By Oliveira H.B. No. 2104
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the Texas Enterprise Zone Act
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Texas Enterprise Zone Act (Article 5190.7,
1-5 Vernon's Texas Civil Statutes) is amended to read as follows:
1-6 Section 1. SHORT TITLE. This Act shall be known and may be
1-7 cited as the Texas Enterprise Zone Act.
1-8 Section 2. LEGISLATIVE FINDINGS AND PURPOSE.
1-9 (a) The legislature finds that:
1-10 (1) the health, safety, and welfare of the people of
1-11 this state are dependent on the continual encouragement,
1-12 development, growth, and expansion of the private sector within
1-13 this state; and
1-14 (2) there are certain economically distressed
1-15 <depressed> urban and rural areas of this state that need the
1-16 particular attention of government.
1-17 (b) It is therefore the public policy of this state to
1-18 provide the people of this state with the necessary means to assist
1-19 communities, their residents, and the private sector to create the
1-20 proper economic and social environment to induce the investment of
1-21 private resources in productive business enterprises located in
1-22 severely distressed areas and to provide employment to residents of
1-23 those areas. In achieving this objective, through this Act the
2-1 state seeks to provide appropriate investments, tax benefits, and
2-2 regulatory relief to encourage the business community to commit its
2-3 financial participation. Accordingly, the legislature declares the
2-4 revitalization of enterprise zones through the concerted efforts of
2-5 government and the private sector to be a public purpose.
2-6 (c) It is the purpose of this Act to establish a process
2-7 that clearly identifies those distressed areas and provides
2-8 incentives by both state and local government to induce private
2-9 investment in those areas by means of the removal of unnecessary
2-10 governmental regulatory barriers to economic growth and the
2-11 provision of tax incentives and economic development program
2-12 benefits.
2-13 Sec. 3. Definitions. (a) In this Act:
2-14 (1) "Administrative authority" means a board,
2-15 commission, or committee appointed by a governing body to
2-16 administer this Act in a local enterprise zone.
2-17 (2) "Day" means the period of time between 8 a.m. and
2-18 5 p.m. on any day other than a Saturday, Sunday, or state or
2-19 federal holiday.
2-20 (3) "Department" means the Texas Department of
2-21 Commerce.
2-22 (4) "Economically distressed" <"Depressed area"> means
2-23 an area within the jurisdiction of a county or municipality
2-24 designated by ordinance or order and that meets the criteria set by
2-25 this Act.
3-1 (5) "Economically disadvantaged individual" means an
3-2 individual who:
3-3 (A) for at least three months before obtaining
3-4 employment with a qualified business was unemployed;
3-5 (B) receives public assistance benefits, such as
3-6 welfare payments and food stamp payments, based on need and
3-7 intended to alleviate poverty;
3-8 (C) is an economically disadvantaged individual,
3-9 as defined by Section 4(8), Job Training Partnership Act (29 U.S.C.
3-10 Section 1503(8));
3-11 (D) is an individual with handicaps, as defined
3-12 by 29 U.S.C. Section 706(8);
3-13 (E) is an individual who is an inmate, as
3-14 defined by Section 498.001, Government Code, or who is entering the
3-15 workplace after being confined in a unit of the institutional
3-16 division of the Texas Department of Criminal Justice or a
3-17 correctional facility authorized by Chapter 494 <495>, Government
3-18 Code; <or>
3-19 (F) is an individual who meets the current low
3-20 income or moderate income limits developed under Section 8, United
3-21 States Housing Act of 1937 (42 U.S.C. Section 1437f); or
3-22 (G) is an individual who meets the
3-23 qualifications for the Targeted Jobs Tax Credit developed under the
3-24 Tax Reform Act of 1986.
3-25 (6) "Enterprise project" means a qualified business
4-1 designated by the department as an enterprise project under Section
4-2 10 of this Act that is eligible for the state tax incentives
4-3 provided by law for an enterprise project.
4-4 (7) "Enterprise zone" means an area of the state
4-5 designated by the department as an enterprise zone under Section 9
4-6 of this Act.
4-7 (8) Enterprise Zone Special Needs Fund" means a
4-8 performance-based fund to be derived from gains in state sales and
4-9 use tax revenues for the state resulting from investment encouraged
4-10 by the Act and to be administered by the department in accordance
4-11 with Section 8 of the Act.
