Tex.
Gov't Code Section 403.302
Determination of School District Property Values
(a)
The comptroller shall conduct a study using comparable sales and generally accepted auditing and sampling techniques to determine the total taxable value of all property in each school district. The study shall determine the taxable value of all property and of each category of property in the district and the productivity value of all land that qualifies for appraisal on the basis of its productive capacity and for which the owner has applied for and received a productivity appraisal. The comptroller shall make appropriate adjustments in the study to account for actions taken under Chapter 49 (Options for Local Revenue Levels in Excess of Entitlement), Education Code.(a-1)
The comptroller shall conduct a study:(1)
at least every two years in each school district for which the most recent study resulted in a determination by the comptroller that the school district’s local value was valid; and(2)
each year in a school district for which the most recent study resulted in a determination by the comptroller that the school district’s local value was not valid.(a-2)
If in any year the comptroller does not conduct a study, the school district’s local value for that year is considered to be valid.(b)
In conducting the study, the comptroller shall determine the taxable value of property in each school district:(1)
using, if appropriate, samples selected through generally accepted sampling techniques;(2)
according to generally accepted standard valuation, statistical compilation, and analysis techniques;(3)
ensuring that different levels of appraisal on sold and unsold property do not adversely affect the accuracy of the study; and(4)
ensuring that different levels of appraisal resulting from protests determined under Section 41.43 (Protest of Determination of Value or Inequality of Appraisal), Tax Code, are appropriately adjusted in the study.(c)
If after conducting the study the comptroller determines that the local value for a school district is valid, the local value is presumed to represent taxable value for the school district. In the absence of that presumption, taxable value for a school district is the state value for the school district determined by the comptroller under Subsections (a) and (b) unless the local value exceeds the state value, in which case the taxable value for the school district is the district’s local value. In determining whether the local value for a school district is valid, the comptroller shall use a margin of error that does not exceed five percent unless the comptroller determines that the size of the sample of properties necessary to make the determination makes the use of such a margin of error not feasible, in which case the comptroller may use a larger margin of error.(c-1)
This subsection applies only to a school district whose central administrative office is located in a county with a population of 10,000 or less and a total area of more than 6,000 square miles. If after conducting the study for a tax year the comptroller determines that the local value for a school district is not valid, the comptroller shall adjust the taxable value determined under Subsections (a) and (b) as follows:(1)
for each category of property sampled and tested by the comptroller in the school district, the comptroller shall use the weighted mean appraisal ratio determined by the study, unless the ratio is more than four percentage points lower than the weighted mean appraisal ratio determined by the comptroller for that category of property in the immediately preceding study, in which case the comptroller shall use the weighted mean appraisal ratio determined in the immediately preceding study minus four percentage points;(2)
the comptroller shall use the category weighted mean appraisal ratios as adjusted under Subdivision (1) to establish a value estimate for each category of property sampled and tested by the comptroller in the school district; and(3)
the value estimates established under Subdivision (2), together with the local tax roll value for any categories not sampled and tested by the comptroller, less total deductions determined by the comptroller, determine the taxable value for the school district.(d)
For the purposes of this section, “taxable value” means the market value of all taxable property less:(1)
the total dollar amount of any residence homestead exemptions lawfully granted under Section 11.13 (Residence Homestead)(b) or (c), Tax Code, in the year that is the subject of the study for each school district;(2)
one-half of the total dollar amount of any residence homestead exemptions granted under Section 11.13 (Residence Homestead)(n), Tax Code, in the year that is the subject of the study for each school district;(3)
the total dollar amount of any exemptions granted before May 31, 1993, within a reinvestment zone under agreements authorized by Chapter 312 (Property Redevelopment and Tax Abatement Act), Tax Code;(4)
subject to Subsection (e), the total dollar amount of any captured appraised value of property that:(A)
