H.B. No. 2491




AN ACT
relating to the administration and collection of ad valorem taxes, including the transfer of an ad valorem tax lien and a contract for foreclosure of an ad valorem tax lien; amending, correcting, and clarifying the Tax Code, Property Code, and Civil Practice and Remedies Code. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 1.07(b), Tax Code, is amended to read as follows: (b) The official or agency shall address the notice to the property owner, the person designated under Section 1.111(f) to receive the notice for the property owner, if that section applies, or, if appropriate, the property owner's agent at the agent's [his] address according to the most recent record in the possession of the official or agency. However, if a property owner files a written request with the appraisal district that notices be sent to a particular address, the official or agency shall send the notice to the address stated in the request. SECTION 2. Section 1.11(b), Tax Code, is amended to read as follows: (b) To be effective, a [A] request made under [pursuant to] this section must be filed with the appraisal district. A request remains in effect until revoked by a written revocation filed with the appraisal district by the owner. SECTION 3. Section 11.43, Tax Code, is amended by adding Subsections (l) and (m) to read as follows: (l) The form for an application under Section 11.13 must include a space for the applicant to state the applicant's date of birth. Failure to provide the date of birth does not affect the applicant's eligibility for an exemption under that section, other than an exemption under Section 11.13(c) or (d) for an individual 65 years of age or older. (m) Notwithstanding Subsections (a) and (k), a person who receives an exemption under Section 11.13, other than an exemption under Section 11.13(c) or (d) for an individual 65 years of age or older, in a tax year is entitled to receive an exemption under Section 11.13(c) or (d) for an individual 65 years of age or older in the next tax year on the same property without applying for the exemption if the person becomes 65 years of age in that next year as shown by information in the records of the appraisal district that was provided to the appraisal district by the individual in an application for an exemption under Section 11.13 on the property or in correspondence relating to the property. This subsection does not apply if the chief appraiser determines that the individual is no longer entitled to any exemption under Section 11.13 on the property. SECTION 4. Section 22.28, Tax Code, is amended by amending Subsection (b) and adding Subsection (c) to read as follows: (b) The chief appraiser shall certify to the assessor for each taxing unit participating in the appraisal district that imposes taxes on the property that the chief appraiser has imposed [may retain a portion of] a penalty [collected] under this section[, not to exceed 20 percent of the amount of the penalty, to cover the chief appraiser's costs of collecting the penalty]. The assessor [chief appraiser] shall add the amount of the penalty to the original amount of tax imposed on the property and shall include that amount in the tax bill for that year. The penalty becomes part of the tax on the property and is secured by the tax lien that attaches to the property under Section 32.01 [distribute the remainder of the penalty to each taxing unit participating in the appraisal district that imposes taxes on the property in proportion to the taxing unit's share of the total amount of taxes imposed on the property by all taxing units participating in the district]. (c) To help defray the costs of administering this chapter, a collector who collects a penalty imposed under Subsection (a) shall remit to the appraisal district that employs the chief appraiser who imposed the penalty an amount equal to five percent of the penalty amount collected. SECTION 5. Subchapter B, Chapter 23, Tax Code, is amended by adding Section 23.225 to read as follows: Sec. 23.225. APPRAISAL OF LAND INCLUDED IN HABITAT PRESERVE AND SUBJECT TO CONSERVATION EASEMENT. (a) In this section, "endangered species," "federal permit," and "habitat preserve" have the meanings assigned by Section 83.011, Parks and Wildlife Code. (b) In appraising land that is included in a habitat preserve and is subject to a conservation easement created under Chapter 183, Natural Resources Code, or other law that restricts the use of the land to protect an endangered species under a federal permit, the chief appraiser shall consider the effect of the restriction on the value of the land. SECTION 6. Section 23.51(3), Tax Code, is amended to read as follows: (3) "Category" means the value classification of land considering the agricultural use to which the land is principally devoted. The chief appraiser shall determine the categories into which land in the appraisal district is classified. In classifying land according to categories, the chief appraiser shall distinguish between [Categories of land may include but are not limited to] irrigated cropland, dry cropland, improved pasture, native pasture, orchard, and waste. The chief appraiser may establish additional categories. The chief appraiser shall [and may be] further divide each category [divided] according to soil type, soil capability, irrigation, general topography, geographical factors, and other factors that [which] influence the productive capacity of the category. The chief appraiser shall obtain information from the Texas Agricultural [Agriculture] Extension Service, the Natural Resources [Soil] Conservation Service of the United States Department of Agriculture, and other recognized agricultural sources for the purposes of determining the categories of land [production] existing in the appraisal district. SECTION 7. Section 25.25(d), Tax Code, is amended to read as follows: (d) At any time prior to the date the taxes become delinquent, a property owner or the chief appraiser may file a motion with the appraisal review board to change the appraisal roll to correct an error that resulted in an incorrect appraised value for the owner's property. However, the error may not be corrected unless it resulted in an appraised value that exceeds by more than one-third the correct appraised value. If the appraisal roll is changed under this subsection, the property owner must pay to each affected taxing unit a late-correction penalty equal to 10 percent of the amount of taxes as calculated on the basis of the corrected appraised value. Payment of the late-correction penalty is secured by the lien that attaches to the property under Section 32.01 and is subject to enforced collection under Chapter 33. The roll may not be changed under this subsection if: (1) the property was the subject of a protest brought by the property owner under Chapter 41, a hearing on the protest was conducted in which the property owner offered evidence or argument, and the appraisal review board made a determination of the protest on the merits; or (2) the appraised value of the property was established as a result of a written agreement between the property owner or the owner's agent and the appraisal