4-12 (9) <(8)> "Governing body" with respect to an
4-13 enterprise zone means the governing body of a municipality or
4-14 county that has applied to have an area within its jurisdiction
4-15 designated as an enterprise zone.
4-16 (10) <(9)> "Neighborhood enterprise association" means
4-17 a private sector neighborhood organization within an enterprise
4-18 zone that meets the criteria set by this Act.
4-19 (11) <(10)> "New permanent job" means a new employment
4-20 position that is:
4-21 (A) created by a qualified business that has
4-22 provided employment to a qualified employee of at least 1,040 hours
4-23 annually; and
4-24 (B) intended to be an employment position
4-25 retained during the period the business is designated as an
5-1 enterprise project.
5-2 (12) <(11)> "Qualified business" means a person,
5-3 including a corporation or other entity, that the department, for
5-4 purposes of state benefits under this Act, and a governing body,
5-5 for purposes of local benefits, certifies to have met the following
5-6 criteria:
5-7 (A) the person is engaged in or has provided
5-8 substantial commitment to initiate the active conduct of a trade or
5-9 business in a state or federally designated enterprise zone or in
5-10 an area not designated as an enterprise zone in a city or county
5-11 that contains a state or federally designated enterprise <the>
5-12 zone; and
5-13 (B) at least 25 percent of the business's new
5-14 employees in the applicable jurisdiction of the enterprise zone
5-15 governing body or bodies or enterprise zone are residents of any
5-16 zone within the governing body's or bodies' jurisdiction or
5-17 economically disadvantaged individuals.
5-18 (13) <(12)> "Qualified employee" means an employee who
5-19 works for a qualified business and who performs at least 50 percent
5-20 of his service for the business within the enterprise zone or for a
5-21 state designated enterprise project located in a city or county
5-22 that contains a state or federally designated enterprise zone.
5-23 (14) <(13)> "Qualified property" means:
5-24 (A) tangible personal property located in the
5-25 zone that was acquired by a taxpayer not earlier than the 90th day
6-1 before the date of designation of the area as an enterprise zone
6-2 and was used predominantly by the taxpayer in the active conduct of
6-3 a trade or business;
6-4 (B) real property located in a zone that:
6-5 (i) was acquired by the taxpayer not earlier than the 90th
6-6 day before the date of designation of the zone and used
6-7 predominantly by the taxpayer in the active conduct of a trade or
6-8 business; or
6-9 (ii) was the principal residence of the taxpayer on the date
6-10 of the sale or exchange; or
6-11 (C) interest in a corporation, partnership, or
6-12 other entity if, for the most recent taxable year of the entity
6-13 ending before the date of sale or exchange, the entity was a
6-14 qualified business.
6-15 (15) "Retained Job" means a job that has been in
6-16 existence in the state before certification of a business as a
6-17 qualified business under the definition of this Act and that
6-18 provides at least 1,820 hours of work to a qualified employee
6-19 before state benefits under the Act are provided.
6-20 (b) For purposes of this Act, territory in the
6-21 extraterritorial jurisdiction of a municipality is considered to be
6-22 in the jurisdiction of the municipality.
6-23 (c) A franchise or subsidiary of a new or existing business
6-24 may be certified by the governing body of an enterprise zone as a
6-25 qualified business if the franchise or subsidiary is located
7-1 entirely in the zone or is located within the jurisdiction of the
7-2 governing body or bodies of an enterprise zone and has been
7-3 designated by the state as an enterprise project and maintains
7-4 separate books and records of the business activity conducted in
7-5 the zone.
7-6 Sec. 4. Criteria for Designation of Enterprise Zone.
7-7 (a) An area of a municipality, county, or combination of these
7-8 local governments may be designated as an enterprise zone if it:
7-9 (1) has a continuous boundary;
7-10 (2) is at least one square mile in size but does not
7-11 exceed the larger of the following:
7-12 (A) 10 square miles (exclusive of lakes,
7-13 waterways, and transportation arteries); or
7-14 (B) five percent of the area of the
7-15 municipality, county, or combination of municipalities or counties
7-16 nominating the area as an enterprise zone, but not more than 20
7-17 square miles (exclusive of lakes, waterways, and transportation
7-18 arteries);
7-19 (3) has been nominated as an enterprise zone in an
7-20 ordinance or order adopted by the legislative body of the
7-21 applicable municipality, county, or combination of municipalities
7-22 or counties; and
7-23 (4) is an area with pervasive poverty, unemployment,
7-24 and economic distress.
