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 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 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 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; planting cover crops or leaving land idle for the purpose of participating in a 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 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 notice required by this section does not affect the validity of the appraisal of theproperty, 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 contain a statement in the following form: “NOTICE OF PUBLIC HEARING ON TAX INCREASE
“The (name of the taxing unit) will hold two public hearings 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 year 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.
(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 TAX REVENUE INCREASE “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
“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
(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