80th Texas Legislative Summary - About Popp, Gray & Hutcheson

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Texas Legislative Summary

Jim Popp
Popp Gray & Hutcheson, LLP

The 80th Texas Legislature recently adjourned. The legislative session started with much focus and attention on property taxes and the property tax system. After conducting various hearings around the state, the Governor's Task Force on Appraisal Reform called for many changes in the property tax system. Several taxpayer groups also called for change. As a result, there were over 300 bills introduced addressing property taxes. However, as the session progressed, it became clear that the Texas system is not broken but rather is one of the best in the country. At the session's close, 53 bills on property taxes passed; none made significant changes. Below follows a brief summary of some of the bills that passed and some that did not. For further information or questions, please call or email Jim Popp at 512.473.2661 or jim.popp@property-tax.com.

Business Taxpayer Related Legislative Changes

Rendition

Provides that if the information contained in the most recently filed rendition continues to be accurate, the taxpayer only needs to check a box rather than preparing a completely new rendition. (Effective 1/1/08)(HB 264)

Appraisal District Procedures

Repeals overlapping appraisal district provisions and provides that all property shall be appraised by only one appraisal district and (Effective 1/1/08)(HB 1010)

Excludes sales information obtained by the appraisal district from a private entity such as MLS from open records requirements. However, allows a property owner to obtain such information for the limited purpose of use in a protest hearing. (Effective 9/1/07) (HB 2188)

Provides that, when determining taxable values for the comptroller's ratio study, values will be adjusted to reflect changes made to the values at the protest hearings. (Effective upon Governor Signature.)(HB 3492)

Imposes a penalty for ex parte communications between a member of an appraisal district board of directors and the chief appraiser. (Effective 9/1/07)(HB 402)

Allows an appraisal district to postpone the July 20 deadline for approval of appraisal records by the ARB and permits approval of records if 10% rather than 5%. of the properties are still under protest. (Effective 1/1/08)(HB 538)

Provides that if an owner of a portable drilling rig renders the rig in the county in which the rig was located on January 1, the rig is taxable in that county rather than in the county of the owner's principal place of business. (Effective 1/1/08)(HB 2982)

Sets forth a methodology for the comptroller to calculate a market condition factor for the valuation of oil and gas interests. (Effective 1/1/08)(HB 2982)

Taxpayer Remedies

Allows a property owner, not represented by an agent, one automatic postponement of an ARB hearing. (Effective 1/1/08)(HB 538)

Amends Section 42.08 to provide that a property owner who decides to pay less than the full amount of taxes must declare that in the original petition. (Effective upon Governor Signature)) (HB1680)

Provides that for purposes of a protest of failure to receive notice under Section 41.411, the delinquency date (and thus the protest deadline) is postponed to the 125th day after one or more taxing units first delivers notice of taxes due. (Effective 1/1/08)(HB 3496)

Exemptions

Provides a new type of exemption for goods in transit by applying the exemption to goods held at a property not owned by the owner of the goods, such as at a leased warehouse. (Effective 1/1/08)(HB621)

Tax Collections

Provides that if an assessor mails a tax bill to the mortgagee, the assessor is not required to mail a bill to the mortgagor or to the mortgagor's authorized agent. (Effective 9/1/07)(HB 923)

Provides for certain truth in taxation notices if a city or county budget raises more property taxes than the previous year's budget. (Effective 9/1/07)(HB 3195)

Homeowner Related Legislative Changes

Exemptions

Provides for a reduction of the limitation on the total amount of property taxes that may be imposed by a school district on the residence homesteads of the elderly or disabled to reflect any reduction in the school district's tax rates. (Effective upon governor Signature and applies to 2007 tax year)( HB 5)

Limits the maximum percentage increase in the appraised value of a residence homestead to 10% over the prior year as opposed to an average of 10% over three years. (Effective 1/1/08 if Constitutional Amendment passes)(HB 438)

Provides for the creation, operation, and management of programs of homestead preservation districts. (Effective 9/1/07)(HB 470)

Provides for the exemption of one passenger car or light truck owned by an individual and used in the course of the owner's occupation or profession and also for personal activities of the owner. (Effective to 2007 tax year if Constitutional Amendment passes.)(HB1022)