7-25 (b) An area is an area of pervasive poverty, unemployment,
8-1 and economic distress if the average rate of unemployment in the
8-2 area during the most recent 12-month period for which data is
8-3 available was at least one and one-half times the local, state, or
8-4 national average for that period or if the area has had at least a
8-5 nine percent population loss during the most recent six-year period
8-6 or a population loss of at least three percent for the most recent
8-7 three-year period and the area meets one or more of the following
8-8 criteria:
8-9 (1) the area was a low-income poverty area;
8-10 (2) the area is in a jurisdiction or pocket of poverty
8-11 eligible for urban development action grants under federal law,
8-12 according to the most recent certification available from the
8-13 United States Department of Housing and Urban Development;
8-14 (3) at least 70 percent of the residents or households
8-15 of the area have an income below 80 percent of the median income of
8-16 the residents or households of the locality or state, whichever is
8-17 lower; or
8-18 (4) the nominating government establishes to the
8-19 satisfaction of the department that either:
8-20 (A) chronic abandonment or demolition of
8-21 commercial or residential structures exists in the area;
8-22 (B) substantial tax arrearages for commercial or
8-23 residential structures exist in the area;
8-24 (C) substantial losses of businesses or jobs
8-25 exist in the area; or
9-1 (D) the area is part of a disaster area declared
9-2 by the state or federal government during the most recent 18-month
9-3 period.
9-4 (c) An area may be designated as an enterprise zone for a
9-5 maximum period of seven years. A designation remains in effect
9-6 until September 1 of the final year of the designation. However,
9-7 if an area is designated as a federal enterprise zone, the area may
9-8 be designated for a longer period not to exceed that permitted by
9-9 federal law.
9-10 (d) If an enterprise zone has been lawfully designated, the
9-11 original nominating governing body or bodies, by ordinance or
9-12 order, as appropriate, adopted following public hearing, may amend
9-13 the original boundaries subject to the following limitations:
9-14 (1) the boundaries as amended must not exceed the
9-15 original size limitations and boundary requirements set by this Act
9-16 and may not exclude any part of the zone within the boundaries as
9-17 originally designated;
9-18 (2) the enterprise zone must continue to meet all
9-19 unemployment and economic distress criteria throughout the zone as
9-20 required by this Act;
9-21 (3) the governing body or bodies may not make more
9-22 than one boundary amendment annually during the zone designation
9-23 period; and
9-24 (4) the governing body or bodies must pay for
9-25 amendment a reasonable fee in an amount not to exceed $500 as
10-1 specified by the department.
10-2 (e) The department may designate as an enterprise zone a
10-3 national defense base announced for closure in this state for full
10-4 benefits under this Act upon application for designation. The
10-5 application to nominate to the department the land area of the
10-6 defense base by ordinance or order, as applicable, must be
10-7 submitted by the Base Closure Transition Authority recognized by
10-8 the Department of Defense. Application guidelines must be followed
10-9 as set forth for enterprise zones with the exception that size and
10-10 qualifying criteria under section 4 of this Act will not apply and
10-11 territory in such zones will be deemed to be in the jurisdiction of
10-12 the recognized Base Closure Transition Authority and nomination
10-13 contrary thereto under Section 5 of the Act will not apply.
10-14 Designation will carry all benefits defined in this Act including
10-15 enterprise project designation eligibility and will not count as
10-16 one of the applicant governing body's three enterprise zone
10-17 designations allowed under Section 9 of the Act.
10-18 (f) <(e)> The department may remove the designation of any
10-19 area as an enterprise zone if the area no longer meets the criteria
10-20 for designation as set out in this Act or by rule adopted under
10-21 this Act by the department or if the department determines that the
10-22 governing body has not complied with commitments made in the
10-23 resolution nominating the area as a reinvestment zone. The removal
10-24 of a designation does not affect the validity of any tax incentives
10-25 or regulatory relief granted or accrued before the removal or of
11-1 any bonds issued under this Act.
11-2 (g) <(f)> The department is authorized to use fees collected
11-3 under this section for administration and other purposes to further
11-4 advance this Act.
11-5 Sec. 5. Nomination by Counties and Municipalities. (a) The
11-6 governing body of any municipality, county, or combination of these
11-7 local governments may nominate by ordinance or order, as
11-8 appropriate, any economically distressed area within its
11-9 jurisdiction as a potential enterprise zone, if the area meets the
11-10 criteria established in Section 4 of this Act. The municipality,
11-11 county, or combination of these local governments may then make
11-12 written application to the department to have the area designated
11-13 as an enterprise zone.
