County-Related News

State Mandates Specific Language, Procedure for Tax Rate Increase

The 81st Legislature enacted three new requirements that commissioners courts must follow when setting a tax rate that exceeds the effective tax rate. These requirements were effective in June and will be necessary when setting tax rates this year.

House Bill 2291 by Rep. Dan Gattis (R-Georgetown) and Sen. Steve Ogden (R-Bryan) includes the following:

• Specific language that must be used in making the motion to adopt a new rate that exceeds the effective tax rate;

• Mandated language for court orders when adoption of a tax rate will result in an increase in the effective maintenance and operations rate, including the dollar amount of increased taxes on a $100,000 home; and

• Specific language that is required to be posted on a county’s Internet Website when the effective maintenance and operations rate is increased, including the increase on a $100,000 home (this section does not apply to counties that do not have Internet sites).

For specific details on the new mandate, a memo by Karen Gladney of
the Texas Association of Counties Legal Department follows:

During the 81st Regular Session of the Texas Legislature, Section 26.05 of the Tax Code was amended to prescribe the specific language that the commissioners court must use in the motion and order to adopt a tax rate that exceeds the effective tax rate. House Bill 2291 took effect on June 19, 2009, and it applies to the adoption of an ad valorem tax rate after that date.

Motion to adopt tax rate: A motion to adopt an order setting a tax rate that exceeds the effective tax rate must be made in the following form:

“I move that the property tax rate be increased by the adoption of a tax rate of (specify tax rate), which is effectively a (insert percentage by which the proposed tax rate exceeds the effective tax rate) percent increase in the tax rate.”

Order to adopt tax rate: An order setting a tax rate that, if applied to the total taxable value, will impose an amount of taxes to fund the county’s maintenance and operation expenditures that exceeds the amount of taxes imposed for that purpose in the preceding year, must include the following statement:

“THIS TAX RATE WILL RAISE MORE TAXES FOR MAINTENANCE AND OPERATIONS THAN LAST YEAR'S TAX RATE.”

If the tax rate exceeds the effective maintenance and operations rate, the order must also include the following statement:

“THE TAX RATE WILL EFFECTIVELY BE RAISED BY (INSERT PERCENTAGE BY WHICH THE TAX RATE EXCEEDS THE EFFECTIVE MAINTENANCE AND OPERATIONS RATE) PERCENT AND WILL RAISE TAXES FOR MAINTENANCE AND OPERATIONS ON A $100,000 HOME BY APPROXIMATELY $(Insert amount).”

Each of the statements must be printed in a type size that is larger than the type used in any other portions of the order.

Notice on Internet Website: If the county operates an Internet Website, the following statement must be included on its home page:

“(Insert name of county) ADOPTED A TAX RATE THAT WILL RAISE MORE TAXES FOR MAINTENANCE AND OPERATIONS THAN LAST YEAR'S TAX RATE.”

If the tax rate exceeds the effective maintenance and operations rate, the following statement must appear on the county’s website home page:

“THE TAX RATE WILL EFFECTIVELY BE RAISED BY (INSERT PERCENTAGE BY WHICH THE TAX RATE EXCEEDS THE EFFECTIVE MAINTENANCE AND OPERATIONS RATE) PERCENT AND WILL RAISE TAXES FOR MAINTENANCE AND OPERATIONS ON A $100,000 HOME BY APPROXIMATELY $(Insert amount).”

For more information, please review HB 2291.