district. SECTION 8. Section 26.11(c), Tax Code, is amended to read as follows: (c) If the amount of prorated taxes determined to be due as provided by this section is tendered to the collector for the unit, the collector [he] shall accept the tender. The payment absolves: (1) the transferor of liability for taxes by the unit on the property for the year of the transfer; and (2) the taxing unit of liability for a refund in connection with taxes on the property for the year of the transfer. SECTION 9. Section 31.05(a), Tax Code, is amended to read as follows: (a) The governing body of a taxing unit [that collects its own taxes] may adopt the discounts provided by Subsection (b) or Subsection (c) [of this section], or both, in the manner required by law for official action by the body. The discounts, if adopted, apply only to that taxing unit's taxes [for a taxing unit for which the adopting taxing unit collects taxes if the governing body of the other unit, in the manner required by law for official action by the body, adopts the discounts or approves of their application to its taxes by the collecting unit]. If a taxing unit adopts both discounts under Subsections (b) and (c) [of this section], the discounts adopted under Subsection (b) apply unless the [unit mails its] tax bills for the unit are mailed after September 30, in which case only the discounts under Subsection (c) apply. A taxing unit that collects taxes for another taxing unit that adopts the discounts may prepare and mail separate tax bills on behalf of the adopting taxing unit and may charge an additional fee for preparing and mailing the separate tax bills and for collecting the taxes imposed by the adopting taxing unit. If under an intergovernmental contract a county assessor-collector collects taxes for a taxing unit that adopts the discounts, the county assessor-collector may terminate the contract if the county has adopted a discount policy that is different from the discount policy adopted by the adopting taxing unit. SECTION 10. Section 31.073, Tax Code, is amended to read as follows: Sec. 31.073. RESTRICTED OR CONDITIONAL PAYMENTS PROHIBITED. A restriction or condition placed on a check in payment of taxes, penalties, or interest by the maker that limits the amount of taxes, penalties, or interest owed to an amount less than that stated in the tax bill or shown by the tax collector's records is void unless the restriction or condition is authorized by this code. SECTION 11. Section 31.08(a), Tax Code, is amended to read as follows: (a) At the request of any person, a collector for a taxing unit shall issue a certificate showing the amount of delinquent taxes, penalties, [and] interest, and any known costs and expenses under Section 33.48 due the unit on a property according to the unit's current tax records. If the collector collects taxes for more than one taxing unit, the certificate must show the amount of delinquent taxes, penalties, [and] interest, and any known costs and expenses under Section 33.48 due on the property to each taxing unit for which the collector collects the taxes. The collector shall charge a fee not to exceed $10 for each certificate issued. The collector shall pay all fees collected under this section into the treasury of the taxing unit that employs the collector [him]. SECTION 12. Section 32.05, Tax Code, is amended by amending Subsections (b) and (c) and adding Subsections (b-1), (d), and (e) to read as follows: (b) Except as provided by Subsection (c)(1) [(c) of this section], a tax lien provided by this chapter takes priority over: (1) the claim of any creditor of a person whose property is encumbered by the lien; (2) [and over] the claim of any holder of a lien on property encumbered by the tax lien, including any lien held by a property owners' association, homeowners' association, condominium unit owners' association, or council of owners of a condominium regime under a restrictive covenant, condominium declaration, master deed, or other similar instrument that secures regular or special maintenance assessments, fees, dues, interest, fines, costs, attorney's fees, or other monetary charges against the property; and (3) any right of remainder, right or possibility of reverter, or other future interest in, or encumbrance against, the property, whether vested or contingent [not the debt or lien existed before attachment of the tax lien]. (b-1) The priority given to a tax lien by Subsection (b) prevails, regardless of whether the debt, lien, future interest, or other encumbrance existed before attachment of the tax lien. (c) A tax lien provided by this chapter is inferior to [a claim]: (1) a claim for any survivor's allowance, funeral expenses, or expenses of the last illness of a decedent made against the estate of a decedent as provided by law; (2) except as provided by Subsection (b)(2), [under] a recorded restrictive covenant that runs [running] with the land and was[, other than a restrictive covenant in favor of a property owners' association or homeowners' association] recorded before January 1 of the year the tax lien arose; or (3) [under] a valid easement of record recorded before January 1 of the year the tax lien arose. (d) In an action brought under Chapter 33 for the enforced collection of a delinquent tax against property, a property owners' association, homeowners' association, condominium unit owners' association, or council of owners of a condominium regime that holds a lien for regular or special maintenance assessments, fees, dues, interest, fines, costs, attorney's fees, or other monetary charges against the property is not a necessary party to the action unless, at the time the action is commenced, notice of the lien in a liquidated amount is evidenced by a sworn instrument duly executed by an authorized person and recorded with the clerk of the county in which the property is located. A tax sale of the property extinguishes the lien held by a property owners' association, homeowners' association, condominium unit owners' association, or council of owners of a condominium regime for all amounts that accrued before the date of sale if: (1) the holder of the lien is joined as a party to an action brought under Chapter 33 by virtue of a notice of the lien on record at the time the action is commenced; or (2) the notice of lien is not of record at the time the action is commenced, regardless of whether the holder of the lien is made a party to the action. (e) The existence of a recorded restrictive covenant, declaration, or master deed that generally provides for the lien held by a property owners' association, homeowners' association, condominium unit owners' association, or council of owners of a condominium regime does not, by itself, constitute actual or constructive notice to a taxing unit of a lien under Subsection (d). SECTION 13. Section 32.06, Tax Code, is amended to read as follows: Sec. 32.06. TRANSFER OF TAX LIEN. (a) In this section: (1) "Mortgage servicer" has the meaning assigned by Section 51.0001, Property Code. (2) "Transferee" means a person authorized to pay the taxes of another. (a-1) A person may authorize another person to pay the delinquent taxes imposed by a taxing unit