11-14 (b) An ordinance or order adopted by a governing body under
11-15 this section is not valid unless the governing body holds a public
11-16 hearing to consider the ordinance or order before the ordinance or
11-17 order is adopted.
11-18 (c) Except as provided by Subsection (e) of this section,
11-19 the governing body of a county may not nominate territory in a
11-20 municipality or in the extraterritorial jurisdiction of a
11-21 municipality to be included in an enterprise zone or nominate a
11-22 qualified business for enterprise project designation unless the
11-23 governing body of the municipality also nominates the territory or
11-24 qualified business pursuant to a joint application made with the
11-25 county.
12-1 (d) Except as provided by Subsection (e) of this section, a
12-2 combination of municipalities or counties may not jointly nominate
12-3 an area as an enterprise zone unless the governing bodies have
12-4 entered into binding agreements providing for the joint
12-5 administration of the zone or enterprise project.
12-6 (e) The governing body of a county with a population of
12-7 750,000 or more, according to the most recent federal census, may
12-8 nominate territory in the county that is in the extraterritorial
12-9 jurisdiction of a municipality to be included in one or more of the
12-10 county's allotted enterprise zones. If a county nominates
12-11 territory for inclusion in an enterprise zone under this subsection
12-12 and the zone is established under this Act, the county shall
12-13 administer the zone.
12-14 Sec. 6. Requirements of Ordinance or Order Nominating Zone.
12-15 (a) An ordinance or order nominating an area as an enterprise zone
12-16 must set forth:
12-17 (1) a precise description of the area comprising the
12-18 zone, either in the form of a legal description or by reference to
12-19 roadways, lakes and waterways, and municipal or county boundaries;
12-20 (2) a finding that the zone area meets the
12-21 qualifications of this Act;
12-22 (3) a brief summary of provisions for any tax or other
12-23 incentives applicable to business enterprises in the zone at the
12-24 election of the designating municipality or county, at least one of
12-25 which is not applicable throughout the municipality or county; and
13-1 (4) a designation of the area as an enterprise zone,
13-2 subject to the approval of the department in accordance with this
13-3 Act.
13-4 (b) This section does not prohibit a municipality or county
13-5 from extending additional tax or other incentives for business
13-6 enterprises in an enterprise zone by separate ordinance or order.
13-7 Sec. 7. Application for Designation of Zone. (a) The
13-8 governing body of a municipality or county or the governing bodies
13-9 of a combination of municipalities or counties nominating an area
13-10 as an enterprise zone may make a written application to the
13-11 department to designate the area as an enterprise zone.
13-12 (b) The application must include:
13-13 (1) a certified copy of the ordinance or order, as
13-14 appropriate, nominating the proposed zone;
13-15 (2) a map of the proposed enterprise zone showing
13-16 existing streets and highways;
13-17 (3) an analysis and any appropriate supporting
13-18 documents and statistics demonstrating that the proposed zone area
13-19 qualifies for designation as an enterprise zone;
13-20 (4) a statement detailing any tax, grant, and other
13-21 financial incentives or benefits and any programs to be provided by
13-22 the municipality or county to business enterprises in the zone that
13-23 are not to be provided throughout the municipality or county;
13-24 (5) a statement setting forth the economic development
13-25 and planning objectives for the zone;
14-1 (6) a statement describing the functions, programs,
14-2 and services to be performed by designated neighborhood enterprise
14-3 associations in the zone;
14-4 (7) an estimate of the economic impact of the zone,
14-5 considering all of the tax incentives, financial benefits, and
14-6 programs contemplated, on the revenues of the municipality or
14-7 county;
14-8 (8) a transcript or tape recording of all public
14-9 hearings on the zone;
14-10 (9) in the case of a joint application, a description
14-11 and copy of the agreement between joint applicants;
14-12 (10) procedures for negotiating with residents,
14-13 community groups, and other entities affected by the zone and with
14-14 qualified businesses in the zone;
14-15 (11) a description of the administrative authority, if
14-16 any, created for the zone; and
14-17 (12) any additional information that the department
14-18 requires.
14-19 (c) Information required by Subsection (b) of this section
14-20 to be provided in an application under this section is for
14-21 evaluation purposes only. The department may reject an application
14-22 only if the department determines that the nominated area does not
14-23 satisfy the criteria established by Section 4 of this Act.
