Proposing a constitutional amendment to increase the amount of the exemption of residence homesteads from ad valorem taxation by a school district.

Contracts

• Real Estate Purchase Agreements: For closings occurring in 2025, proration clauses must be reviewed. Standard language may not adequately address who is entitled to the refund if the seller pays taxes based on the $100k exemption at closing, but the liability is retroactively reduced to the $140k level post-closing.

Hiring/Training

• Customer Service (Servicing): Train staff to handle borrower confusion in October 2025. Borrowers will likely receive tax bills that do not yet reflect the $140k exemption. Staff must be scripted to explain the "vote-then-adjust" process.
• Escrow Analysis: Staff must be trained on short-year statement generation to handle the off-cycle adjustment.

Reporting & Record-Keeping

• Escrow Refunds (RESPA): If the amendment passes, tax liabilities will drop. Servicers must perform off-cycle escrow analyses. Any surplus over $50 created by the retroactive tax cut must be refunded to the borrower within 30 days of the analysis.
• Closing Disclosures (CDs): For 2025 originations, continue to disclose "Projected Payments" based on current law ($100k exemption) to avoid under-collection, but document the potential reduction in the loan file.

Fees & Costs

• Administrative Overhead: Budget for increased mailing and processing costs in Q4 2025/Q1 2026 due to the requirement to send corrected escrow statements and refund checks.