on the person's real property by filing with the collector for the unit a sworn document stating: (1) the authorization; (2) the name and street address of the transferee[, naming the other person] authorized to pay the taxes of the property owner; and (3) a description of[, and describing] the property by street address, if applicable, and legal description. (a-2) After a tax lien is transferred, taxes on the property that become due in subsequent tax years may be transferred before the delinquency date in the manner provided by Subsection (a-1). (a-3) A tax lien may be transferred before the delinquency date in the manner provided by Subsection (a-1) only if the real property is not subject to a lien other than the tax lien. (b) If a transferee [person] authorized to pay a property owner's [another's] taxes pursuant to Subsection (a-1) [(a)] pays the taxes and any penalties and interest imposed, the collector shall issue a tax receipt to that transferee [the person paying the taxes]. In addition, the collector or a person designated by the collector shall certify on the sworn document that payment of the taxes and any penalties and interest on the described property and collection costs has been made by the transferee on behalf of the property owner [a person other than the person] liable for the taxes when imposed and that the taxing unit's tax lien is transferred to that transferee [the person paying the taxes]. The collector shall attach to the sworn document the collector's seal of office or sign the document before a notary public and deliver the sworn document, a tax receipt, and the affidavit attesting to the transfer of the tax lien to the transferee within 30 days [person paying the taxes]. The sworn document, tax receipt, and affidavit attesting to the transfer of the tax lien may be combined into one document. The collector shall conspicuously identify in the applicable taxpayer's account the date of the transfer of a tax lien transferred under this section [keep a record of all tax liens transferred as provided by this section]. (c) Except as otherwise provided by this section, the transferee of a tax lien and any successor in interest is entitled to foreclose the lien: (1) in the manner provided by law for foreclosure of tax liens; or (2) in the manner specified in Section 51.002, Property Code, and Section 32.065 of this code, if the property owner and the transferee enter into a contract that is secured by a lien on the property. (d) To be enforceable, a tax lien transferred as provided by this section must be recorded with the sworn statement and affidavit attesting to the transfer of the tax lien as described in Subsection (b) in the deed records of each county in which the property encumbered by the lien is located. (e) A transferee [person] holding a tax lien transferred as provided by this section may not charge a greater rate of interest than 18 percent a year on the funds advanced. Funds advanced are limited to the taxes, penalties, interest, and collection costs paid as shown on the tax receipt, expenses paid to record the lien, plus reasonable closing costs [recording expenses paid to acquire and record the lien]. (f) The mortgage servicer [holder] of a preexisting lien on property encumbered by a tax lien transferred as provided by Subsection (b) [this section] is entitled, within six months after the date on which the tax lien is recorded in all counties in which the property is located, to obtain a release of the transferred tax lien by paying [pay] the transferee [holder] of the tax lien the amount owed under the contract between the property owner and the transferee. A transferee may charge a reasonable fee for a payoff statement that is requested after an initial payoff statement is provided. (g) At any time after the end of the six-month period specified by Subsection (f) and before a notice of foreclosure of the transferred tax lien is sent, the transferee of the tax lien or the holder of the tax lien may require the property owner to provide written authorization and pay a reasonable fee before providing information regarding the current balance owed by the property owner to the transferee or the holder of the tax lien. (h) A mortgage servicer who pays a transferred tax lien [paid for the lien, plus interest accrued at the rate provided by Subsection (e) and recording expenses, and] becomes subrogated to all rights in the lien. (i) [(g)] A foreclosure of [suit to foreclose] a tax lien transferred as provided by this section may not be instituted within one year from the date on which the lien is recorded in all counties in which the property is located, unless the contract between the owner of the property and the transferee provides otherwise. (j) [(h)] After one year from the date on which a tax lien transferred as provided by this section is recorded in all counties in which the property is located, the transferee [holder] of the lien may [file suit to] foreclose the lien in the manner provided by Subsection (c) unless a contract between the holder of the lien and the owner of the property encumbered by the lien provides otherwise. If a foreclosure [the] suit results in foreclosure of the lien, the transferee [person filing suit] is entitled to recover attorney's fees in an amount not to exceed 10 percent of the judgment. The proceeds of a sale following a judicial foreclosure as provided by this subsection shall be applied first to the payment of court costs, then to payment of the judgment, including accrued interest, and then to the payment of any attorney's fees fixed in the judgment. Any remaining proceeds shall be paid to other holders of liens on the property in the order of their priority and then to the person whose property was sold at the tax sale. (k) Beginning on the date the foreclosure deed is recorded, the [(i) The] person whose property is sold as provided by Subsection (c) [this section] or the mortgage servicer of [any person holding] a prior recorded [first] lien against the property is entitled[, within one year after the date the property is sold,] to redeem the foreclosed property from the purchaser [at the tax sale] by paying the [that] purchaser or successor 125 [the tax sale purchase price, plus costs, and interest accrued on the judgment to the date of redemption or 118] percent of the purchase price during the first year of the redemption period or 150 percent of the purchase price during the second year of the redemption period with cash or cash equivalent funds. The right of redemption may be exercised on or before the second anniversary of the date on which the purchaser's deed is filed of record if the property sold was the residence homestead of the owner, was land designated for agricultural use, or was a mineral interest. For any other property, the right of redemption must be exercised not later than the 180th day after the date on which the purchaser's deed is filed of record [amount of the judgment, whichever is less]. If a person redeems the property as provided by this subsection, the purchaser at the tax sale shall deliver a deed to the property to the person redeeming the property. If the person who owned the property at the time of