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H.B. No. 3630

H.B. No. 3630

AN ACT

relating to the appraisal for ad valorem tax purposes of
agricultural or open-space land.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 23, Tax Code, is amended by
adding Section 23.25 to read as follows:
Sec. 23.25. APPRAISAL OF LAND USED FOR SINGLE-FAMILY
RESIDENTIAL PURPOSES THAT IS CONTIGUOUS TO AGRICULTURAL OR
OPEN-SPACE LAND WITH COMMON OWNERSHIP. (a) This section applies
only to the appraisal of a parcel of land that:
(1) is used for single-family residential purposes;
and
(2) is contiguous to a parcel of land that is:
(A) appraised under Subchapter C or D; and
(B) owned by:
(i) the same person;
(ii) the person’s spouse;
(iii) an individual related within the
first degree of consanguinity to the person; or
(iv) a legal entity that is affiliated with
the person.
(b) In appraising the parcel of land, the chief appraiser
shall:
(1) determine the price for which the parcel of land
being appraised and the contiguous parcel of land described by
Subsection (a)(2) would sell if both parcels were sold as a single
combined parcel of land; and
(2) attribute a portion of the amount determined under
Subdivision (1) to the parcel of land being appraised based on the
proportion that the size of the parcel of land being appraised bears
to the size of the single combined parcel of land described by
Subdivision (1).
(c) If the chief appraiser uses the market data comparison
method of appraisal to appraise the parcel of land, the chief
appraiser may not use comparable sales data pertaining to the sale
of land located in the corporate limits of a municipality.
SECTION 2. Section 23.42, Tax Code, is amended by amending
Subsection (a) and adding Subsection (a-1) to read as follows:
(a) Except as provided by Subsection (a-1), an [An]
individual is entitled to have land he owns designated for
agricultural use if, on January 1:
(1) the land has been devoted exclusively to or
developed continuously for agriculture for the three years
preceding the current year;
(2) the individual [he] is using and intends to use the
land for agriculture as an occupation or a business venture for
profit during the current year; and
(3) agriculture is the individual’s [his] primary
occupation and primary source of income.
(a-1) On or after January 1, 2008, an individual is not
entitled to have land designated for agricultural use if the land
secures a home equity loan described by Section 50(a)(6), Article
XVI, Texas Constitution.
SECTION 3. Section 23.51(2), Tax Code, is amended to read as
follows:
(2) “Agricultural use” includes but is not limited to
the following activities: cultivating the soil, producing crops for
human food, animal feed, or planting seed or for the production of
fibers; floriculture, viticulture, and horticulture; raising or
keeping livestock; raising or keeping exotic animals for the
production of human food or of fiber, leather, pelts, or other
tangible products having a commercial value; [and] planting cover
crops or leaving land idle for the purpose of participating in a
[any] governmental program, provided the land is not used for
residential purposes or a purpose inconsistent with agricultural
use; and planting cover crops or leaving land idle in conjunction
with [or] normal crop or livestock rotation procedure. The term
also includes the use of land to produce or harvest logs and posts
for the use in constructing or repairing fences, pens, barns, or
other agricultural improvements on adjacent qualified open-space
land having the same owner and devoted to a different agricultural
use. The term also includes the use of land for wildlife management.
SECTION 4. Section 25.19, Tax Code, is amended by adding
Subsection (b-2) and amending Subsection (d) to read as follows:
(b-2) This subsection applies only to a notice of appraised
value for residential real property that has not qualified for a
residence homestead exemption in the current tax year. If the
records of the appraisal district indicate that the address of the
property is also the address of the owner of the property, in
addition to containing the applicable information required by
Subsections (b), (b-1), and (f), the notice must contain the
following statement in boldfaced 12-point type: “According to the
records of the appraisal district, the residential real property
described in this notice of appraised value is not currently being
allowed a residence homestead exemption from ad valorem taxation.
If the property is your home and you occupy it as your principal
place of residence, the property may qualify for one or more
residence homestead exemptions, which will reduce the amount of
taxes imposed on the property. The form needed to apply for a
residence homestead exemption is enclosed. Although the form may
state that the deadline for filing an application for a residence
homestead exemption is April 30, a late application for a residence
homestead exemption will be accepted if filed before February 1,
(insert year application must be filed). There is no fee or charge
for filing an application or a late application for a residence
homestead exemption.” The notice must be accompanied by an
