Agenda

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Item # 19.

Work Session and Regular Meeting

Meeting Date:	07/14/2020
Department:	Finance
Pillars:	Gold Standard in Financial Health
Milestones:	Continuously improve processes and policies to include the voice of the customer and ensure the policies are easily accessible

AGENDA CAPTION:

Present, Discuss and Consider Action on a Resolution Directing the City Manager to Calculate the Voter-Approval Tax Rate of the Town of Addison in the Manner Provided for a Special Taxing Unit as Authorized by the Texas Tax Code Section 26.04(C-1).

BACKGROUND:

Senate Bill 2 (S.B. 2), the Texas Property Tax Reform and Transparency Act of 2019 lowered the amount an adopted tax rate can increase. Prior to this tax bill, any rate adopted that exceeded an 8 percent increase over the prior year's rate, would trigger the ability of the citizens to petition for an election to "roll back" the tax rate. S.B. 2 has lowered this triggered rate from 8 percent to 3.5 percent and requires a city to hold an automatic election (Texas Tax Code 26.07).

An exception to the lowered 3.5 percent voter-approval rate and the automatic election is offered when the city is located in an area declared a disaster area during the current tax year by the Governor or by the President of the United States (Texas Tax Code 26.04(C-1). This exception was met on March 13, 2020, when President Trump declared a national emergency and when Governor Abbott declared a state of emergency for every county in Texas the same day. If directed by the City Council, the Town will calculate the voter-approval rate in the manner provided for a special taxing unit, which returns the increased potential to the 8 percent.

Further, the designated officer may continue calculating the voter-approval tax rate for the Town of Addison in the manner provided by this subsection until the earlier of the following:

(1) The second tax year in which the total taxable value of the taxable property as shown on the appraisal roll for the Town of Addison exceeds the total taxable value of the taxable property on January 1 of the tax year in which the disaster occurred; or
(2) The third tax year after the tax year in which the disaster occurred.

RECOMMENDATION:

Administration recommends approval.

Attachments
Resolution - Disaster Tax Rate Calculation