foreclosure redeems the property, all liens existing on the property at the time of the tax sale remain in effect to the extent not paid from the sale proceeds. SECTION 14. Section 32.065, Tax Code, is amended by amending Subsections (a), (b), (c), (d), and (f) and adding Subsections (b-1) and (g) to read as follows: (a) Section 32.06 does not abridge the right of an owner of real property to enter into a contract for the payment of taxes [with the holder of a lien on the property, including a transferee under Section 32.06 or this section, or affect a contract between the owner and holder of a lien for the payment of taxes on the property]. (b) Notwithstanding any agreement to the contrary, a [A] contract entered into under Subsection (a) between a transferee and the property owner under Section 32.06 that is secured by a priority lien on the property shall [may] provide for a power of sale and foreclosure under Chapter 51, Property Code, and: (1) an event of default; [and] (2) notice of acceleration; (3) recording of the contract in each county in which the property is located; (4) recording of the sworn document and affidavit attesting to the transfer of the tax lien; (5) requiring the transferee to serve foreclosure notices on the property owner at the property owner's last known address in the manner required by Sections 51.002(b), (d), and (e), Property Code, or by a commercially reasonable delivery service that maintains verifiable records of deliveries for at least five years from the date of delivery; and (6) requiring, at the time the foreclosure notices required by Subdivision (5) are served on the property owner, the transferee to serve a copy of the notice of sale in the same manner on the mortgage servicer or the holder of all recorded real property liens encumbering the property that includes on the first page, in 14-point boldfaced type or 14-point uppercase typewritten letters, a statement that reads substantially as follows: "PURSUANT TO TEXAS TAX CODE SECTION 32.06, THE FORECLOSURE SALE REFERRED TO IN THIS DOCUMENT IS A SUPERIOR TRANSFER TAX LIEN SUBJECT TO RIGHT OF REDEMPTION UNDER CERTAIN CONDITIONS. THE FORECLOSURE IS SCHEDULED TO OCCUR ON THE (DATE)." (b-1) On an event of default and notice of acceleration, the mortgage servicer of a recorded lien encumbering real property may obtain a release of a transferred tax lien on the property by paying the transferee of the tax lien or the holder of the tax lien the amount owed by the property owner to that transferee or holder. (c) Notwithstanding any other provision of this code, a transferee of a tax lien is subrogated to and is entitled to exercise any right or remedy possessed by the transferring taxing unit, including or related to foreclosure or judicial sale, but is prohibited from exercising a remedy of foreclosure or judicial sale where the transferring taxing unit would be prohibited from foreclosure or judicial sale. (d) Chapters 342 and 346, Finance Code, [and Section 302.102, Finance Code,] do not apply to a transaction covered by this section. The transferee of a tax lien under this section is not required to obtain a license under Title 4, Finance Code. (f) Before accepting an application fee or executing a contract, the transferee shall disclose [The first written communication by the lender] to the transferee's [its] prospective borrower each type and [shall disclose] the amount [types] of possible additional charges or fees that may be incurred by the borrower in connection with the loan or contract under this section. (g) An affidavit of the transferee executed after foreclosure of a tax lien that recites compliance with the terms of Section 32.06 and this section and is recorded in each county in which the property is located: (1) is prima facie evidence of compliance with Section 32.06 and this section; and (2) may be relied on conclusively by a bona fide purchaser for value without notice of any failure to comply. SECTION 15. Sections 33.011(a) and (d), Tax Code, are amended to read as follows: (a) The governing body of a taxing unit: (1) shall waive penalties and may provide for the waiver of interest on a delinquent tax if an act or omission of an officer, employee, or agent of the taxing unit or the appraisal district in which the taxing unit participates caused or resulted in the taxpayer's failure to pay the tax before delinquency and if the tax is paid not later than the 21st day after the date the taxpayer knows or should know of the delinquency; and (2) may waive penalties and provide for the waiver of interest on a delinquent tax if: (A) the property for which the tax is owed is acquired by a religious organization; and (B) [that qualifies the property for exemption under Section 11.20] before the first anniversary of the date the religious organization acquires the property, the organization pays the tax and qualifies the property for an exemption under Section 11.20 as evidenced by the approval of the exemption by the chief appraiser under Section 11.45. (d) A request for a waiver of penalties and interest under Subsection (a)(1), (b), or (h) [this section] must be made before the 181st day after the delinquency date. A request for a waiver of penalties and interest under Subsection (a)(2) must be made before the first anniversary of the date the religious organization acquires the property. To be valid, a waiver of penalties or interest under this section must be requested in writing. If a written request for a waiver is not timely made, the governing body of a taxing unit may not waive any penalties or interest under this section. SECTION 16. Section 33.02(a), Tax Code, is amended to read as follows: (a) The collector for a taxing unit [that collects its own taxes] may enter an agreement with a person delinquent in the payment of the tax for payment of the tax, penalties, and interest in installments. The agreement must be in writing and may not extend for a period of more than 36 months. SECTION 17. Section 33.22, Tax Code, is amended by adding Subsections (d) and (e) to read as follows: (d) A collector is entitled to recover attorney's fees in an amount equal to the compensation specified in the contract with the attorney if: (1) recovery of the attorney's fees is requested in the application for the tax warrant; (2) the taxing unit served by the collector contracts with an attorney under Section 6.30; (3) the existence of the contract and the amount of attorney's fees that equals the compensation specified in the contract are supported by the affidavit of the collector; and (4) the tax sought to be recovered is not subject to the additional penalty under Section 33.07 or 33.08 at the time the application is filed. (e) If a taxing unit is represented by an attorney who is also an officer or employee of the taxing unit, the collector for the taxing unit is entitled to recover attorney's fees in an amount equal to 15 percent of the total amount of delinquent taxes, penalties, and interest that the property owner owes the taxing unit. SECTION 18. Subchapter A, Chapter 33, Tax Code, is amended by adding Section 33.045 to read as follows: Sec. 33.045. NOTICE OF PROVISIONS AUTHORIZING DEFERRAL OR ABATEMENT. (a) A