87R3972 CJC-F     By: Springer S.B. No. 670       A BILL TO BE ENTITLED   AN ACT   relating to the exemption from ad valorem taxation of real property   leased to and used by certain schools.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter B, Chapter 11, Tax Code, is amended by   adding Section 11.211 to read as follows:          Sec. 11.211.  REAL PROPERTY LEASED TO CERTAIN SCHOOLS. (a)     A person is entitled to an exemption from taxation of the portion of   the real property that the person owns and leases to an   open-enrollment charter school authorized by Subchapter D, Chapter   12, Education Code, that is qualified as provided by Section   11.21(d) of this code if:                (1)  the portion of the real property that is leased to   the school is:                      (A)  used exclusively by the school for the   operation or administration of the school or the performance of   other educational functions by the school; and                      (B)  reasonably necessary for a purpose described   by Paragraph (A); and                (2)  the owner of the portion of the real property that   is leased to the school certifies by affidavit to the school that:                      (A)  if the lease agreement requires the school to   pay the taxes imposed on the real property as a portion of the total   consideration paid to the property owner under the agreement, the   owner will reduce the total consideration required to be paid by the   school under the lease agreement by an amount equal to the amount by   which the taxes on the real property are reduced as a result of the   exemption by providing a monthly or annual credit against the total   consideration due under the agreement; or                      (B)  if the lease agreement requires the school to   pay the taxes imposed on the real property directly to the collector   for the applicable taxing unit or to the owner or the property   manager separately from the payment of rent to the property owner   under the agreement, the school is no longer required to pay the   taxes to the collector, owner, or property manager, as applicable,   and the rent charged to the school under the agreement is not   affected unless a term of the agreement specifically provides for a   change in the amount of the rent.          (b)  A property owner required to provide an affidavit   described by Subsection (a)(2)(A) to an open-enrollment charter   school shall:                (1)  provide the school with a disclosure document   stating the amount by which the taxes on the real property are   reduced as a result of the exemption and the method the owner will   implement to ensure that the total consideration for the lease of   the real property fully reflects the total amount of that   reduction; and                (2)  reduce the total consideration for the lease of   the real property through a monthly or annual credit against the   total consideration to reflect the amount by which the taxes on the   real property are reduced as a result of the exemption.          (c)  This section may not be construed as invalidating an   exemption from taxation of real property granted to an   open-enrollment charter school on the basis of Section 12.128,   Education Code, before January 1, 2022.           (d)  Section 25.07 does not apply to a leasehold interest in   real property for which the owner receives an exemption under this   section.          SECTION 2.  This Act applies only to ad valorem taxes imposed   for a tax year beginning on or after the effective date of this Act.          SECTION 3.  This Act takes effect January 1, 2022, but only   if the constitutional amendment proposed by the 87th Legislature,   Regular Session, 2021, authorizing the legislature to exempt from   ad valorem taxation real property leased to certain schools   organized and operated primarily for the purpose of engaging in   educational functions is approved by the voters. If that amendment   is not approved by the voters, this Act has no effect.