is within a reinvestment zone created on or before May 31, 1999, or is proposed to be included within the boundaries of a reinvestment zone as the boundaries of the zone and the proposed portion of tax increment paid into the tax increment fund by a school district are described in a written notification provided by the municipality or the board of directors of the zone to the governing bodies of the other taxing units in the manner provided by former Section 311.003 (Procedure for Creating Reinvestment Zone)(e), Tax Code, before May 31, 1999, and within the boundaries of the zone as those boundaries existed on September 1, 1999, including subsequent improvements to the property regardless of when made;(B)
generates taxes paid into a tax increment fund created under Chapter 311 (Tax Increment Financing Act), Tax Code, under a reinvestment zone financing plan approved under Section 311.011 (Project and Financing Plans)(d), Tax Code, on or before September 1, 1999; and(C)
is eligible for tax increment financing under Chapter 311 (Tax Increment Financing Act), Tax Code;(5)
the total dollar amount of any captured appraised value of property that:(A)
is within a reinvestment zone:(i)
created on or before December 31, 2008, by a municipality with a population of less than 18,000; and(ii)
the project plan for which includes the alteration, remodeling, repair, or reconstruction of a structure that is included on the National Register of Historic Places and requires that a portion of the tax increment of the zone be used for the improvement or construction of related facilities or for affordable housing;(B)
generates school district taxes that are paid into a tax increment fund created under Chapter 311 (Tax Increment Financing Act), Tax Code; and(C)
is eligible for tax increment financing under Chapter 311 (Tax Increment Financing Act), Tax Code;(6)
the total dollar amount of any exemptions granted under Section 11.251 (Tangible Personal Property Exempt) or 11.253 (Tangible Personal Property in Transit), Tax Code;(7)
the difference between the comptroller’s estimate of the market value and the productivity value of land that qualifies for appraisal on the basis of its productive capacity, except that the productivity value estimated by the comptroller may not exceed the fair market value of the land;(8)
the portion of the appraised value of residence homesteads of individuals who receive a tax limitation under Section 11.26 (Limitation of School Tax on Homesteads of Elderly or Disabled), Tax Code, on which school district taxes are not imposed in the year that is the subject of the study, calculated as if the residence homesteads were appraised at the full value required by law;(9)
a portion of the market value of property not otherwise fully taxable by the district at market value because of action required by statute or the constitution of this state, other than Section 11.311 (Landfill-generated Gas Conversion Facilities), Tax Code, that, if the tax rate adopted by the district is applied to it, produces an amount equal to the difference between the tax that the district would have imposed on the property if the property were fully taxable at market value and the tax that the district is actually authorized to impose on the property, if this subsection does not otherwise require that portion to be deducted;(10)
the market value of all tangible personal property, other than manufactured homes, owned by a family or individual and not held or used for the production of income;(11)
the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.06 (Deferred Collection of Taxes on Residence Homestead of Elderly or Disabled Person or Disabled Veteran), Tax Code;(12)
the portion of the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.065 (Deferred Collection of Taxes on Appreciating Residence Homestead), Tax Code;(13)
the amount by which the market value of property to which Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, applies exceeds the appraised value of that property as calculated under Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, as applicable; and(14)
the total dollar amount of any exemptions granted under Section 11.35 (Temporary Exemption for Qualified Property Damaged by Disaster), Tax Code.(d)
For the purposes of this section, “taxable value” means the market value of all taxable property less:(1)
the total dollar amount of any residence homestead exemptions lawfully granted under Section 11.13 (Residence Homestead)(b) or (c), Tax Code, in the year that is the subject of the study for each school district;(2)
one-half of the total dollar amount of any residence homestead exemptions granted under Section 11.13 (Residence Homestead)(n), Tax Code, in the year that is the subject of the study for each school district;(3)
the total dollar amount of any exemptions granted before May 31, 1993, within a reinvestment zone under agreements authorized by Chapter 312 (Property Redevelopment and Tax Abatement Act), Tax Code;(4)
subject to Subsection (e), the total dollar amount of any captured appraised value of property that:(A)
is within a reinvestment zone created on or before May 31, 1999, or is proposed to be included within the boundaries of a reinvestment zone as the boundaries of the zone and the proposed portion of tax increment paid into the tax increment fund by a school district are described in a written notification provided by the municipality or the board of directors of the zone to the governing bodies of the other taxing units in the manner provided by former Section 311.003 (Procedure for Creating Reinvestment Zone)(e), Tax Code, before May 31, 1999, and within the boundaries of the zone as those boundaries existed on September 1, 1999, including subsequent improvements to the property regardless of when made;(B)