tax bill mailed by an assessor or collector under Section 31.01 and any written communication delivered to a property owner by an assessor or collector for a taxing unit or an attorney or other agent of a taxing unit that specifically threatens a lawsuit to collect a delinquent tax shall contain the following explanation in capital letters: "IF YOU ARE 65 YEARS OF AGE OR OLDER OR ARE DISABLED AND THE PROPERTY DESCRIBED IN THIS DOCUMENT IS YOUR RESIDENCE HOMESTEAD, YOU SHOULD CONTACT THE APPRAISAL DISTRICT REGARDING ANY ENTITLEMENT YOU MAY HAVE TO A POSTPONEMENT IN THE PAYMENT OF THESE TAXES". (b) This section does not apply to a communication that relates to taxes that are the subject of pending litigation. SECTION 19. Subchapter A, Chapter 33, Tax Code, is amended by adding Section 33.11 to read as follows: Sec. 33.11. EARLY ADDITIONAL PENALTY FOR COLLECTION COSTS FOR TAXES IMPOSED ON PERSONAL PROPERTY. (a) In order to defray costs of collection, the governing body of a taxing unit or appraisal district in the manner required by law for official action may provide that taxes imposed on tangible personal property that become delinquent on or after February 1 of a year incur an additional penalty on a date that occurs before July 1 of the year in which the taxes become delinquent if: (1) the taxing unit or appraisal district or another unit that collects taxes for the unit has contracted with an attorney under Section 6.30; and (2) the taxes on the personal property become subject to the attorney's contract before July 1 of the year in which the taxes become delinquent. (b) A penalty imposed under Subsection (a) is incurred by the delinquent taxes on the later of: (1) the date those taxes become subject to the attorney's contract; or (2) 60 days after the date the taxes become delinquent. (c) The amount of the penalty may not exceed the amount of the compensation specified in the contract with the attorney to be paid in connection with the collection of the delinquent taxes. (d) A tax lien attaches to the property on which the tax is imposed to secure payment of the penalty. (e) If a penalty is provided under this section, a taxing unit or appraisal district may not: (1) recover attorney's fees in a suit to collect delinquent taxes subject to the penalty; or (2) impose an additional penalty under Section 33.07 on a delinquent personal property tax. (f) If the governing body of a taxing unit or appraisal district provides for a penalty under this section, the collector for the taxing unit or appraisal district shall send a notice of the penalty to the property owner. The notice shall state the date on which the penalty is incurred, and the tax collector shall deliver the notice at least 30 and not more than 60 days before that date. If the amount of personal property tax, penalty and interest owed to all taxing units for which the tax collector collects exceeds $10,000 on a single account identified by a unique property identification number, the notice regarding that account must be delivered by certified mail, return receipt requested. All other notices under this section may be delivered by regular first-class mail. (g) The authority granted to taxing units and appraisal districts under this section is to be construed as an alternative, with regards to delinquent personal property taxes, to the authority given by Section 33.07. SECTION 20. Section 33.23(a), Tax Code, is amended to read as follows: (a) A tax warrant shall direct a peace officer in the county and the collector to seize as much of the person's personal property as may be reasonably necessary for the payment of all taxes, penalties, [and] interest, and attorney's fees included in the application and all costs of seizure and sale. The warrant shall direct the person whose property is seized to disclose to the officer executing the warrant the name and the address if known of any other person having an interest in the property. SECTION 21. Section 33.25, Tax Code, is amended by amending Subsections (f) and (h) and adding Subsection (i) to read as follows: (f) The proceeds of a sale of property under this section shall be applied to: (1) any compensation owed to or any expense advanced by the licensed auctioneer under an agreement entered into under Subsection (b) or a service provider under an agreement entered into under Subsection (c); (2) all usual costs, expenses, and fees of the seizure and sale, payable to the peace officer conducting the sale; (3) all additional expenses incurred in advertising the sale or in removing, storing, preserving, or safeguarding the seized property pending its sale; (4) all usual court costs payable to the clerk of the court that issued the tax warrant; and (5) taxes, penalties, [and] interest, and attorney's fees included in the application for warrant. (h) After a seizure of personal property defined by Sections 33.21(d)(2)-(5), the collector shall apply the seized property toward the payment of the taxes, penalties, [and] interest, and attorney's fees included in the application for warrant and all costs of the seizure as required by Subsection (f). (i) After a tax warrant is issued, the seizure or sale of the property may be canceled and terminated at any time by the applicant or an authorized agent or attorney of the applicant. SECTION 22. Section 33.48, Tax Code, is amended by adding Subsection (d) to read as follows: (d) A collector who accepts a payment of the court costs and other expenses described by this section shall disburse the amount of the payment as follows: (1) amounts owing under Subsections (a)(1), (2), (3), and (6) are payable to the clerk of the court in which the suit is pending; and (2) expenses described by Subsection (a)(4) are payable to the general fund of the taxing unit or to the person or entity who advanced the expense. SECTION 23. Section 33.51, Tax Code, is amended to read as follows: Sec. 33.51. WRIT OF POSSESSION. (a) If the court orders the foreclosure of a tax lien and the sale of real property, the judgment shall provide for the issuance by the clerk of said court of a writ of possession to the purchaser at the sale or to the purchaser's assigns no sooner than 20 days following the date on which the purchaser's deed from the sheriff or constable is filed of record. (b) The officer charged with executing the writ shall place the purchaser or the purchaser's assigns in possession of the property described in the purchaser's deed without further order from any court and in the manner provided by the writ, subject to any notice to vacate that may be required to be given to a tenant under Section 24.005(b), Property Code. (c) The writ of possession shall order the officer executing the writ to: (1) post a written warning that is at least 8-1/2 by 11 inches on the exterior of the front door of the premises notifying the occupant that the writ has been issued and that the writ will be executed on or after a specific date and time stated in the warning that is not sooner than the 10th day after the date the warning is posted; and (2) on execution of the writ: (A) deliver possession of the premises to the purchaser or the purchaser's assigns; (B) instruct the occupants to immediately leave