Bill > HB178

This bill introduces a new requirement for certain political subdivisions (local government entities like cities or counties, but not school districts) to conduct an efficiency audit if they adopt an ad valorem tax rate (property tax rate) that exceeds the "no-new-revenue tax rate" (a baseline tax rate that would generate the same total revenue as the previous year) for five consecutive tax years. The efficiency audit is defined as an investigation into the entity's fiscal management, efficiency, and resource utilization. The political subdivision must pay for the audit, which must be conducted by an independent auditor within three months of selection. The auditor will have access to all necessary documents and records, and the governing body must hold a public meeting to discuss the audit results, which must then be posted on the entity's website within 30 days. The bill provides an exception for political subdivisions located in areas declared disaster areas, allowing them to potentially exceed tax rates without an audit for two years following a disaster declaration. Notably, tax years before 2022 will not count towards the five-year calculation, and this provision expires on January 1, 2027. The act will take effect 91 days after the end of the legislative session.

Budget and Finance

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=892&Bill=HB178