generates taxes paid into a tax increment fund created under Chapter 311 (Tax Increment Financing Act), Tax Code, under a reinvestment zone financing plan approved under Section 311.011 (Project and Financing Plans)(d), Tax Code, on or before September 1, 1999; and(C)
is eligible for tax increment financing under Chapter 311 (Tax Increment Financing Act), Tax Code;(5)
the total dollar amount of any captured appraised value of property that:(A)
is within a reinvestment zone:(i)
created on or before December 31, 2008, by a municipality with a population of less than 18,000; and(ii)
the project plan for which includes the alteration, remodeling, repair, or reconstruction of a structure that is included on the National Register of Historic Places and requires that a portion of the tax increment of the zone be used for the improvement or construction of related facilities or for affordable housing;(B)
generates school district taxes that are paid into a tax increment fund created under Chapter 311 (Tax Increment Financing Act), Tax Code; and(C)
is eligible for tax increment financing under Chapter 311 (Tax Increment Financing Act), Tax Code;(6)
the total dollar amount of any exemptions granted under Section 11.251 (Tangible Personal Property Exempt) or 11.253 (Tangible Personal Property in Transit), Tax Code;(7)
the difference between the comptroller’s estimate of the market value and the productivity value of land that qualifies for appraisal on the basis of its productive capacity, except that the productivity value estimated by the comptroller may not exceed the fair market value of the land;(8)
the portion of the appraised value of residence homesteads of individuals who receive a tax limitation under Section 11.26 (Limitation of School Tax on Homesteads of Elderly or Disabled), Tax Code, on which school district taxes are not imposed in the year that is the subject of the study, calculated as if the residence homesteads were appraised at the full value required by law;(9)
a portion of the market value of property not otherwise fully taxable by the district at market value because of action required by statute or the constitution of this state, other than Section 11.311 (Landfill-generated Gas Conversion Facilities), Tax Code, that, if the tax rate adopted by the district is applied to it, produces an amount equal to the difference between the tax that the district would have imposed on the property if the property were fully taxable at market value and the tax that the district is actually authorized to impose on the property, if this subsection does not otherwise require that portion to be deducted;(10)
the market value of all tangible personal property, other than manufactured homes, owned by a family or individual and not held or used for the production of income;(11)
the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.06 (Deferred Collection of Taxes on Residence Homestead of Elderly or Disabled Person or Disabled Veteran), Tax Code;(12)
the portion of the appraised value of property the collection of delinquent taxes on which is deferred under Section 33.065 (Deferred Collection of Taxes on Appreciating Residence Homestead), Tax Code;(13)
the amount by which the market value of a residence homestead to which Section 23.23 (Limitation on Appraised Value of Residence Homestead), Tax Code, applies exceeds the appraised value of that property as calculated under that section; and(14)
the total dollar amount of any exemptions granted under Section 11.35 (Temporary Exemption for Qualified Property Damaged by Disaster), Tax Code.(d-1)
For purposes of Subsection (d), a residence homestead that receives an exemption under Section 11.131, 11.133 (Residence Homestead of Surviving Spouse of Member of Armed Services Killed in Line of Duty), or 11.134 (Residence Homestead of Surviving Spouse of First Responder Killed in Line of Duty), Tax Code, in the year that is the subject of the study is not considered to be taxable property.(e)
The total dollar amount deducted in each year as required by Subsection (d)(4) in a reinvestment zone created after January 1, 1999, may not exceed the captured appraised value estimated for that year as required by Section 311.011 (Project and Financing Plans)(c)(8), Tax Code, in the reinvestment zone financing plan approved under Section 311.011 (Project and Financing Plans)(d), Tax Code, before September 1, 1999. The number of years for which the total dollar amount may be deducted under Subsection (d)(4) shall for any zone, including those created on or before January 1, 1999, be limited to the duration of the zone as specified as required by Section 311.011 (Project and Financing Plans)(c)(9), Tax Code, in the reinvestment zone financing plan approved under Section 311.011 (Project and Financing Plans)(d), Tax Code, before September 1, 1999. The total dollar amount deducted under Subsection (d)(4) for any zone, including those created on or before January 1, 1999, may not be increased by any reinvestment zone financing plan amendments that occur after August 31, 1999. The total dollar amount deducted under Subsection (d)(4) for any zone, including those created on or before January 1, 1999, may not be increased by a change made after August 31, 1999, in the portion of the tax increment retained by the school district.(e-1)