Exempts from taxation certain travel trailers. (Effective 1/1/08)(HB 1928)

Appraisal District Procedures

Allows a property owner not represented by an agent one automatic postponement of a hearing. (Effective 1/1/08)(HB 538)

Prohibits an appeal to district by the chief appraiser of an ARB order on a property with a value less than $1,000,000. (Effective upon governor Signature)(HB1680)

Excepts information obtained by the appraisal district from a private entity such as MLS from open records requirements. However, allows a property owner to obtain such information for the limited purpose of use in a protest hearing. (Effective 9/1/07)(HB 2188)

Provides that on a protest of a property of less then $1,000,000, if the owner provides an appraisal, then the burden of proof shifts to the appraisal district. (Effective 9/1/07)(HB 3024)

Changes the notice of appraised value deadlines to April 1 for homes and May 1 for other property. Changes the protest deadline for homes to May 1 with an automatic extension to May 31. (Effective 1/1/08)( HB 3496)

Tax Collections

If an assessor mails a tax bill to the mortgagee, the assessor is not required to mail a bill to the mortgagor or to the mortgagor's authorized agent. (Effective 9/1/07)(HB 923)

Provides for the creation and regulation of property tax lenders. (Effective 9/1/07)(HB 2138)

Provides authority to the governing body of a taxing unit to waive penalties and interest on a delinquent tax if the taxpayer mailed the tax payment to an incorrect address that in a prior year was a correct address. (Effective upon governor Signature)(SB 1063)

Legislation That Did Not Pass

Requiring disclosure to the appraisal district by a purchaser of the sales price of a property.

Requiring voter approval of spending in excess of reasonable levels of local government growth.

Changing the makeup of the appraisal district board of directors to include elected members.

Requiring disclosure of all commercial sales to an appriaisal district.

Applying a percentage limit on the amount a commercial property may increase in value from year to year.

Lowering the appraisal cap limitation on residential property of 10% to a lower percentage.

Limiting the increases in appraised value on a property to the five year rolling average value of the property.

Allowing a .5 cent local option sales tax in place of property taxes.

