HBA-JRA H.B. 1978 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1978 By: Kuempel Ways & Means 3/18/1999 Introduced BACKGROUND AND PURPOSE Section 11.18 of the Tax Code currently provides an exemption from ad valorem taxation for charitable organizations. However, the description of a charitable organization designed to support elderly persons is sufficiently narrow that some counties have interpreted it to mean that the charitable organization must be designed exclusively to provide support to qualify for an exemption. H.B. 1978 includes senior citizens centers that provide many kinds of services to the elderly in the description of a charitable organization that qualifies for an exemption from ad valorem taxation. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 11.18, Tax Code, by amending Subsection (d) and adding Subsection (l), as follows: (d) Provides that Subsection (l) of this section, which exempts charitable organizations from taxation of buildings and tangible personal property, provides an exception to this subsection. Includes the provision of recreational or social activities and facilities designed to address the special needs of elderly persons among the acceptable purposes and functions of charitable organizations. Makes conforming changes. (l) Provides that a charitable organization that provides recreational or social activities and facilities designed to address the special needs of elderly persons must engage primarily in performing those functions, but is authorized to engage in other activities that support or are related to its charitable functions. SECTION 2. (a) Provides that this Act takes effect as provided by this section only if the constitutional amendment proposed by the 76th Legislature, Regular Session, 1999, to authorize the exemption of property of institutions of public charity, as defined by general law, from ad valorem taxation, is approved by the voters. (b) Effective date: January 1, 2000. Makes application of this Act prospective. SECTION 3. Emergency clause.