application form for a residence homestead exemption.
(d) Failure to receive a [the] notice required by this
section does not affect the validity of the appraisal of the
property, the imposition of any tax on the basis of the appraisal,
the existence of any tax lien, the deadline for filing an
application for a residence homestead exemption, or any proceeding
instituted to collect the tax.
SECTION 5. (a) Section 26.06(b), Tax Code, as amended by
Chapter 807, Acts of the 79th Legislature, Regular Session, 2005,
is amended to read as follows:
(b) The notice of a public hearing may not be smaller than
one-quarter page of a standard-size or a tabloid-size newspaper,
and the headline on the notice must be in 24-point or larger type.
The notice must[:
[(1)] contain a statement in the following form:
“NOTICE OF PUBLIC HEARING ON TAX INCREASE
“The (name of the taxing unit) will hold two [a] public
hearings [hearing] on a proposal to increase total tax revenues
from properties on the tax roll in the preceding tax year by
(percentage by which proposed tax rate exceeds lower of rollback
tax rate or effective tax rate calculated under this chapter)
percent. Your individual taxes may increase at a greater or lesser
rate, or even decrease, depending on the change in the taxable value
of your property in relation to the change in taxable value of all
other property and the tax rate that is adopted.
“The first public hearing will be held on (date and time) at
(meeting place).
“The second public hearing will be held on (date and time) at
(meeting place).
“(Names of all members of the governing body, showing how
each voted on the proposal to consider the tax increase or, if one
or more were absent, indicating the absences.)
“The average taxable value of a residence homestead in (name
of taxing unit) last year was $ (average taxable value of a last year was $ (average taxable value of a
residence homestead in the taxing unit for the preceding tax year,
disregarding residence homestead exemptions available only to
disabled persons or persons 65 years of age or older). Based on . Based on
last year’s tax rate of $ (preceding year’s adopted tax rate) per
$100 of taxable value, the amount of taxes imposed last year on the , the amount of taxes imposed last year on the
average home was $ (tax on average taxable value of a residence
homestead in the taxing unit for the preceding tax year,
disregarding residence homestead exemptions available only to
disabled persons or persons 65 years of age or older)..
“The average taxable value of a residence homestead in (name
of taxing unit) this year is $ (average taxable value of a this year is $ (average taxable value of a
residence homestead in the taxing unit for the current tax year,
disregarding residence homestead exemptions available only to
disabled persons or persons 65 years of age or older). If the . If the
governing body adopts the effective tax rate for this year of
$(effective tax rate) per $100 of taxable value, the amount of
taxes imposed this year on the average home would be $ (tax on
average taxable value of a residence homestead in the taxing unit
for the current tax year, disregarding residence homestead
exemptions available only to disabled persons or persons 65 years
of age or older)..
“If the governing body adopts the proposed tax rate of
$(proposed tax rate) per $100 of taxable value, the amount of
taxes imposed this year on the average home would be $ (tax on
the average taxable value of a residence in the taxing unit for the
current year disregarding residence homestead exemptions available
only to disabled persons or persons 65 years of age or older)..
“Members of the public are encouraged to attend the hearings
and express their views.”[; and
[(2) contain the following information:
[(A) a section entitled “Comparison of Proposed
Budget with Last Year’s Budget,” which must show the difference,
expressed as a percent increase or decrease, as applicable, in the
amount budgeted in the preceding fiscal year and the amount
budgeted for the fiscal year that begins in the current tax year for
each of the following:
[(i) maintenance and operations;
[(ii) debt service; and
[(iii) total expenditures;
[(B) a section entitled “Total Appraised Value
and Total Taxable Value,” which must show the total appraised value
and the total taxable value of all property and the total appraised
value and the total taxable value of new property taxable by the
unit in the preceding tax year and the current tax year as
calculated under Section 26.04;
[(C) the total amount of the outstanding and
unpaid bonded indebtedness of the taxing unit;
[(D) the unit’s adopted tax rate for the
preceding tax year and the proposed tax rate, expressed as an amount
per $100;
[(E) the difference, expressed as an amount per
$100 and as a percent increase or decrease, as applicable, in the
proposed tax rate compared to the adopted tax rate for the preceding
tax year;
[(F) the average appraised value of a residence
homestead in the taxing unit in the preceding tax year and in the
current tax year; the unit’s homestead exemption, other than an
exemption available only to disabled persons or persons 65 years of