This subsection applies only to a reinvestment zone created by a municipality that has a population of 83,000 or less and is located in a county in which all or part of a military installation is located. Notwithstanding Subsection (e), if on or after January 1, 2017, the municipality adopts an ordinance designating a termination date for the zone that is later than the termination date designated in the ordinance creating the zone, the number of years for which the total dollar amount may be deducted under Subsection (d)(4) is limited to the duration of the zone as determined under Section 311.017 (Termination of Reinvestment Zone), Tax Code.(f)
The study shall determine the values as of January 1 of each year:(1)
for a school district in which a study was conducted according to the results of the study; and(2)
for a school district in which a study was not conducted according to the market value determined by the appraisal district that appraises property for the district, less the amounts specified by Subsection (d).(g)
The comptroller shall publish preliminary findings, listing values by district, before February 1 of the year following the year of the study. Preliminary findings shall be delivered to each school district and shall be certified to the commissioner of education.(h)
On request of the commissioner of education or a school district, the comptroller may audit the total taxable value of property in a school district and may revise the study findings. The request for audit is limited to corrections and changes in a school district’s appraisal roll that occurred after preliminary certification of the study findings by the comptroller. Except as otherwise provided by this subsection, the request for audit must be filed with the comptroller not later than the third anniversary of the date of the final certification of the study findings. The request for audit may be filed not later than the first anniversary of the date the chief appraiser certifies a change to the appraisal roll if the chief appraiser corrects the appraisal roll under Section 25.25 (Correction of Appraisal Roll) or 42.41 (Correction of Rolls), Tax Code, and the change results in a material reduction in the total taxable value of property in the school district. The comptroller shall certify the findings of the audit to the commissioner of education.(i)
If the comptroller determines in the study that the market value of property in a school district as determined by the appraisal district that appraises property for the school district, less the total of the amounts and values listed in Subsection (d) as determined by that appraisal district, is valid, the comptroller, in determining the taxable value of property in the school district under Subsection (d), shall for purposes of Subsection (d)(13) subtract from the market value as determined by the appraisal district of properties to which Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, applies the amount by which that amount exceeds the appraised value of those properties as calculated by the appraisal district under Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, as applicable. If the comptroller determines in the study that the market value of property in a school district as determined by the appraisal district that appraises property for the school district, less the total of the amounts and values listed in Subsection (d) as determined by that appraisal district, is not valid, the comptroller, in determining the taxable value of property in the school district under Subsection (d), shall for purposes of Subsection (d)(13) subtract from the market value as estimated by the comptroller of properties to which Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, applies the amount by which that amount exceeds the appraised value of those properties as calculated by the appraisal district under Section 23.23 (Limitation on Appraised Value of Residence Homestead) or 23.231 (Circuit Breaker Limitation on Appraised Value of Real Property Other than Residence Homestead), Tax Code, as applicable.(i)
If the comptroller determines in the study that the market value of property in a school district as determined by the appraisal district that appraises property for the school district, less the total of the amounts and values listed in Subsection (d) as determined by that appraisal district, is valid, the comptroller, in determining the taxable value of property in the school district under Subsection (d), shall for purposes of Subsection (d)(13) subtract from the market value as determined by the appraisal district of residence homesteads to which Section 23.23 (Limitation on Appraised Value of Residence Homestead), Tax Code, applies the amount by which that amount exceeds the appraised value of those properties as calculated by the appraisal district under Section 23.23 (Limitation on Appraised Value of Residence Homestead), Tax Code. If the comptroller determines in the study that the market value of property in a school district as determined by the appraisal district that appraises property for the school district, less the total of the amounts and values listed in Subsection (d) as determined by that appraisal district, is not valid, the comptroller, in determining the taxable value of property in the school district under Subsection (d), shall for purposes of Subsection (d)(13) subtract from the market value as estimated by the comptroller of residence homesteads to which Section 23.23 (Limitation on Appraised Value of Residence Homestead), Tax Code, applies the amount by which that amount exceeds the appraised value of those properties as calculated by the appraisal district under Section 23.23 (Limitation on Appraised Value of Residence Homestead), Tax Code.(j)