14-24 Sec. 8. Powers and Duties of the Department. (a) The
14-25 department shall administer this Act and shall:
15-1 (1) establish criteria and procedures for designating
15-2 qualified areas as enterprise zones, national defense bases
15-3 federally announced for closure as enterprise zones in accordance
15-4 with this Act, and for designating enterprise projects;
15-5 (2) monitor the implementation of this Act and submit
15-6 an annual report evaluating the effectiveness of the program and
15-7 describing the use and revenue impact of state and local incentives
15-8 under this Act and making suggestions for legislation to the
15-9 governor, legislature, and the Legislative Budget Board by December
15-10 1 of each year;
15-11 (3) conduct a continuing evaluation of the programs of
15-12 enterprise zones and develop data based on any available
15-13 information demonstrating the relationship between the incentives
15-14 provided by this Act and the economy;
15-15 (4) adopt all rules necessary to carry out the
15-16 purposes of this Act;
15-17 (5) assist units of local government in obtaining
15-18 status as a federal enterprise zone;
15-19 (6) assist qualified employers in obtaining the
15-20 benefits of any incentive or inducement program provided by law;
15-21 and
15-22 (7) assist the governing body of an enterprise zone in
15-23 obtaining assistance from any other agency of state government,
15-24 including assistance in providing training and technical assistance
15-25 to qualified businesses in a zone.
16-1 (b) The department shall provide information and appropriate
16-2 assistance to persons desiring to locate and engage in business in
16-3 an enterprise zone regarding state licenses, permits, certificates,
16-4 approvals, registrations, and charters, along with other forms of
16-5 permission required by law to engage in business in the state.
16-6 (c) The department shall, in cooperation with appropriate
16-7 units of local government and state agencies, coordinate and
16-8 streamline existing state business assistance programs and permit
16-9 and license application procedures for businesses in enterprise
16-10 zones.
16-11 (d) The department shall publicize existing tax incentives
16-12 and economic development programs within enterprise zones and on
16-13 request offer technical assistance in abatement and alternative
16-14 revenue source development to local units of government that have
16-15 enterprise zones within their jurisdictions.
16-16 (e) The department shall work together with the responsible
16-17 state and federal agencies to promote the coordination of other
16-18 relevant programs, including but not limited to housing, community
16-19 and economic development, small business, banking, financial
16-20 assistance, and employment training programs that are carried on in
16-21 an enterprise zone.
16-22 (1) The department shall have authority to establish
16-23 an Enterprise Zone Special Needs Fund for which its purpose is to
16-24 fuel financial capability to department and other agency programs
16-25 and services to advance the purposes of the Act and to provide
17-1 performance-based funding to administer the Enterprise Zone Program
17-2 and coordinated programs as appropriate.
17-3 (2) Funding source:
17-4 (A) The basis of the fund will be state sales
17-5 and use tax revenues gained for the state from enterprise projects
17-6 for the remaining life of the designated projects and projects
17-7 designated after the date the fund authority become effective. The
17-8 Comptroller shall calculate the amount of state sales and use taxes
17-9 paid to the state by state designated enterprise projects from
17-10 reports filed with the Comptroller by enterprise projects seeking
17-11 refund benefits. On the first day of each month, the Comptroller
17-12 shall transfer to the department an amount equal to ten percent of
17-13 the state sales and use taxes paid by designated enterprise
17-14 projects to the state for investments of building materials and
17-15 machinery and equipment for use in the zone or in an enterprise
17-16 project designated within the jurisdiction of an enterprise zone
17-17 governing body.
17-18 (B) The Comptroller shall annually report to the
17-19 department by August 1 the amount of state sales and use tax
17-20 reported paid to the state by designated enterprise projects
17-21 estimated to be available for the next fiscal year effective
17-22 immediately upon adoption of authority within the Act to establish
17-23 the Enterprise Zone Special Needs Fund.
17-24 (3) Fund Administration:
17-25 (A) The department is authorized to utilize, in
18-1 its initial year of implementation of the fund, an amount of the
18-2 fund to administer the Enterprise Zone Program equal to the
18-3 Enterprise Zone Program budget for the previous year, but shall use
18-4 no more than ten percent of the fund for administration or
18-5 promotional purposes to advance the purpose of the Act in
18-6 subsequent years.
18-7 (B) The department may expend proceeds of the
18-8 Enterprise Zone Special Needs Fund effective September 1, 1993, and
18-9 shall have authority to carry forward uncommitted monies remaining
18-10 in the fund to subsequent years.