the premises and, if the occupants fail or refuse to comply, physically remove them from the premises; (C) instruct the occupants to remove, or to allow the purchaser or purchaser's assigns, representatives, or other persons acting under the officer's supervision to remove, all personal property from the premises; and (D) place, or have an authorized person place, the removed personal property outside the premises at a nearby location, but not so as to block a public sidewalk, passageway, or street and not while it is raining, sleeting, or snowing. (d) The writ of possession shall authorize the officer, at the officer's discretion, to engage the services of a bonded or insured warehouseman to remove and store, subject to applicable law, all or part of the personal property at no cost to the purchaser, the purchaser's assigns, or the officer executing the writ. The officer may not require the purchaser or the purchaser's assigns to store the personal property. (e) The writ of possession shall contain notice to the officer that under Section 7.003, Civil Practice and Remedies Code, the officer is not liable for damages resulting from the execution of the writ if the officer executes the writ in good faith and with reasonable diligence. (f) The warehouseman's lien on stored property, the officer's duties, and the occupants' rights of redemption as provided by Section 24.0062, Property Code, are all applicable with respect to any personal property that is removed under Subsection (d). (g) A sheriff or constable may use reasonable force in executing a writ under this section. (h) If a taxing unit is a purchaser and is entitled to a writ of possession in the taxing unit's name: (1) a bond may not be required of the taxing unit for issuance or delivery of a writ of possession; and (2) a fee or court cost may not be charged for issuance or delivery of a writ of possession. (i) In this section: (1) "Premises" means all of the property described in the purchaser's deed, including the buildings, dwellings, or other structures located on the property. (2) "Purchaser" includes a taxing unit to which property is bid off under Section 34.01(j). SECTION 24. Subchapter C, Chapter 33, Tax Code, is amended by adding Section 33.57 to read as follows: Sec. 33.57. ALTERNATIVE NOTICE OF TAX FORECLOSURE ON CERTAIN PARCELS OF REAL PROPERTY. (a) In this section, "appraised value" means the appraised value according to the most recent appraisal roll approved by the appraisal review board. (b) This section may be invoked and used by one or more taxing units if there are delinquent taxes, penalties, interest, and attorney's fees owing to a taxing unit on a parcel of real property, and: (1) the total amount of delinquent taxes, penalties, interest, and attorney's fees owed exceeds the appraised value of the parcel; or (2) there are 10 or more years for which delinquent taxes are owed on the parcel. (c) One or more taxing units may file a single petition for foreclosure under this section that includes multiple parcels of property and multiple owners. Alternatively, separate petitions may be filed and docketed separately for each parcel of property. Another taxing unit with a tax claim against the same parcel may intervene in an action for the purpose of establishing and foreclosing its tax lien without further notice to a defendant. The petition must be filed in the county in which the tax was imposed and is sufficient if it is in substantially the form prescribed by Section 33.43 and further alleges that: (1) the amount owed in delinquent taxes, penalties, interest, and attorney's fees exceeds the appraised value of the parcel; or (2) there are 10 or more years for which delinquent taxes are owed on the parcel. (d) Simultaneously with the filing of the petition under this section, a taxing unit shall also file a motion with the court seeking an order approving notice of the petition to each defendant by certified mail in lieu of citation and, if the amount of delinquent taxes, penalties, interest, and attorney's fees alleged to be owed exceeds the appraised value of the parcel, waiving the appointment of an attorney ad litem. The motion must be supported by certified copies of tax records that show the tax years for which delinquent taxes are owed, the amounts of delinquent taxes, penalties, interest, and attorney's fees, and, if appropriate, the appraised value of the parcel. (e) The court shall approve a motion under Subsection (d) if the documents in support of the motion show that: (1) the amount of delinquent taxes, penalties, interest, and attorney's fees that are owed exceeds the appraised value of the parcel; or (2) there are 10 or more years for which delinquent taxes are owed on the parcel. (f) Before filing a petition under this section, or as soon afterwards as practicable, the taxing unit or its attorney shall determine the address of each owner of a property interest in the parcel for the purpose of providing notice of the pending petition. If the title search, the taxing unit's tax records, and the appraisal district records do not disclose an address of a person with a property interest, consulting the following sources of information is to be considered a reasonable effort by the taxing unit or its attorney to determine the address of a person with a property interest in the parcel subject to foreclosure: (1) telephone directories, electronic or otherwise, that cover: (A) the area of any last known address for the person; and (B) the county in which the parcel is located; (2) voter registration records in the county in which the parcel is located; and (3) where applicable, assumed name records maintained by the county clerk of the county in which the parcel is located and corporate records maintained by the secretary of state. (g) Not later than the 45th day before the date on which a hearing on the merits on a taxing unit's petition is scheduled, the taxing unit or its attorney shall send a copy of the petition and a notice by certified mail to each person whose address is determined under Subsection (f), informing the person of the pending foreclosure action and the scheduled hearing. A copy of each notice shall be filed with the clerk of the court together with an affidavit by the tax collector or by the taxing unit's attorney attesting to the fact and date of mailing of the notice. (h) In addition to the notice required by Subsection (g), the taxing unit shall provide notice by publication and by posting to all persons with a property interest in the parcel subject to foreclosure. The notice shall be published in the English language once a week for two weeks in a newspaper that is published in the county in which the parcel is located and that has been in general circulation for at least one year immediately before the date of the first publication, with the first publication to be not less than the 45th day before the date on which the taxing unit's petition is scheduled to be heard. When returned and filed in the trial court, an affidavit of the editor or publisher of the newspaper attesting to the date of publication, together with a printed copy of the notice as published, is sufficient proof of publication under