73R10039 E
By Allen H.B. No. 1718
Substitute the following for H.B. No. 1718:
By Granoff C.S.H.B. No. 1718
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to work programs for inmates and former inmates of a
1-3 county jail or state prison.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 171, Tax Code, is amended by adding
1-6 Subchapter L to read as follows:
1-7 SUBCHAPTER L. TAX CREDIT FOR WAGES PAID TO INMATES
1-8 OR FORMER INMATES
1-9 Sec. 171.651. DEFINITIONS. In this subchapter:
1-10 (1) "Inmate" means an inmate in a prison industries
1-11 program operated by the prison industries office of the
1-12 institutional division under Subchapter A, Chapter 497, Government
1-13 Code.
1-14 (2) "Institutional division" means the institutional
1-15 division of the Texas Department of Criminal Justice.
1-16 Sec. 171.652. CREDIT. A corporation that meets the
1-17 eligibility requirements under this subchapter is entitled to a
1-18 credit in the amount allowed by this subchapter against the tax
1-19 imposed under this chapter.
1-20 Sec. 171.653. CREDIT FOR WAGES PAID TO AN INMATE. (a) The
1-21 amount of the credit for wages paid by a corporation to an inmate
1-22 is equal to 10 percent of that portion of the wages paid that the
1-23 institutional division apportions to the state under Section
1-24 497.004(b)(3), Government Code, as reimbursement for the cost of
2-1 the inmate's confinement.
2-2 (b) A corporation is eligible for the credit under this
2-3 section only if it receives before the due date of its franchise
2-4 tax report for the privilege period for which the credit is claimed
2-5 a written certification from the institutional division stating the
2-6 amount of the wages that the corporation paid to an inmate during
2-7 the privilege period and the amount of those wages that the
2-8 institutional division apportioned to the state as reimbursement
2-9 for the cost of the inmate's confinement.
2-10 Sec. 171.654. CREDIT FOR WAGES PAID TO AN EMPLOYEE WHO WAS
2-11 AN INMATE. (a) The amount of the credit for wages paid by a
2-12 corporation to an employee who was employed by the corporation when
2-13 the employee was an inmate is equal to 10 percent of that portion
2-14 of the wages paid that, were the employee still an inmate, the
2-15 institutional division would apportion to the state under Section
2-16 497.004(b)(3), Government Code, as reimbursement for the cost of
2-17 the inmate's confinement.
2-18 (b) A corporation is eligible for the credit under this
2-19 section only if:
2-20 (1) the employee who was formerly an inmate has been
2-21 continuously employed by the corporation for at least one year
2-22 after the date that the employee was released from prison;
2-23 (2) the nature of the employment is substantially
2-24 similar to the employment the employee had with the corporation
2-25 when the employee was an inmate or the employment requires more
2-26 skills or provides greater opportunities for the employee;
2-27 (3) the corporation has provided the institutional
3-1 division a statement of the amount of wages paid the employee
3-2 during the accounting period on which the credit is computed; and
3-3 (4) the corporation receives before the due date of
3-4 its franchise tax report for the privilege period for which the
3-5 credit is claimed a written certification from the institutional
3-6 division stating the amount of the wages that, were the employee
3-7 still an inmate, the institutional division would have apportioned
3-8 to the state as reimbursement for the cost of the inmate's
3-9 confinement.
3-10 (c) A corporation may claim a credit under this section only
3-11 for wages paid an employee after the employee has been employed by
3-12 the corporation for more than one year after the date of the
3-13 employee's release from prison.
3-14 Sec. 171.655. LIMITATION. The credit claimed for each
3-15 privilege period may not exceed 50 percent of the amount of net
3-16 franchise tax due for the privilege period after any other
3-17 applicable tax credits.
3-18 Sec. 171.656. APPLICATION FOR CREDIT. (a) A corporation
3-19 must apply for a credit under this subchapter on or with the tax
3-20 report for the period for which the credit is claimed.
3-21 (b) The comptroller shall promulgate a form for the
3-22 application for the credit. A corporation must use this form in
3-23 applying for the credit.
3-24 Sec. 171.657. PERIOD FOR WHICH CREDIT MAY BE CLAIMED. A
3-25 corporation may claim a credit under this subchapter for wages paid
3-26 during an accounting period only against the tax owed for the
3-27 corresponding privilege period.
4-1 SECTION 2. Subchapter A, Chapter 497, Government Code, is
4-2 amended by adding Section 497.009 to read as follows:
4-3 Sec. 497.009. CERTIFICATION FOR FRANCHISE TAX CREDIT. The
4-4 institutional division or the prison industries office on behalf of
4-5 the institutional division shall prepare and issue a certification
4-6 that a corporation requires to establish eligibility for the
4-7 franchise tax credit for wages paid to inmates or employees who
4-8 were inmates under Subchapter L, Chapter 171, Tax Code.
