88R11272 CJC-F     By: Talarico H.B. No. 3621       A BILL TO BE ENTITLED   AN ACT   relating to an exemption from ad valorem taxation of real property   used to operate a child-care facility.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter B, Chapter 11, Tax Code, is amended by   adding Section 11.36 to read as follows:          Sec. 11.36.  CHILD-CARE FACILITIES. (a)  In this section:                (1)  "Child-care facility" means a facility licensed by   the Health and Human Services Commission to provide assessment,   care, training, education, custody, treatment, or supervision for a   child who is not related by blood, marriage, or adoption to the   owner or operator of the facility, for all or part of the 24-hour   day, whether or not the facility is operated for profit or charges   for the services it offers.                (2)  "Qualifying child-care facility" means a   child-care facility that is accredited by a nationally recognized   accrediting organization for child-care or early childhood   education facilities or programs approved by the Texas Workforce   Commission and the Department of Family and Protective Services as   applying criteria for accreditation adequate to ensure the quality   of an accredited facility or program, such as the National   Association for the Education of Young Children or the National   Early Childhood Program Accreditation Commission.          (b)  Subject to Subsection (c), a person is entitled to an   exemption from taxation of:                (1)  the real property the person owns and operates as a   qualifying child-care facility; or                (2)  the portion of the real property that the person   owns and leases to a person who uses the property to operate a   qualifying child-care facility.          (c)  To qualify for the exemption authorized by this section,   the property must be:                (1)  except as provided by Subsection (d), used   exclusively to provide developmental and educational services for   children attending the child-care facility; and                (2)  reasonably necessary for the operation of the   child-care facility.           (d)  The use of exempt property for functions other than   providing developmental and educational services for children   attending the child-care facility located on the property does not   result in the loss of an exemption authorized by this section if   those other functions are incidental to the use of the property for   providing those services to those children and benefit:                (1)  those children; or                (2)  the staff and faculty of the facility.          (e)  A person who claims an exemption under Subsection (b)(2)   must include with the application for the exemption an affidavit   certifying to the chief appraiser for the appraisal district that   appraises the property that is the subject of the application that:                (1)  the person has provided to the child-care facility   to which the property is leased a disclosure document stating the   amount by which the taxes on the property are reduced as a result of   the exemption and the method the person will implement to ensure   that the rent charged for the lease of the property fully reflects   that reduction; and                (2)  the rent charged for the lease of the property   reflects the reduction in the amount of taxes on the property   resulting from the exemption through a monthly or annual credit   against the rent.          (f)  Property is not ineligible for an exemption under this   section if a portion of the property is used for functions other   than those described by Subsections (c) and (d). However, the   exemption does not apply to the value of the portion of the property   that is used for those other functions.          (g)  Section 25.07 does not apply to a leasehold interest in   property for which the owner receives an exemption under this   section.          (h)  The comptroller may adopt rules and forms necessary for   the administration of this section.          SECTION 2.  Section 11.43(c), Tax Code, is amended to read as   follows:          (c)  An exemption provided by Section 11.13, 11.131, 11.132,   11.133, 11.134, 11.17, 11.18, 11.182, 11.1827, 11.183, 11.19,   11.20, 11.21, 11.22, 11.23(a), (h), (j), (j-1), or (m), 11.231,   11.254, 11.27, 11.271, 11.29, 11.30, 11.31, 11.315, [or] 11.35, or   11.36, once allowed, need not be claimed in subsequent years, and   except as otherwise provided by Subsection (e), the exemption   applies to the property until it changes ownership or the person's   qualification for the exemption changes.  However, except as   provided by Subsection (r), the chief appraiser may require a   person allowed one of the exemptions in a prior year to file a new   application to confirm the person's current qualification for the   exemption by delivering a written notice that a new application is   required, accompanied by an appropriate application form, to the   person previously allowed the exemption.  If the person previously   allowed the exemption is 65 years of age or older, the chief   appraiser may not cancel the exemption due to the person's failure   to file the new application unless the chief appraiser complies   with the requirements of Subsection (q), if applicable.          SECTION 3.  This Act applies only to ad valorem taxes imposed   for a tax year beginning on or after the effective date of this Act.          SECTION 4.  This Act takes effect January 1, 2024, but only   if the constitutional amendment proposed by the 88th Legislature,   Regular Session, 2023, authorizing the legislature to exempt from   ad valorem taxation real property used to operate a child-care   facility is approved by the voters. If that amendment is not   approved by the voters, this Act has no effect.