HB 5217

relating to the provision of state aid to certain local governments
disproportionately affected by the granting of ad valorem tax
relief to disabled veterans and surviving spouses of certain armed
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  The heading to Section 140.011, Local Government
Code, is amended to read as follows:
Sec. 140.011.  LOCAL GOVERNMENTS DISPROPORTIONATELY
AFFECTED BY PROPERTY TAX RELIEF FOR DISABLED VETERANS AND SURVIVING
SPOUSES OF CERTAIN ARMED SERVICES MEMBERS.
SECTION 2.  Section 140.011(a)(3), Local Government Code, is
(3)  "Qualified local government" means a local
government entitled to a military exemption [disabled veteran]
assistance payment under this section.
SECTION 3.  Sections 140.011(b), (c), (d), (e), (f), and
(g), Local Government Code, are amended to read as follows:
(b)  To serve the state purpose of ensuring that the cost of
providing ad valorem tax relief to disabled veterans and surviving
spouses of members of the armed services killed or fatally injured
in the line of duty is shared equitably among the residents of this
state, a local government is entitled to a military exemption
[disabled veteran] assistance payment from the state for each
fiscal year that the local government is a qualified local
government.  A local government is a qualified local government for
a fiscal year if the amount of lost ad valorem tax revenue
calculated under Subsection (c) for that fiscal year is equal to or
greater than two percent of the local government's general fund
(c)  For the purposes of this section, the amount of a local
government's lost ad valorem tax revenue for a fiscal year is
calculated by multiplying the ad valorem tax rate adopted by the
local government under Section 26.05, Tax Code, for the tax year in
which the fiscal year begins by the total appraised value of all
property located in the local government that is granted an
exemption from taxation under Section 11.131 or 11.133, Tax Code,
(d)  A military exemption [disabled veteran] assistance
payment made to a qualified local government for a fiscal year is
calculated by subtracting from the local government's lost ad
valorem tax revenue calculated under Subsection (c) for that fiscal
year an amount equal to one percent of the local government's
general fund revenue for that fiscal year.
(e)  Not later than May [April] 1 of the first year following
the end of a fiscal year for which a qualified local government is
entitled to a military exemption [disabled veteran] assistance
payment, a qualified local government may submit an application to
the comptroller to receive a military exemption [disabled veteran]
assistance payment for that fiscal year.  The application must be
made on a form prescribed by the comptroller.  The comptroller may
require the qualified local government to submit an independent
audit otherwise required by law to be prepared for the local
government for the fiscal year for which a qualified local
government is entitled to the payment.
(f)  A qualified local government that does not submit an
application to the comptroller by the date prescribed by Subsection
(e) is not entitled to a military exemption [disabled veteran]
assistance payment for the fiscal year for which that deadline
(g)  The comptroller shall review each application by a local
government to determine whether the local government is entitled to
a military exemption [disabled veteran] assistance payment.  If the
comptroller determines that the local government is entitled to the
payment, the comptroller shall remit the payment from available
funds to the qualified local government not later than the 30th day
after the date the application for the payment is made.
SECTION 4.  Section 140.011, Local Government Code, as
amended by this Act, applies to the deadline for a local government
to apply for, and the calculation of the amount of, a military
exemption assistance payment beginning with the fiscal year of the
local government that ends in the 2025 tax year.
SECTION 5.  This Act takes effect September 1, 2025.