4-9 SECTION 3. Subchapter A, Chapter 497, Government Code, is
4-10 amended by adding Section 497.010 to read as follows:
4-11 Sec. 497.010. COMPLIANCE. The prison industries office may
4-12 enter into a contract with a private business under Section 497.006
4-13 only if the contract specifies that the prison industries office
4-14 and the private business will comply with the Private Sector/Prison
4-15 Industry Enhancement Certification Program operated by the Bureau
4-16 of Justice Assistance and authorized by 42 U.S.C. Sec. 3701 et seq.
4-17 SECTION 4. Section 497.022, Government Code, is amended to
4-18 read as follows:
4-19 Sec. 497.022. Purpose. The purpose of this subchapter is
4-20 to:
4-21 (1) provide adequate, regular, and suitable employment
4-22 for the vocational training and rehabilitation of inmates,
4-23 consistent with proper penal purposes;
4-24 (2) use the labor of inmates for self-maintenance;
4-25 (3) reimburse the state for expenses caused by the
4-26 crimes of inmates and the cost of their confinement; <and>
4-27 (4) provide for the requisition and disbursement of
5-1 institutional division articles and products through established
5-2 state authorities to eliminate the possibility of private profits
5-3 from the distribution of those articles and products; and
5-4 (5) provide materials, products, or articles for sale
5-5 to a private person or for the use of the state or a political
5-6 subdivision of the state.
5-7 SECTION 5. The Texas Unemployment Compensation Act (Article
5-8 5221b-1 et seq., Vernon's Texas Civil Statutes) is amended by
5-9 adding Section 7d to read as follows:
5-10 Sec. 7d. CREDIT FOR CONTRIBUTIONS PAID TO INMATES OR FORMER
5-11 INMATES. (a) In this section, "inmate" means an inmate in a
5-12 prison industries program operated by the prison industries office
5-13 of the institutional division of the Texas Department of Criminal
5-14 Justice under Subchapter A, Chapter 497, Government Code.
5-15 (b) An employer that meets the eligibility requirements
5-16 under this section is entitled to a credit in the amount allowed by
5-17 this section against contributions owed by the employer under
5-18 Section 7 of this Act.
5-19 (c) An employer is eligible for the credit under this
5-20 section for an employee if:
5-21 (1) the employee was continuously employed by the
5-22 employer for at least six months while the employee was an inmate;
5-23 (2) the employee has been continuously employed by the
5-24 corporation for at least one year after the date that the employee
5-25 was released from prison; and
5-26 (3) the nature of the employment is substantially
5-27 similar to the employment the employee had with the employer when
6-1 the employee was an inmate or the employment requires more skills
6-2 or provides greater opportunities for the employee.
6-3 (d) An employer who qualifies for a credit under this
6-4 section must apply to the Commission for the credit. The
6-5 Commission shall promulgate a form for the application for the
6-6 credit. An employer must use this form in applying for the credit.
6-7 (e) The amount of the credit is the amount of contributions
6-8 paid by the employer under Section 7 of this Act for the employee:
6-9 (1) while the employee was an inmate; and
6-10 (2) for one year after the date that the employee was
6-11 released from prison.
6-12 (f) The Commission shall apply the credit under this section
6-13 for contributions paid by the employer under Section 7 of this Act
6-14 for the employee against contributions that the employer owes for
6-15 the employee after the employee has been continuously employed by
6-16 the employer for one year after the date that the employee was
6-17 released from prison.
6-18 (g) A credit under this section is not transferable between
6-19 employees.
6-20 (h) An employee earns benefit wage credits for employment
6-21 during the period in which the employer receives a credit under
6-22 this section in the same manner and amount as if the employer paid
6-23 the full amount otherwise due under Section 7 of this Act.
6-24 SECTION 6. (a) A corporation may claim the credit under
6-25 Subchapter L, Chapter 171, Tax Code, as added by this Act, only for
6-26 any wages paid or incurred on or after the effective date of this
6-27 Act and only on a franchise tax report due under Chapter 171, Tax
7-1 Code, on or after January 1, 1994.
7-2 (b) An employer may claim the credit under Section 7d, Texas
7-3 Unemployment Compensation Act (Article 5221b-1 et seq., Vernon's
7-4 Texas Civil Statutes), as added by this Act, only for any
7-5 contributions paid under Section 7, Texas Unemployment Compensation
7-6 Act (Article 5221b-1 et seq., Vernon's Texas Civil Statutes), on or
7-7 after the effective date of this Act.
7-8 SECTION 7. The importance of this legislation and the
7-9 crowded condition of the calendars in both houses create an
7-10 emergency and an imperative public necessity that the
7-11 constitutional rule requiring bills to be read on three several
7-12 days in each house be suspended, and this rule is hereby suspended.