H.B. No. 2894 aims to provide state aid to local governments that are disproportionately affected by the ad valorem tax relief granted to disabled veterans. The bill amends Section 140.011 of the Local Government Code, redefining "local government" to include municipalities and counties without the previous requirement of being adjacent to or containing a United States military installation. Additionally, it establishes criteria for local governments to qualify for disabled veteran assistance payments based on the percentage of lost ad valorem tax revenue relative to their general fund revenue.

The bill specifies that a local government is eligible for assistance if the lost revenue is at least 2% of its general fund revenue for municipalities adjacent to military installations or counties containing them, and 10% for certain municipalities and counties with specific population criteria. The changes will take effect starting with the fiscal year ending in the 2025 tax year, and the act is set to become effective on September 1, 2025.

Statutes affected:
Introduced: Local Government Code 140.011 (Local Government Code 140)
House Committee Report: Local Government Code 140.011 (Local Government Code 140)
Engrossed: Local Government Code 140.011 (Local Government Code 140)
Senate Committee Report: Local Government Code 140.011 (Local Government Code 140)
Enrolled: Local Government Code 140.011 (Local Government Code 140)