Current through Reg. 49, No. 38; September 20, 2024
(a) General
provisions. This section implements the Texas Education Code (TEC),
§48.254 (Additional State Aid for Ad Valorem Tax Credits Under Texas
Economic Development Act). In accordance with the TEC, §
48.254, a school
district, including a school district that is otherwise ineligible for state
aid under the TEC, Chapter 48 , is entitled to state aid in an amount equal to
the amount of all tax credits applied against ad valorem taxes of the school
district in each year that tax credits were applied pursuant to the Texas Tax
Code, Chapter 313, also known as the Texas Economic Development Act. School
districts eligible to receive additional state aid under the TEC, §
48.254, must apply to
the commissioner of education in order to receive additional state aid equal to
the qualifying ad valorem tax credits issued under the Texas Tax Code, Chapter
313, Subchapter D, as that subchapter existed prior to repeal by House Bill
(HB) 3390, 83rd Texas Legislature, Regular Session, 2013, subject to certain
annual limitations.
(b)
Definitions. The following phrases, words, and terms, when used in this
section, will have the following meanings, unless the context clearly indicates
otherwise.
(1) Eligible property--A term that
has the meaning assigned in the Texas Tax Code, §
313.024.
(2) Limitation on appraised value--A term
that has the meaning assigned in the Texas Tax Code, Chapter 313. A school
district may limit the appraised value on a qualified property for the purposes
of ad valorem taxation for a period of eight tax years, beginning with the tax
year that follows the applicable two-year qualifying time period. A limitation
on appraised value applies only to the maintenance and operations portion of a
school district's ad valorem tax rate. For each tax year in which the
limitation on appraised value is in effect, the appraised value of the
qualified property that is described in the written agreement between the
school district and taxpayer for school district maintenance and operations ad
valorem tax may not exceed the lesser of the market value of the property or
the amount to which the school district has agreed, but the limited amount must
be at least the minimum amount of limitation that is set for the applicable
school district category in the Texas Tax Code, Chapter 313.
(3) Qualified property--A term that has the
meaning assigned in the Texas Tax Code, §
313.021(2).
(4) Tax credit--A credit that is made to a
taxpayer who has applied for and received a limitation on appraised value under
the Texas Tax Code, Chapter 313, from the school district that approved the
limitation in an amount equal to the amount of ad valorem taxes paid to that
school district that were imposed on the portion of the appraised value of the
qualified property that exceeds the amount of the limitation agreed to by the
governing body of the school district under the Texas Tax Code, §
313.027(a)(2),
in each year in the applicable qualifying time period.
(5) Tax year--The calendar year beginning
January 1 in which the taxpayer incurred ad valorem taxes on the qualified
property for which the taxpayer is entitled to a tax credit toward ad valorem
taxes paid in that tax year.
(6)
Texas Economic Development Act--The Texas Tax Code, Chapter 313.
(c) Eligibility for additional
state aid.
(1) A school district may be
eligible for additional state aid under the TEC, §
48.254, only pursuant
to the provisions of the TEC, §
48.254, and the Texas
Tax Code, Chapter 313.
(2) A school
district must file an application on a form prescribed by the commissioner in
accordance with the applicable timeline as described in subsection (i) of this
section. A separate application must be made for each tax year for which
additional state aid is being requested. An application, including the required
supporting documentation described in subsections (d)(2) and (d)(3) of this
section, as applicable, must be complete in order for the Texas Education
Agency (TEA) to process it.
(3) A
school district must be in compliance with the reporting requirements set forth
in 34 Texas Administrative Code Chapter 9, Subchapter F (relating to Limitation
on Appraised Value on Certain Qualified Property), to be eligible for
additional state aid under the TEC, §
48.254.
(d) Procedures for filing request
for additional state aid for ad valorem tax credits.
(1) Method of filing. All requests for
additional state aid under the TEC, §
48.254, must be filed
electronically with the TEA in accordance with instructions on the
application.
(2) Information
required for first year of tax credit. A school district's initial request for
additional state aid under the TEC, §
48.254, must include:
(A) a completed Request for Additional State
Aid for Ad Valorem Tax Credit application form, including the template that
comprises a component of the application showing requested and projected
additional state aid for each agreement under the Texas Tax Code, Chapter
313;
(B) a copy of the taxpayer's
application to the school district for the tax credit, together with all
required attachments to the application;
(C) a copy of the school board's resolution
or other proof that the school district has approved the taxpayer's application
for the tax credit;
(D) a copy of
the tax bill sent to the taxpayer (showing the taxes imposed are net of the tax
credit); and
(E) confirmation that,
as of the date of the tax credit approval, the taxpayer has not relocated its
business outside of the school district.
(3) Information required for subsequent years
of tax credit. For each year subsequent to the year in which the initial
request for the tax credit was approved, the request for additional state aid
under the TEC, §
48.254, must include:
(A) a completed Request for Additional State
Aid for Ad Valorem Tax Credit application form, including the template that
comprises a component of the application showing requested and projected
additional state aid for each agreement under the Texas Tax Code, Chapter
313;
(B) a copy of the tax bill
sent to the taxpayer (showing the taxes imposed are net of the tax credit);
and
(C) confirmation that, as of
the date of the tax credit approval, the taxpayer has not relocated its
business outside of the school district.
(e) Forms. The division of the TEA
responsible for state funding will make available the application form,
including the template, required under subsections (d)(2) and (d)(3) of this
section.
(f) Limitation of tax
credit. In the fourth through the tenth years in which the agreement described
in subsection (b)(2) of this section is in effect, the tax credit is limited to
50% of the total maintenance and operations and interest and sinking fund taxes
imposed on the qualified property for the tax year for which the credit
applies.
(g) Determination of
additional state aid. For any tax year for which additional state aid
authorized by the TEC, §
48.254, is approved,
additional state aid will be limited to the amount of the tax credit due to the
taxpayer for a qualified property that is receiving a limitation on appraised
value for that year as determined in the Texas Tax Code, §
313.104, as that section
existed prior to the repeal of the Texas Tax Code, Chapter 313, Subchapter D,
by HB 3390, 83rd Texas Legislature, Regular Session, 2013.
(h) Erroneous tax credits and recovery of
state aid for erroneous tax credits. If the comptroller of public accounts or
the governing body of the school district determines that an entity that
received a tax credit was ineligible to have received it or received more
credit than the entity should have received, the school district must provide a
notification of the facts to the commissioner within 30 days of the official
action. If the TEA determines that an entity that received a tax credit was
ineligible to have received it or received more credit than the entity should
have received, the commissioner will notify the school district within 30 days
of the determination. Any overpayment of additional state aid provided to the
school district based on issuance of an erroneous tax credit by the school
district will be fully recovered by the TEA pursuant to the TEC, §
48.272.
(i) Timeline for submission of application
requests. The school district must submit its application for additional state
aid for ad valorem tax credits on or before May 31 each year for which the tax
credit is due.
(j) Payment to the
school district. On approval of a school district's application for additional
state aid for ad valorem tax credits by the commissioner, the amount of the
credit will be applied to the entitlement due to the school district (as soon
as practicable after the application is approved).
