H.B. No. 378 proposes an increase in the exemption amount for residence homesteads from ad valorem taxation by school districts, raising the exemption from $100,000 to $200,000. This change is intended to provide financial relief to homeowners while ensuring that school districts are protected from revenue losses resulting from this increased exemption. The bill includes provisions for additional state aid to school districts starting in the 2026-2027 school year, which will help offset any revenue shortfalls caused by the increased exemption.

The bill also outlines specific amendments to the Texas Tax Code and Education Code, including the introduction of new subsections that detail how state aid will be calculated based on local revenue losses. It stipulates that the additional state aid will be available if the revenue used to service eligible debt is less than what would have been available under previous laws prior to the exemption increase. The act is set to take effect on January 1, 2026, contingent upon voter approval of a related constitutional amendment proposed by the 89th Legislature.

Statutes affected:
Introduced: Tax Code 11.13, Education Code 11.301, Education Code 48.2543 (Education Code 48, Education Code 11, Tax Code 11)