S.B. No. 4 proposes to increase the exemption amount for residence homesteads from ad valorem taxation by school districts from $100,000 to $140,000, contingent upon a constitutional amendment. This change will take effect for ad valorem tax years beginning on or after January 1, 2025. The bill also provides for additional state aid to school districts that may experience revenue losses due to the increased exemption, specifically for the 2023-2024 and 2024-2025 school years. The aid will be available if a district's local revenue for servicing debt falls below what would have been available under previous laws, with new subsections detailing the conditions for calculating and distributing this aid.

Moreover, the bill includes provisions that allow school districts to use the additional state aid solely for paying the principal and interest on bonds. It establishes transitional measures for affected districts, including adjustments to maximum compressed rates and election processes related to local revenue levels. The bill amends various sections of the Education and Tax Codes to implement these changes, introducing new subsections for provisional appraisal rolls and tax calculations based on anticipated changes from S.B. 4, which will take effect if a related constitutional amendment is approved. The bill also outlines the management of property detachments and annexations for the 2025-2026 school year and mandates clear statements on tax bills regarding the potential impact of the proposed legislation. The effective date of the bill is contingent upon a two-thirds vote from both houses or will take effect on September 1, 2025, if not.

Statutes affected:
Introduced: Tax Code 11.13, Education Code 11.301, Education Code 48.2543, Education Code 48.2542, Education Code 46.071, Education Code 48.2551, Education Code 48.283, Education Code 49.004, Education Code 49.154, Education Code 49.308, Tax Code 25.23, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 31, Education Code 46, Tax Code 11, Education Code 49, Education Code 11, Tax Code 26, Education Code 48, Tax Code 25)
Senate Committee Report: Tax Code 11.13, Education Code 11.301, Education Code 48.2543, Education Code 48.2542, Education Code 46.071, Education Code 48.2551, Education Code 48.283, Education Code 49.004, Education Code 49.154, Education Code 49.308, Tax Code 25.23, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 31, Education Code 46, Tax Code 11, Education Code 49, Education Code 11, Tax Code 26, Education Code 48, Tax Code 25)
Engrossed: Tax Code 11.13, Education Code 11.301, Education Code 48.2543, Education Code 46.071, Education Code 48.2551, Education Code 48.283, Education Code 49.004, Education Code 49.154, Education Code 49.308, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 31, Education Code 46, Tax Code 11, Education Code 49, Education Code 11, Tax Code 26, Education Code 48, Tax Code 25)
House Committee Report: Tax Code 11.13, Education Code 11.301, Education Code 48.2543, Education Code 46.071, Education Code 48.2551, Education Code 48.283, Education Code 49.004, Education Code 49.154, Education Code 49.308, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 31, Education Code 46, Tax Code 11, Education Code 49, Education Code 11, Tax Code 26, Education Code 48, Tax Code 25)
Enrolled: Tax Code 11.13, Education Code 11.301, Education Code 48.2543, Education Code 46.071, Education Code 48.2551, Education Code 48.283, Education Code 49.004, Education Code 49.154, Education Code 49.308, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 31, Education Code 46, Tax Code 11, Education Code 49, Education Code 11, Tax Code 26, Education Code 48, Tax Code 25)