age or older, applicable to that appraised value in each of those
years; and the average taxable value of a residence homestead in the
unit in each of those years, disregarding any homestead exemption
available only to disabled persons or persons 65 years of age or
older;
[(G) the amount of tax that would have been
imposed by the unit in the preceding tax year on a residence
homestead appraised at the average appraised value of a residence
homestead in that year, disregarding any homestead exemption
available only to disabled persons or persons 65 years of age or
older;
[(H) the amount of tax that would be imposed by
the unit in the current tax year on a residence homestead appraised
at the average appraised value of a residence homestead in the
current tax year, disregarding any homestead exemption available
only to disabled persons or persons 65 years of age or older, if the
proposed tax rate is adopted; and
[(I) the difference between the amounts of tax
calculated under Paragraphs (G) and (H), expressed in dollars and
cents and described as the annual increase or decrease, as
applicable, in the tax to be imposed by the unit on the average
residence homestead in the unit in the current tax year if the
proposed tax rate is adopted.]
(b) Section 26.06(d), Tax Code, is amended to read as
follows:
(d) At the public hearings the governing body shall announce
the date, time, and place of the meeting at which it will vote on the
proposed tax rate. After each hearing the governing body shall give
notice of the meeting at which it will vote on the proposed tax rate
and the notice shall be in the same form as prescribed by
Subsections (b) and (c), except that it must state the following:
“NOTICE OF [VOTE ON] TAX REVENUE INCREASE [RATE]
“The (name of the taxing unit) conducted public hearings on
(date of first hearing) and (date of second hearing) on a proposal
to increase the total tax revenues of the (name of the taxing unit)
from properties on the tax roll in the preceding year by (percentage
by which proposed tax rate exceeds lower of rollback tax rate or
effective tax rate calculated under this chapter) percent [on
(dates and times public hearings were conducted)].
“The total tax revenue proposed to be raised last year at last
year’s tax rate of (insert tax rate for the preceding year) for each
$100 of taxable value was (insert total amount of taxes imposed in
the preceding year).
“The total tax revenue proposed to be raised this year at the
proposed tax rate of (insert proposed tax rate) for each $100 of
taxable value, excluding tax revenue to be raised from new property
added to the tax roll this year, is (insert amount computed by
multiplying proposed tax rate by the difference between current
total value and new property value).
“The total tax revenue proposed to be raised this year at the
proposed tax rate of (insert proposed tax rate) for each $100 of
taxable value, including tax revenue to be raised from new property
added to the tax roll this year, is (insert amount computed by
multiplying proposed tax rate by current total value).
“The (governing body of the taxing unit) is scheduled to vote
on the tax rate that will result in that tax increase at a public
meeting to be held on (date of meeting) at (location of meeting,
including mailing address) at (time of meeting [and time) at
(meeting place]).”
(c) Section 26.06(b), Tax Code, as amended by Chapter 1368,
Acts of the 79th Legislature, Regular Session, 2005, is repealed.
SECTION 6. This Act applies only to the appraisal of a
parcel of land for ad valorem tax purposes for a tax year that
begins on or after the effective date of this Act.
SECTION 7. This Act takes effect January 1, 2008.

______________________________ ______________________________
President of the Senate Speaker of the House

I certify that H.B. No. 3630 was passed by the House on May 2,
2007, by the following vote: Yeas 146, Nays 1, 2 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 3630 on May 25, 2007, by the following vote: Yeas 139, Nays 0,
2 present, not voting.

______________________________
Chief Clerk of the House

I certify that H.B. No. 3630 was passed by the Senate, with
amendments, on May 23, 2007, by the following vote: Yeas 30, Nays
1.

______________________________
Secretary of the Senate
APPROVED: __________________
Date

__________________
Governor

Property Tax Protection Program™ Benefits

  • No flat fees or upfront costs.  No cost ever unless your property taxes are reduced.
  • All practical efforts are made every year to reduce your property taxes.
  • Never miss another appeal deadline.
  • Property taxes protested for you annually.
  • You do not have to accept the appraisal district’s initial guesstimate of value.
  • We coordinate with you regarding building size / condition to avoid excess taxes.
  • Free support regarding homestead exemptions.
  • Some years are good – typically 6 to 7 out of 10 will result in tax reduction for you.
  • The other 3 to 4 years out of 10 we strike out. Most often due to people issues in the hearing process. Some years we get an easy appraiser at the informal; some years someone who is impossible to settle with.
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