America's Property Tax Advisor

Texas Tax Legislation Passed

BY FOY MITCHELL, DALLAS, JUNE 2021

The Texas Legislature adjourned on May 31, 2021, at 12PM as required by law. During the recently completed 140-day session 6,927 bills were introduced in the House and Senate. Of these 1,073 passed and were sent to the governor.

 

Several bills considered property tax issues ranging from the appointment/election of members of Appraisal Review Boards and Boards of Directors, restrictions on the valuation of property, numerous exemptions, and emphasis on seeking more fairness in the process. A few bills passed that will significantly improve the overall system to the benefit of taxpayers.

 

Some of the highlight legislation passed is as follows:

 

HB 988

 

  • Prohibits communications between governmental officers and the chief appraiser that could influence valuations.

  • In disaster areas, taxpayers have 270 days to qualify their inventory for Freeport Exemptions.

  • Appraisal districts must notify taxpayers when an account number is changed.

  • A taxpayer may request combination of tracts, unless the property is residential, or an improvement-only account.

  • Informal conferences with a taxpayer or agent are mandatory and law provides procedures for insuring their use.

  • Appraisal districts may not send corrected or amended notices of value to a taxpayer later than June 1.

  • Taxpayers protesting their property may request their protest be heard by a single Appraisal Review Board member instead of a panel.

  • Property owners may file a limited scope arbitration request for issues the ARB may have failed to properly handle.

 

HB 3833:

 

  • Provides special appraisal procedures of properties rented to low-income renters.

  • Changes the agricultural valuation change of use penalty from five years to three years.

 

SB63:

 

  • Mandates a five-year term limit to the appraisal district Board of Directors. Former employees of the appraisal district and tax agents may not serve on the board until three years have elapsed.

  • Exemption applications must be processed within 90 days of filing.

  • Request for changes pursuant to Section 25.25 of the property tax code filed after January 1 but before September 1 must have hearings scheduled within 90 days.

  • Protest forms must provide for a taxpayer to appeal both value and equity.

  • All evidence files at an ARB hearing must have been shared with the taxpayer or agent prior to the hearing.

  • Provides an entitlement for a tax exemption based on renewable energy devices.

 

SB 1449:

 

  • Increases the exemption for filing business personal property from $500 to $2,500.

 

Although not a specific part of property tax legislation, HB 1869 redefines “Debt” as currently in law to ensure that tax entities may not issue Certificates of Obligation as a way of avoiding taxpayer referendums on the debt. This forces tax entities to go to their voters whenever they wish to incur a debt that must be paid from property tax revenues.

 

My summarization of this legislative session from a property tax perspective is that it was a rather minor adjustment to an otherwise excellent system. Attempts have been made to make the system more transparent and to ensure the taxpayer has every opportunity to seek equitable value.

 

Perhaps an overriding thought in the minds of Legislators is that in 2019 they passed landmark legislation that will significantly control the growth of taxes by tax rate limitations. These limitations take a number of years to significantly manifest themselves, but many professionals believe they will do so in a positive manner, thereby lowering the focus on property taxes in Texas.