this subsection. If a newspaper is not published in the county in which the parcel is located, publication in an otherwise qualifying newspaper published in an adjoining county is sufficient. The maximum fee for publishing the citation shall be the lowest published word or line rate of that newspaper for classified advertising. The notice by posting shall be in the English language and given by posting a copy of the notice at the courthouse door of the county in which the foreclosure is pending not less than the 45th day before the date on which the taxing unit's petition is scheduled to be heard. Proof of the posting of the notice shall be made by affidavit of the attorney for the taxing unit, or of the person posting it. If the publication of the notice cannot be had for the maximum fee established in this subsection, and that fact is supported by the affidavit of the attorney for the taxing unit, the notice by posting under this subsection is sufficient. (i) The notice required by Subsections (g) and (h) must include: (1) a statement that foreclosure proceedings have been commenced and the date the petition was filed; (2) a legal description, tax account number, and, if known, a street address for the parcel in which the addressee owns a property interest; (3) the name of the person to whom the notice is addressed and the name of each other person who, according to the title search, has an interest in the parcel in which the addressee owns a property interest; (4) the date, time, and place of the scheduled hearing on the petition; (5) a statement that the recipient of the notice may lose whatever property interest the recipient owns in the parcel as a result of the hearing and any subsequent tax sale; (6) a statement explaining how a person may contest the taxing unit's petition as provided by Subsection (j) and that a person's interest in the parcel may be preserved by paying all delinquent taxes, penalties, interest, attorney's fees, and court costs before the date of the scheduled hearing on the petition; (7) the name, address, and telephone number of the taxing unit and the taxing unit's attorney of record; and (8) the name of each other taxing unit that imposes taxes on the parcel, together with a notice that any taxing unit may intervene without further notice and set up its claims for delinquent taxes. (j) A person claiming a property interest in a parcel subject to foreclosure may contest a taxing unit's petition by filing with the clerk of the court a written response to the petition not later than the seventh day before the date scheduled for hearing on the petition and specifying in the response any affirmative defense of the person. A copy of the response must be served on the taxing unit's attorney of record in the manner required by Rule 21a, Texas Rules of Civil Procedure. The taxing unit is entitled on request to a continuance of the hearing if a written response filed to a notice of the hearing contains an affirmative defense or requests affirmative relief against the taxing unit. (k) Before entry of a judgment under this section, a taxing unit may remove a parcel erroneously included in the petition and may take a voluntary nonsuit as to one or more parcels of property without prejudicing its action against the remaining parcels. (l) If before the hearing on a taxing unit's petition the taxing unit discovers a deficiency in the provision of notice under this section, the taxing unit shall take reasonable steps in good faith to correct the deficiency before the hearing. A notice provided by Subsections (g)-(i) is in lieu of citation issued and served under Rule 117a, Texas Rules of Civil Procedure. Regardless of the manner in which notice under this section is given, an attorney ad litem may not be appointed for a person with an interest in a parcel with delinquent taxes, penalties, interest, and attorney's fees against the parcel in an amount that exceeds the parcel's appraised value. To the extent of any additional conflict between this section and the Texas Rules of Civil Procedure, this section controls. Except as otherwise provided by this section, a suit brought under this section is governed generally by the Texas Rules of Civil Procedure and by Subchapters C and D of this chapter. (m) A judgment in favor of a taxing unit under this section must be only for foreclosure of the tax lien against the parcel. The judgment may not include a personal judgment against any person. (n) A person is considered to have been provided sufficient notice of foreclosure and opportunity to be heard for purposes of a proceeding under this section if the taxing unit follows the procedures required by this section for notice by certified mail or by publication and posting or if one or more of the following apply: (1) the person had constructive notice of the hearing on the merits by acquiring an interest in the parcel after the date of the filing of the taxing unit's petition; (2) the person appeared at the hearing on the taxing unit's petition or filed a responsive pleading or other communication with the clerk of the court before the date of the hearing; or (3) before the hearing on the taxing unit's petition, the person had actual notice of the hearing. SECTION 25. Section 42.23, Tax Code, is amended by adding Subsections (d) and (e) to read as follows: (d) Each party to an appeal is considered a party seeking affirmative relief for the purpose of discovery regarding expert witnesses under the Texas Rules of Civil Procedure if, on or before the 120th day after the date the appeal is filed, the property owner: (1) makes a written offer of settlement; (2) requests alternative dispute resolution; and (3) designates, in response to an appropriate written discovery request, which cause of action under this chapter is the basis for the appeal. (e) For purposes of Subsection (d), a property owner may designate a cause of action under Section 42.25 or 42.26 as the basis for an appeal, but may not designate a cause of action under both sections as the basis for the appeal. Discovery regarding a cause of action that is not specifically designated by the property owner under Subsection (d) shall be conducted as provided by the Texas Rules of Civil Procedure. The court may enter a protective order to modify the provisions of this subsection under Rule 192.6 of the Texas Rules of Civil Procedure. SECTION 26. Section 12.002(e), Property Code, is amended to read as follows: (e) A person may not file for record or have recorded in the county clerk's office a plat or replat of a subdivision of real property unless the plat or replat has attached to it an original tax certificate from each taxing unit with jurisdiction of the real property indicating that no delinquent ad valorem taxes are owed on the real property. This subsection does not apply if: (1) more than one person acquired the real property from a decedent under a will or by inheritance and those persons owning an undivided interest in the property obtained approval to subdivide the property to provide each person with a divided interest and a separate title to the property; or (2) a taxing unit acquired the real property for public use through eminent domain