1. (a) Notwithstanding any other provision of this title or Chapter 26, Tax Code, if the maximum amount of the basic allotment provided under Section 48.051(a) or (b) for a school year is less than the maximum amount provided for the 2020-2021 school year, subject to Subsection (b), a school district may adopt a maintenance and operations tax rate that exceeds the maximum compressed tax rate permitted under Section 48.2551, provided that:

   1. (1) the rate adopted by the district was previously approved by voters for a tax year subsequent to the 2005 tax year; and

   2. (2) the rate may not exceed the lesser of:

      1. (A) $1.17; or
      2. (B) the district's maximum compressed tax rate and the additional tax rate necessary to generate the amount of revenue equal to the difference in per student funding.

2. (b) Before adopting a maintenance and operations tax rate under Subsection (a), a school district must receive approval from the agency. To receive approval from the agency under this subsection the district must submit the following information:

   1. (1) a statement detailing the loss of funding to the district that resulted from the decline in the maximum amount of the basic allotment provided under Section 48.051(a) or (b);
   2. (2) the proposed additional tax effort and the amount of funding the proposed additional tax effort will generate;
   3. (3) evidence that the proposed additional tax effort described by Subdivision (2) had been previously authorized by voters subsequent to the 2005 tax year; and
   4. (4) any other information required by the commissioner.
3. (c) The agency's approval of a district's tax rate under Subsection (b) expires at the end of each tax year.

4. (d) Any additional tax effort by a school district authorized under this section is not:

   1. (1) eligible for funding under Subchapter B, C, or D;
   2. (2) eligible for the guaranteed yield amount of state funds under Section 48.202; or
   3. (3) subject to the limit on local revenue under Section 48.257.
5. (e) The commissioner shall reduce state aid or adjust the limit on local revenue under Section 48.257 in an amount equal to the amount of revenue generated by a school district's tax effort that is not in compliance with this section or Section 48.2551.
6. (f) This section does not apply to a school district to which Section 45.003(f) applies.

Added by Acts 2019, 86th Leg., R.S., Ch. 943 (H.B. 3), Sec. 1A.007, eff. September 1, 2020.