The comptroller shall certify the final taxable value for each school district, appropriately adjusted to give effect to certain provisions of the Education Code related to school funding, to the commissioner of education as provided by the terms of a memorandum of understanding entered into between the comptroller, the Legislative Budget Board, and the commissioner of education.(j-1)
In the final certification of the study under Subsection (j), the comptroller shall separately identify the final taxable value for each school district as adjusted to account for the reduction of the amount of the limitation on tax increases provided by Section 11.26 (Limitation of School Tax on Homesteads of Elderly or Disabled)(a-10), Tax Code.(j-2)
In the final certification of the study under Subsection (j), the comptroller shall separately identify the final taxable value for each school district as adjusted to account for the reduction of the amount of the limitation on tax increases provided by Sections 11.26 (Limitation of School Tax on Homesteads of Elderly or Disabled)(a-5), (a-6), (a-7), (a-8), (a-9), (a-10), (a-11), and (a-12), Tax Code. This subsection expires January 1, 2025.(k)
If the comptroller determines in the final certification of the study that the school district’s local value as determined by the appraisal district that appraises property for the school district is not valid, the comptroller shall provide notice of the comptroller’s determination to the board of directors of the appraisal district. The board of directors of the appraisal district shall hold a public meeting to discuss the receipt of notice under this subsection.(k-1)
If the comptroller determines in the final certification of the study that the school district’s local value as determined by the appraisal district that appraises property for the school district is not valid for three consecutive years, the comptroller shall conduct an additional review of the appraisal district under Section 5.102 (Review of Appraisal Districts), Tax Code, and provide recommendations to the appraisal district regarding appraisal standards, procedures, and methodologies. The comptroller may contract with a third party to assist the comptroller in conducting the additional review and providing the recommendations required under this subsection. If the appraisal district fails to comply with the recommendations provided under this subsection and the comptroller finds that the board of directors of the appraisal district failed to take remedial action reasonably designed to ensure substantial compliance with each recommendation before the first anniversary of the date the recommendations were made, the comptroller shall notify the Texas Department of Licensing and Regulation, or a successor to the department, which shall take action necessary to ensure that the recommendations are implemented as soon as practicable. Before February 1 of the year following the year in which the Texas Department of Licensing and Regulation, or a successor to the department, takes action under this subsection, the department, with the assistance of the comptroller, shall determine whether the recommendations have been substantially implemented and notify the chief appraiser and the board of directors of the appraisal district of the determination. If the department determines that the recommendations have not been substantially implemented, the board of directors of the appraisal district must, within three months of the determination, consider whether the failure to implement the recommendations was under the current chief appraiser’s control and whether the chief appraiser is able to adequately perform the chief appraiser’s duties.(l)
If after conducting the study for a year the comptroller determines that a school district is an eligible school district, for that year and the following year the taxable value for the school district is the district’s local value.(m)
Repealed by Acts 2019, 86th Leg., R.S., Ch. 943 (H.B. 3), Sec. 4.001(b), eff. September 1, 2019.(m-1)
Repealed by Acts 2019, 86th Leg., R.S., Ch. 944 (S.B. 2), Sec. 91(1), eff. January 1, 2020.(n)
Repealed by Acts 2019, 86th Leg., R.S., Ch. 944 (S.B. 2), Sec. 91(1), eff. January 1, 2020.(o)
The comptroller shall adopt rules governing the conduct of the study after consultation with the comptroller’s property tax administration advisory board.
Source:
Section 403.302 — Determination of School District Property Values, https://statutes.capitol.texas.gov/Docs/GV/htm/GV.403.htm#403.302 (accessed May 4, 2024).
