The bill 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 increase aims to provide additional state aid to school districts that may face revenue losses due to the exemption. The bill outlines provisions for this additional state aid for the 2023-2024, 2024-2025, and 2025-2026 school years, ensuring that districts are compensated for any local revenue shortfalls resulting from the increased homestead exemption. It also includes amendments to the Education Code, introducing new subsections that clarify the conditions for receiving this aid and establishing transitional provisions for affected districts.

Additionally, the bill introduces amendments to the Education and Tax Codes, focusing on property tax assessments and procedures for the 2025 tax year. It mandates the commissioner to manage property detachments and annexations promptly following the vote on the proposed constitutional amendment and requires the chief appraiser to prepare supplemental appraisal records reflecting the changes. The bill also outlines the process for provisional tax bills for the 2025 tax year, which will indicate potential tax amounts based on the previous laws. If the constitutional amendment is approved, these provisional bills will become final; otherwise, supplemental tax bills will be issued. The bill's effective date depends on a two-thirds vote from both houses, with a fallback date of September 1, 2025, if necessary.

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 (Education Code 11, Education Code 49, Education Code 46, Tax Code 25, Education Code 48, Tax Code 26, Tax Code 11, Tax Code 31)