Bill > HB1035

This bill modifies the requirements for obtaining a property tax exemption for child-care facilities by defining two key terms and updating the affidavit requirements. A "net lease" is defined as a lease where the lessee pays taxes on the property in addition to base rent, and a "qualifying child-care facility" is one that participates in the Texas Rising Star Program and has at least 20% of enrolled children receiving subsidized child-care services. The bill expands the affidavit requirements for tax exemption applicants, allowing them to either provide a disclosure document showing tax reduction to the child-care facility or demonstrate that the property is subject to a net lease where the child-care facility is responsible for property taxes. The affidavit must also confirm that the rent charged reflects the tax reduction, either through a rent credit or by the terms of the net lease, and that the rent is not higher than comparable property rates. The changes will apply only to exemption applications filed on or after the bill's effective date, which is immediate if it receives a two-thirds vote in the Texas Legislature, or September 1, 2025, if not.

Budget and Finance

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=HB1035