S.B. No. 2775 aims to modify the calculation of ad valorem tax rates for taxing units in Texas, particularly focusing on the voter-approval tax rate. The bill amends several sections of the Education Code and the Tax Code to clarify how tax rates should be calculated, especially in cases where a proposed tax rate exceeds the voter-approval tax rate. Key changes include the removal of certain provisions that previously applied to special taxing units and municipalities with populations under 30,000, as well as the introduction of new definitions and formulas for calculating the no-new-revenue tax rate and voter-approval tax rate.

Additionally, the bill establishes that if a school district's guaranteed funding level increases, it must reduce its tax rate accordingly and prohibits any increase in the maintenance and operations tax rate beyond specified limits. The legislation also repeals several existing provisions that are deemed unnecessary or redundant. The changes are set to take effect on January 1, 2026, and will apply to ad valorem taxes imposed for tax years beginning on or after that date.

Statutes affected:
Introduced: Education Code 48.202, Special District Local Laws Code 3828.157, Special District Local Laws Code 3828.153, Tax Code 26.04, Tax Code 26.041, Tax Code 26.063, Tax Code 26.07, Tax Code 26.075, Water Code 49.107, Water Code 49.108, Water Code 49.23602 (Water Code 49, Education Code 48, Tax Code 26, Special District Local Laws Code 3828)