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House Bill 1770 |
House Author: Miklos |
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Effective: 6-19-09 |
Senate Sponsor: Wentworth |
House Bill 1770 amends the Tax Code to authorize a municipality to designate a noncontiguous geographic area as a reinvestment zone under the Tax Increment Financing Act. It clarifies that an area designated as a reinvestment zone, whether contiguous under continuing law or noncontiguous under the bill, may be within the corporate limits of the municipality, within its extraterritorial jurisdiction (ETJ), or both. The bill establishes that the designation of an area located wholly or partly in an ETJ is not affected by the subsequent municipal annexation of real property in the zone. It provides that a reinvestment zone terminates on the earlier of the original date contained in the ordinance or order designating the zone, or an earlier or later termination date designated by a subsequent ordinance or order. Even if a later termination date ensues, however, there is no requirement that a taxing unit pay into the zone's tax increment fund after the originally specified date unless the taxing unit enters into an agreement to do so with the municipality or county that created the zone. The bill establishes that the amount of a taxing unit's increment for a given year is the amount of property taxes levied and assessed, or the amount levied and collected, by a taxing unit for that year on the captured appraised value of real property taxable by the unit and located in a reinvestment zone, and requires the taxing unit to choose one of the two options for calculation of the increment. Under prior law, the increment was the amount levied and collected. The bill prohibits a municipality from creating a reinvestment zone if the total appraised value of taxable real property in the proposed zone and in existing reinvestment zones exceeds 20 percent of the total appraised value of taxable real property in the municipality and in the industrial districts created by the municipality, if the municipality is the county seat of a county that is adjacent to a county with a population of 3.3 million or more, and if the county in which the municipality is located contains a planned community of 20,000 or more acres of land established originally under federal law and subject to restrictive covenants containing property or annual variable budget-based assessments on real property. The bill validates certain governmental acts and proceedings taken before June 19, 2009, and related to or associated with the extension of the term of a reinvestment zone.