes are identical to that of
the condemned property.
SECTION 28. Section 17.091(a), Civil Practice and Remedies
Code, is amended to read as follows:
(a) In a suit to collect delinquent property taxes by the
state or a subdivision of the state in which a person who is a
defendant is a nonresident, the secretary of state is an agent for
service of process on that defendant if the defendant owns, has, or
claims an interest in or a lien against property in this state that
is the subject of the suit.
SECTION 29. (a) Section 11.43(m), Tax Code, as added by
this Act, applies only to eligibility for an exemption from ad
valorem taxation under Section 11.13(c) or (d), Tax Code, for an
individual 65 years of age or older for a tax year beginning on or
after January 1, 2006.
(b) Section 23.225, Tax Code, as added by this Act, and
Section 23.51, Tax Code, as amended by this Act, apply only to the
appraisal of land for a tax year that begins on or after January 1,
2006.
(c) Section 31.05(a), Tax Code, as amended by this Act,
applies to the adoption of a discount by a taxing unit beginning
with the 2005 tax year, except as provided by Subsection (d) of this
section.
(d) If a taxing unit’s tax bills for the 2005 tax year are
mailed before the effective date of this Act, Section 31.05(a), Tax
Code, as amended by this Act, applies to the adoption of a discount
by the taxing unit beginning with the 2006 tax year, and the law in
effect when the bills were mailed applies to the 2005 tax year with
respect to that taxing unit.
(e) Section 31.073, Tax Code, as amended by this Act,
applies only to payments of taxes, penalties, or interest that are
made on or after the effective date of this Act.
(f) Section 32.05, Tax Code, as amended by this Act, applies
to any lien, regardless of the date on which it arose, and to any
cause of action pending on the effective date of this Act or brought
after that date.
(g) Section 33.011, Tax Code, as amended by this Act,
applies only to a request for a waiver of penalty or interest made
on or after the effective date of this Act. A request for a waiver
made before the effective date of this Act is governed by the law as
it existed immediately before the effective date of this Act, and
the former law is continued in effect for that purpose.
(h) Section 33.02, Tax Code, as amended by this Act, applies
to an installment agreement entered before, on, or after the
effective date of this Act.
(i) Section 33.22, Tax Code, as amended by this Act, applies
only to a tax warrant proceeding pending on the effective date of
this Act or brought after that date.
(j) Section 33.23, Tax Code, as amended by this Act, applies
only to an installment agreement Section 33.23, Tax Code, as
amended by this Act, applies only to a tax warrant issued on or
after the effective date of this Act. A tax warrant issued before
the effective date of this Act is governed by the law as it existed
immediately before the effective date of this Act, and the former
law is continued in effect for that purpose.
(k) Section 33.25, Tax Code, as amended by this Act, applies
only to a tax warrant proceeding in which the application for a tax
warrant was filed on or after the effective date of this Act. A tax
warrant proceeding commenced by application before the effective
date of this Act is governed by the law as it existed immediately
before the effective date of this Act, and the former law is
continued in effect for that purpose.
(l) Section 33.48, Tax Code, as amended by this Act, applies
only to a cause of action pending on the effective date of this Act
or brought after that date.
(m) Section 33.51, Tax Code, as amended by this Act, applies
to a writ of possession that is based on a judgment entered before,
on, or after the effective date of this Act.
(n) Section 33.57, Tax Code, as added by this Act, applies
only to a cause of action pending on the effective date of this Act
or brought after the effective date of this Act.
(o) Section 42.23, Tax Code, as amended by this Act, applies
only to an appeal of an appraisal review board order if the appeal
is filed or amended on or after the effective date of this Act. An
appeal filed or amended before the effective date of this Act is
covered by the law in effect when the appeal was filed or amended,
and the former law is continued in effect for that purpose.
(p) Section 12.002(e), Property Code, as amended by this
Act, applies only to a plat or replat of a subdivision that is filed
for recordation on or after the effective date of this Act. A plat
or replat of a subdivision that was filed for recordation before the
effective date of this Act is governed by the law in effect
immediately before the effective date of this Act, and the former
law is continued in effect for that purpose.
(q) Section 21.0211, Property Code, as added by this Act,
applies only to an eminent domain proceeding that is commenced on or
after the effective date of this Act. An eminent domain proceeding
commenced before the effective date of this Act is governed by the
law as it existed immediately before the effective date of this Act,
and the former law is continued in effect for that purpose.
(r) Section 17.091, Civil Practice and Remedies Code, as
amended by this Act, applies only to a cause of action pending on
the effective date of this Act or brought after the effective date
of this Act.
SECTION 30. This Act takes effect September 1, 2005.

 

______________________________ ______________________________

President of the Senate Speaker of the House

I certify that H.B. No. 2491 was passed by the House on April
29, 2005, by a non-record vote; that the House refused to concur in
Senate amendments to H.B. No. 2491 on May 27, 2005, and requested
the appointment of a conference committee to consider the
differences between the two houses; and that the House adopted the
conference committee report on H.B. No. 2491 on May 29, 2005, by a
non-record vote.

______________________________
Chief Clerk of the House

I certify that H.B. No. 2491 was passed by the Senate, with
amendments, on May 24, 2005, by the following vote: Yeas 31, Nays
0; at the request of the House, the Senate appointed a conference
committee to consider the differences between the two houses; and
that the Senate adopted the conference committee report on H.B. No.
2491 on May 29, 2005, by the following vote: Yeas 31, Nays 0.

______________________________
Secretary of the Senate

 

APPROVED: __________________

Date

 

__________________

Governor

Property Tax Protection Program™ Benefits

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