H.B. No. 2555

AN ACT
relating to the exemption from ad valorem taxation of certain
property acquired to provide low-income housing or used for
charitable purposes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 11.181(b), Tax Code, is amended to read
as follows:
(b) Property may not be exempted under Subsection (a) after
the fifth [third] anniversary of the date the organization acquires
the property.
SECTION 2. (a) Section 11.184, Tax Code, is amended by
amending Subsection (c) and adding Subsections (l), (m), and (n) to
read as follows:
(c) A [If approved under Subsection (b), a] qualified
charitable organization is entitled to an exemption from taxation
of:
(1) the buildings and other real property and the
tangible personal property that:
(A) are owned by the organization; and
(B) except as permitted by Subsection (d), are
used exclusively by the organization and other organizations
eligible for an exemption from taxation under this section or
Section 11.18; and
(2) the real property owned by the organization
consisting of:
(A) an incomplete improvement that:
(i) is under active construction or other
physical preparation; and
(ii) is designed and intended to be used
exclusively by the organization and other organizations eligible
for an exemption from taxation under this section or Section 11.18;
and
(B) the land on which the incomplete improvement
is located that will be reasonably necessary for the use of the
improvement by the organization and other organizations eligible
for an exemption from taxation under this section or Section 11.18.
(l) Notwithstanding the other provisions of this section, a
corporation that is not a qualified charitable organization is
entitled to an exemption from taxation of property under this
section if:
(1) the corporation is exempt from federal income
taxation under Section 501(a), Internal Revenue Code of 1986, by
being listed as an exempt entity under Section 501(c)(2) of that
code;
(2) the corporation holds title to the property for,
collects income from the property for, and turns over the entire
amount of that income, less expenses, to a qualified charitable
organization; and
(3) the qualified charitable organization would
qualify for an exemption from taxation of the property under this
section if the qualified charitable organization owned the
property.
(m) Before a corporation described by Subsection (l) may
submit an application for an exemption under this section, the
qualified charitable organization for which the corporation holds
title to the property must apply to the comptroller for the
determination described by Subsection (e) with regard to the
qualified charitable organization. The application for the
determination must also include an application to the comptroller
for a determination of whether the corporation meets the
requirements of Subsections (l)(1) and (2). The corporation shall
submit with the application for an exemption under this section a
copy of the determination letter issued by the comptroller. The
chief appraiser shall accept the copy of the letter as conclusive
evidence of the matters described by Subsection (h) as well as of
whether the corporation meets the requirements of Subsections
(l)(1) and (2).
(n) Notwithstanding Subsection (k), in order for a
corporation to continue to receive an exemption under Subsection
(l) after the fifth tax year after the year in which the exemption
is granted, the qualified charitable organization for which the
corporation holds title to property must obtain a new determination
letter and the corporation must reapply for the exemption.
(b) Section 11.184(b), Tax Code, is repealed.
(c) This section applies only to ad valorem taxes imposed
for a tax year that begins on or after the effective date of this
section.
(d) This section takes effect January 1, 2010.
SECTION 3. This Act does not make an appropriation. A
provision in this Act that creates a new governmental program,
creates a new entitlement, or imposes a new duty on a governmental
entity is not mandatory during a fiscal period for which the
legislature has not made a specific appropriation to implement the
provision.
SECTION 4. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2009.

______________________________ ______________________________
President of the Senate           Speaker of the House

I certify that H.B. No. 2555 was passed by the House on April
22, 2009, by the following vote: Yeas 149, Nays 0, 1 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 2555 on May 31, 2009, by the following vote: Yeas 143, Nays 0,
2 present, not voting.

______________________________
Chief Clerk of the House

I certify that H.B. No. 2555 was passed by the Senate, with
amendments, on May 26, 2009, by the following vote: Yeas 31, Nays
0.

______________________________
Secretary of the Senate
APPROVED: __________________
Date

__________________
Governor