Relating to the authority of the governing body of a taxing unit to adopt an exemption from ad valorem taxation of a portion, expressed as a dollar amount, of the appraised value of an individual's residence homestead.

SB 634 allows local taxing units (like cities or counties) to create a fixed-dollar exemption for homeowners' primary residences, requiring a minimum $5,000 exemption per household. This exemption, adopted annually before July 1, applies to the appraised value of a homestead and stacks with existing exemptions under Texas law. The bill ensures this new exemption does not reduce state school funding calculations, as it explicitly excludes these fixed-dollar amounts when determining taxable property values for education funding under the Foundation School Program. Homeowners in communities that adopt this exemption will see reduced property taxes on their primary residence.