89R24663 PRL-F     By: Turner, Martinez Fischer H.B. No. 4478     Substitute the following for H.B. No. 4478:     By:  Martinez Fischer C.S.H.B. No. 4478       A BILL TO BE ENTITLED   AN ACT   relating to the determination of the capitalization rate to be used   in the appraisal for ad valorem tax purposes of certain property   used for low-income housing.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 11.1825, Tax Code, is amended by   amending Subsections (q) and (r) and adding Subsection (r-1) to   read as follows:          (q)  If property qualifies for an exemption under this   section, the chief appraiser shall use the income method of   appraisal as described by Section 23.012 to determine the appraised   value of the property.  The chief appraiser shall use that method   regardless of whether the chief appraiser considers that method to   be the most appropriate method of appraising the property.  In   appraising the property, the chief appraiser shall:                (1)  consider the restrictions provided by this section   on the income of the individuals or families to whom the dwelling   units of the housing project may be rented and the amount of rent   that may be charged for purposes of computing the actual rental   income from the property or projecting future rental income; and                (2)  except as provided by Subsection (r-1), use the   same capitalization rate that the chief appraiser uses to appraise   other rent-restricted properties.          (r)  Not later than January 31 of each year, the appraisal   district shall give public notice in the manner determined by the   district, including posting on the district's website if   applicable, of the capitalization rate to be used in that year to   appraise property receiving an exemption under this section, other   than property described by Subsection (r-1). The appraisal   district shall post on the district's website the capitalization   rate adopted by the Texas Department of Housing and Community   Affairs to be used in the applicable year to appraise property   described by Subsection (r-1) as soon as practicable after the rate   is submitted to the district.          (r-1)  Not later than January 31 of each year, the Texas   Department of Housing and Community Affairs shall adopt the   capitalization rate that must be used by the chief appraiser of each   appraisal district in this state to appraise property receiving an   exemption under this section that also receives financial   assistance administered under Subchapter DD, Chapter 2306,   Government Code. The department shall give public notice, in the   manner determined by the department, of the capitalization rate   adopted under this subsection and shall post the rate on the   department's website and submit the rate to the chief appraiser of   each appraisal district in this state. The department may not give   public notice of the capitalization rate until the department has   provided the public a reasonable opportunity to comment on the rate   adopted by the department and its applicability to the areas of this   state in which the rate will be used. When determining the   capitalization rate under this subsection, the department must   consider data available to the department with regard to income   received and expenses incurred by similar rent-restricted   properties.          SECTION 2.  This Act applies only to an ad valorem tax year   that begins on or after the effective date of this Act.          SECTION 3.  This Act takes effect January 1, 2026.