H.B. No. 250, introduced by Isaac, seeks to amend the calculation of ad valorem tax rates for taxing units in Texas, focusing on the process for approving tax rates that exceed the voter-approval tax rate. The bill deletes Sections 26.042 and 26.075 from the Tax Code, which are no longer applicable to taxes imposed under certain sections of the Special District Local Laws Code. It introduces new definitions and formulas for calculating the "no-new-revenue tax rate" and "voter-approval tax rate," ensuring these calculations reflect changes in property values and sales tax revenues. Additionally, the bill enhances transparency by modifying public hearing and notification requirements regarding proposed tax rates, mandating that an election be held if a taxing unit adopts a rate above the voter-approval threshold.

The bill also amends the Water Code to refine the calculation of the voter-approval tax rate, changing the heading of Section 49.23601 to focus on automatic elections for tax rate approval and updating the definition of "voter-approval tax rate" to remove the previous cap on operation and maintenance tax rates. If a district's adopted tax rate exceeds the newly defined voter-approval tax rate, an election must be held for approval, with a fallback to the voter-approval rate if not approved. The legislation also repeals several unnecessary sections from the Education Code, Local Government Code, and Tax Code, with the changes set to take effect for tax years beginning on or after January 1, 2026.

Statutes affected:
Introduced: Special District Local Laws Code 3828.157, Special District Local Laws Code 8876.152, Tax Code 26.04, Tax Code 26.041, Tax Code 26.07, Tax Code 31.112, Water Code 6.30, Water Code 49.107, Water Code 49.108, Water Code 49.236, Water Code 49.23601 (Water Code 49, Water Code 6, Tax Code 31, Special District Local Laws Code 8876, Special District Local Laws Code 3828, Tax Code 26)