proceedings or voluntary sale. SECTION 27. Subchapter B, Chapter 21, Property Code, is amended by adding Section 21.0211 to read as follows: Sec. 21.0211. PAYMENT OF AD VALOREM TAXES. (a) A court may not authorize withdrawal of any money deposited under Section 21.021 unless the petitioner for the money files with the court: (1) a tax certificate issued under Section 31.08, Tax Code, by the tax collector for each taxing unit that imposes ad valorem taxes on the condemned property showing that there are no delinquent taxes, penalties, interest, or costs owing on the condemned property or on any larger tract of which the condemned property forms a part; and (2) in the case of a whole taking that occurs after the date the ad valorem tax bill for taxes imposed by a taxing unit on the property is sent, a tax receipt issued under Section 31.075, Tax Code, by the tax collector of the taxing unit that imposes ad valorem taxes showing that the taxes on the condemned property for the current tax year, prorated under Section 26.11, Tax Code, have been paid. (b) For purposes of Subsection (a)(2), a "case of a whole taking" means a case in which the location, size, and boundaries of the property assessed for ad valorem taxes are identical to that of the condemned property. SECTION 28. Section 17.091(a), Civil Practice and Remedies Code, is amended to read as follows: (a) In a suit to collect delinquent property taxes by the state or a subdivision of the state in which a person who is a defendant is a nonresident, the secretary of state is an agent for service of process on that defendant if the defendant owns, has, or claims an interest in or a lien against property in this state that is the subject of the suit. SECTION 29. (a) Section 11.43(m), Tax Code, as added by this Act, applies only to eligibility for an exemption from ad valorem taxation under Section 11.13(c) or (d), Tax Code, for an individual 65 years of age or older for a tax year beginning on or after January 1, 2006. (b) Section 23.225, Tax Code, as added by this Act, and Section 23.51, Tax Code, as amended by this Act, apply only to the appraisal of land for a tax year that begins on or after January 1, 2006. (c) Section 31.05(a), Tax Code, as amended by this Act, applies to the adoption of a discount by a taxing unit beginning with the 2005 tax year, except as provided by Subsection (d) of this section. (d) If a taxing unit's tax bills for the 2005 tax year are mailed before the effective date of this Act, Section 31.05(a), Tax Code, as amended by this Act, applies to the adoption of a discount by the taxing unit beginning with the 2006 tax year, and the law in effect when the bills were mailed applies to the 2005 tax year with respect to that taxing unit. (e) Section 31.073, Tax Code, as amended by this Act, applies only to payments of taxes, penalties, or interest that are made on or after the effective date of this Act. (f) Section 32.05, Tax Code, as amended by this Act, applies to any lien, regardless of the date on which it arose, and to any cause of action pending on the effective date of this Act or brought after that date. (g) Section 33.011, Tax Code, as amended by this Act, applies only to a request for a waiver of penalty or interest made on or after the effective date of this Act. A request for a waiver made before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose. (h) Section 33.02, Tax Code, as amended by this Act, applies to an installment agreement entered before, on, or after the effective date of this Act. (i) Section 33.22, Tax Code, as amended by this Act, applies only to a tax warrant proceeding pending on the effective date of this Act or brought after that date. (j) Section 33.23, Tax Code, as amended by this Act, applies only to an installment agreement Section 33.23, Tax Code, as amended by this Act, applies only to a tax warrant issued on or after the effective date of this Act. A tax warrant issued before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose. (k) Section 33.25, Tax Code, as amended by this Act, applies only to a tax warrant proceeding in which the application for a tax warrant was filed on or after the effective date of this Act. A tax warrant proceeding commenced by application before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose. (l) Section 33.48, Tax Code, as amended by this Act, applies only to a cause of action pending on the effective date of this Act or brought after that date. (m) Section 33.51, Tax Code, as amended by this Act, applies to a writ of possession that is based on a judgment entered before, on, or after the effective date of this Act. (n) Section 33.57, Tax Code, as added by this Act, applies only to a cause of action pending on the effective date of this Act or brought after the effective date of this Act. (o) Section 42.23, Tax Code, as amended by this Act, applies only to an appeal of an appraisal review board order if the appeal is filed or amended on or after the effective date of this Act. An appeal filed or amended before the effective date of this Act is covered by the law in effect when the appeal was filed or amended, and the former law is continued in effect for that purpose. (p) Section 12.002(e), Property Code, as amended by this Act, applies only to a plat or replat of a subdivision that is filed for recordation on or after the effective date of this Act. A plat or replat of a subdivision that was filed for recordation before the effective date of this Act is governed by the law in effect immediately before the effective date of this Act, and the former law is continued in effect for that purpose. (q) Section 21.0211, Property Code, as added by this Act, applies only to an eminent domain proceeding that is commenced on or after the effective date of this Act. An eminent domain proceeding commenced before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose. (r) Section 17.091, Civil Practice and Remedies Code, as amended by this Act, applies only to a cause of action pending on the effective date of this Act or brought after the effective date of this Act. SECTION 30. This Act takes effect September 1, 2005. ______________________________ ______________________________ President of the Senate Speaker of the House I certify that H.B. No. 2491 was passed by the House on April 29, 2005, by a non-record vote; that the House refused to concur in Senate amendments to H.B. No. 2491 on May 27, 2005, and requested the appointment of a conference committee to consider the differences between the two houses; and that the House adopted the conference committee report on H.B. No. 2491 on May 29, 2005, by a non-record vote. ______________________________ Chief Clerk of the House I certify that H.B. No. 2491 was passed by the Senate, with amendments, on May 24, 2005, by the following vote: Yeas 31, Nays 0; at the request of the House, the Senate appointed a conference committee to consider the differences between the two houses; and that the Senate adopted the conference committee report on H.B. No. 2491 on May 29, 2005, by the following vote: Yeas 31, Nays 0. ______________________________ Secretary of the Senate APPROVED: __________________ Date __________________ Governor