HBA-GUM S.B. 1401 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 1401 By: Nixon, Drew Ways & Means 5/5/1999 Engrossed BACKGROUND AND PURPOSE Current law prohibits taxpayers from making an effective inequality of appraisal argument, under Chapter 41 (Local Review), Tax Code before an administrative or appraisal review board. The 75th Texas Legislature added statutory language was added to Chapter 42 (Judicial Review), Tax Code, to allow taxpayers to assert an inequality of appraisal argument at the district court level. S.B. 1401 allows taxpayers to make the same inequality of appraisal argument before an appraisal review board and district court. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 41.43, Tax Code, as follows: (a) Provides that Subsection (b) is an exception to this subsection, which relates to an appraisal district's burden of establishing the value of a certain property. (b) Requires a protest on the ground of unequal appraisal of property to be determined in favor of the appraisal district unless the protesting party, rather than in favor of the protesting party unless the appraisal district, establishes that the appraisal ratio of the property is greater, rather than not greater, than the median level of appraisal of a reasonable and representative sample of certain specified properties. Makes conforming changes. (c) Provides that, for purposes of this section (Protest of Determination of Value or Inequality of Appraisal), the value of the property subject to the protest and the value of a comparable property or sample property that is used for comparison must be the market value determined by the appraisal district when the property is a residence homestead subject to the limitation on appraised value imposed by Section 23.23 (Limitation on Appraised Value of Residence Homestead). SECTION 2. Amends Sections 42.26(a), (b), and (d), Tax Code, as follows: (a) Adds language to require the district court (court) to grant relief on the ground that a property is appraised unequally, if the appraisal ratio of the property exceeds by at least 10 percent the median level of appraisal of a sample of properties in the appraisal district, or the appraised value of the property exceeds the median appraised value of a reasonable number of comparable properties appropriately adjusted. Makes conforming changes. (b) Requires the court to order the property's appraised value changed to the value calculated on the basis of the median level of appraisal according to Subsection (a)(3) (relating to the appropriately adjusted appraised value of a reasonable number of comparable properties), if a property owner is entitled to relief under that subsection. Makes conforming and nonsubstantive changes. (d) Provides that, for purpose of this section, the value of the property subject to the suit and the value of a comparable property or sample property that is used for comparison must be the market value determined by the appraisal district when the property is a residence homestead subject to the limitation on appraised value imposed by Section 23.23. Deletes text requiring the district to grant relief on the ground that property is appraised unequally if the value of the property exceeds the median appraised value. SECTION 3. Effective date: September 1, 1999. Makes application of this Act prospective. SECTION 4. Emergency clause.