Texas Senate Bill SJR 73

Texas 2025 - 89th Regular

• Filed: 3/12/25

Caption

Proposing a constitutional amendment authorizing the legislature to exempt from ad valorem taxation the amount of the appraised value of real property that arises from the installation or construction on the property of a generator that is primarily for the production and distribution of energy for on-site use.

Summary

SJR 73 proposes a constitutional amendment that would let the Legislature exempt from ad valorem property taxation the increase in a property’s appraised value caused by installing or constructing a generator used primarily to produce and distribute energy for on-site use. In practical terms, the measure is aimed at on-site power generation equipment and the portion of real property value attributable to that installation, rather than creating a broad new exemption for all energy infrastructure. If approved by voters, the amendment would change Article VIII of the Texas Constitution to add this category to the list of constitutionally authorized property tax exemptions. The Legislature would then be able to enact general laws defining the scope and administration of the exemption. The proposed amendment is set for submission to voters at the November 4, 2025 election, and the ballot language frames the issue as a constitutional authorization for a property tax exemption tied to on-site energy generators.

Impact

The bill would amend the Texas Constitution’s property tax exemption provisions, specifically Article VIII, Section 2(a), to authorize a new exemption for the appraised value added to real property by on-site energy generators. This would affect local ad valorem tax bases by potentially reducing taxable property values for qualifying properties, and it would give the Legislature authority to implement the exemption through future general law. The measure could benefit property owners, businesses, institutions, or other entities that install on-site generation systems, while reducing property tax revenue for local taxing units to the extent the exemption is adopted and used.

Sentiment

Available context shows no recorded committee testimony or votes, so there is no direct evidence of organized support or opposition in the provided materials. The bill’s caption and constitutional framing suggest a generally pro-energy, pro-investment policy approach, likely intended to encourage on-site generation and related infrastructure. Because it is a constitutional amendment, final approval would depend on voter approval after legislative passage, which means the ultimate sentiment will be shaped by both legislative and public response.

Contention

The main policy question is whether property tax relief should be extended to the value added by on-site generators, balancing incentives for energy self-sufficiency against the loss of local tax revenue. Potential supporters would include property owners, businesses, and energy users seeking to offset installation costs, while potential critics may include local governments and taxing authorities concerned about erosion of the tax base and the breadth of the exemption. Another possible point of contention is how broadly the Legislature could define “primarily for the production and distribution of energy for on-site use,” since implementation details would determine which technologies and properties qualify.