FOUR BARTON SKYWAY 1301 S MOPAC, STE 430 AUSTIN, TX 78746 MAPS & DIRECTIONS		512.473.2661 800.473.2661 FAX: 512.479.8013 E-MAIL
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Texas Legislative Summary Jim Popp Popp Gray & Hutcheson, LLP The 80th Texas Legislature recently adjourned. The legislative session started with much focus and attention on property taxes and the property tax system. After conducting various hearings around the state, the Governor's Task Force on Appraisal Reform called for many changes in the property tax system. Several taxpayer groups also called for change. As a result, there were over 300 bills introduced addressing property taxes. However, as the session progressed, it became clear that the Texas system is not broken but rather is one of the best in the country. At the session's close, 53 bills on property taxes passed; none made significant changes. Below follows a brief summary of some of the bills that passed and some that did not. For further information or questions, please call or email Jim Popp at 512.473.2661 or jim.popp@property-tax.com. Business Taxpayer Related Legislative Changes Rendition Provides that if the information contained in the most recently filed rendition continues to be accurate, the taxpayer only needs to check a box rather than preparing a completely new rendition. (Effective 1/1/08)(HB 264) Appraisal District Procedures Repeals overlapping appraisal district provisions and provides that all property shall be appraised by only one appraisal district and (Effective 1/1/08)(HB 1010) Excludes sales information obtained by the appraisal district from a private entity such as MLS from open records requirements. However, allows a property owner to obtain such information for the limited purpose of use in a protest hearing. (Effective 9/1/07) (HB 2188) Provides that, when determining taxable values for the comptroller's ratio study, values will be adjusted to reflect changes made to the values at the protest hearings. (Effective upon Governor Signature.)(HB 3492) Imposes a penalty for ex parte communications between a member of an appraisal district board of directors and the chief appraiser. (Effective 9/1/07)(HB 402) Allows an appraisal district to postpone the July 20 deadline for approval of appraisal records by the ARB and permits approval of records if 10% rather than 5%. of the properties are still under protest. (Effective 1/1/08)(HB 538) Provides that if an owner of a portable drilling rig renders the rig in the county in which the rig was located on January 1, the rig is taxable in that county rather than in the county of the owner's principal place of business. (Effective 1/1/08)(HB 2982) Sets forth a methodology for the comptroller to calculate a market condition factor for the valuation of oil and gas interests. (Effective 1/1/08)(HB 2982) Taxpayer Remedies Allows a property owner, not represented by an agent, one automatic postponement of an ARB hearing. (Effective 1/1/08)(HB 538) Amends Section 42.08 to provide that a property owner who decides to pay less than the full amount of taxes must declare that in the original petition. (Effective upon Governor Signature)) (HB1680) Provides that for purposes of a protest of failure to receive notice under Section 41.411, the delinquency date (and thus the protest deadline) is postponed to the 125th day after one or more taxing units first delivers notice of taxes due. (Effective 1/1/08)(HB 3496) Exemptions Provides a new type of exemption for goods in transit by applying the exemption to goods held at a property not owned by the owner of the goods, such as at a leased warehouse. (Effective 1/1/08)(HB621) Tax Collections Provides that if an assessor mails a tax bill to the mortgagee, the assessor is not required to mail a bill to the mortgagor or to the mortgagor's authorized agent. (Effective 9/1/07)(HB 923) Provides for certain truth in taxation notices if a city or county budget raises more property taxes than the previous year's budget. (Effective 9/1/07)(HB 3195) Homeowner Related Legislative Changes Exemptions Provides for a reduction of the limitation on the total amount of property taxes that may be imposed by a school district on the residence homesteads of the elderly or disabled to reflect any reduction in the school district's tax rates. (Effective upon governor Signature and applies to 2007 tax year)( HB 5) Limits the maximum percentage increase in the appraised value of a residence homestead to 10% over the prior year as opposed to an average of 10% over three years. (Effective 1/1/08 if Constitutional Amendment passes)(HB 438) Provides for the creation, operation, and management of programs of homestead preservation districts. (Effective 9/1/07)(HB 470) Provides for the exemption of one passenger car or light truck owned by an individual and used in the course of the owner's occupation or profession and also for personal activities of the owner. (Effective to 2007 tax year if Constitutional Amendment passes.)(HB1022) Exempts from taxation certain travel trailers. (Effective 1/1/08)(HB 1928) Appraisal District Procedures Allows a property owner not represented by an agent one automatic postponement of a hearing. (Effective 1/1/08)(HB 538) Prohibits an appeal to district by the chief appraiser of an ARB order on a property with a value less than $1,000,000. (Effective upon governor Signature)(HB1680) Excepts information obtained by the appraisal district from a private entity such as MLS from open records requirements. However, allows a property owner to obtain such information for the limited purpose of use in a protest hearing. (Effective 9/1/07)(HB 2188) Provides that on a protest of a property of less then $1,000,000, if the owner provides an appraisal, then the burden of proof shifts to the appraisal district. (Effective 9/1/07)(HB 3024) Changes the notice of appraised value deadlines to April 1 for homes and May 1 for other property. Changes the protest deadline for homes to May 1 with an automatic extension to May 31. (Effective 1/1/08)( HB 3496) Tax Collections If an assessor mails a tax bill to the mortgagee, the assessor is not required to mail a bill to the mortgagor or to the mortgagor's authorized agent. (Effective 9/1/07)(HB 923) Provides for the creation and regulation of property tax lenders. (Effective 9/1/07)(HB 2138) Provides authority to the governing body of a taxing unit to waive penalties and interest on a delinquent tax if the taxpayer mailed the tax payment to an incorrect address that in a prior year was a correct address. (Effective upon governor Signature)(SB 1063) Legislation That Did Not Pass Requiring disclosure to the appraisal district by a purchaser of the sales price of a property. Requiring voter approval of spending in excess of reasonable levels of local government growth. Changing the makeup of the appraisal district board of directors to include elected members. Requiring disclosure of all commercial sales to an appriaisal district. Applying a percentage limit on the amount a commercial property may increase in value from year to year. Lowering the appraisal cap limitation on residential property of 10% to a lower percentage. Limiting the increases in appraised value on a property to the five year rolling average value of the property. Allowing a .5 cent local option sales tax in place of property taxes.