18-11 (C) The department, where possible, will fuel
18-12 existing programs of the department, other state agencies, and
18-13 local taxing entities or may leverage the impact of the funds
18-14 through public and private resources to advance the purposes of the
18-15 Act. Examples of application of funds include providing for
18-16 programs administered by the state for special education and
18-17 training relevant to enterprise zone residents and economically
18-18 disadvantaged persons defined within the Act, day care,
18-19 infrastructure, housing including homestead programs, business
18-20 incubators, energy conservation, environmental protection including
18-21 recycling projects, and to provide direct technical assistance or
18-22 other specific needs that will advance enterprise zones toward
18-23 meeting their specific socioeconomic objectives within the purposes
18-24 of the Act. Participating agencies shall have the authority to use
18-25 no more than two percent of the funds received from the department
19-1 to administer the applicable program or services to be provided
19-2 through an existing program.
19-3 (D) The department may design and implement new
19-4 programs identified for the purpose of maximizing opportunities to
19-5 assist enterprise zone objectives to encourage creation of new
19-6 permanent jobs for residents of the state and to encourage
19-7 retention of existing jobs.
19-8 (E) The department shall provide the Comptroller
19-9 with the cooperation and assistance needed to determine the amount
19-10 due the fund.
19-11 (f) The department shall assist the governing body of an
19-12 enterprise zone in the development of small business incubators.
19-13 (g) The department shall review local incentives every two
19-14 years.
19-15 (h) The department shall prohibit the certification of any
19-16 future qualified businesses in the jurisdiction of an enterprise
19-17 zone governing body or bodies <an enterprise zone> if it determines
19-18 the governing body is not in compliance with any provision of this
19-19 Act until it determines that the governing body is in compliance.
19-20 Sec. 9. Designation of Zones by Department. (a) On receipt
19-21 of an application from a municipality, county, or combination of
19-22 these local governments, the department shall review the
19-23 application to determine if the area described in the application
19-24 qualifies to be designated as an enterprise zone under the criteria
19-25 of Section 4 of this Act. The department shall provide an
20-1 applicant at least 10 days after the date of receipt of the
20-2 application to correct any omissions or clerical errors that may be
20-3 present in the application and to return the application to the
20-4 department. Following the close of the application period and the
20-5 resubmission period, if any, the department shall meet to review
20-6 the applications that have qualified for consideration as
20-7 enterprise zones.
20-8 (b) Not later than the 60th day after the last day of each
20-9 fiscal year, the comptroller shall furnish to the department a
20-10 report stating the statewide total of the tax refunds made under
20-11 Section 17 of this Act during the fiscal year.
20-12 (c) If the department determines that the nominated area
20-13 satisfies the criteria established by Section 4 of this Act, the
20-14 department shall begin negotiations for agreements with the
20-15 governing body or bodies filing the application. A negotiated
20-16 agreement must designate the enterprise zone. A negotiated
20-17 agreement must designate the administrative authority, if any, and
20-18 its functions and duties. The department shall complete the
20-19 negotiations and sign the agreements not later than the 60th day
20-20 after the day of receipt of the application. The department may
20-21 extend this deadline for an additional 30 days. If an agreement is
20-22 not completed within the stated period, the department shall
20-23 provide the applicant with the specific areas of concern and a
20-24 final proposal for the agreement. If the agreement is not executed
20-25 before the 90th day after the day of the receipt of the application
21-1 by the department, the application is considered to be denied. The
21-2 department shall inform the governing body or bodies of the
21-3 specific reasons for the denial.
21-4 (d) The department may not designate an area as an
21-5 enterprise zone if in the jurisdiction of the municipality or
21-6 county nominating the area as an enterprise zone there are three
21-7 enterprise zones in existence that were nominated as enterprise
21-8 zones by the governing body of that municipality or county with the
21-9 exception that a national defense base facility announced by the
21-10 federal government for closure may be designated an enterprise zone
21-11 not to be counted as one of the three enterprise zones allowed a
21-12 jurisdiction.
21-13 Sec. 10. Designation of Enterprise Project. (a) A
21-14 qualified business in a jurisdiction of an enterprise zone
21-15 governing body that meets requirements of the department for
21-16 special assistance under the Enterprise Zone Special Needs Fund or
21-17 in an enterprise zone having an unemployment rate of not less than
21-18 one and one-half times the state average, a population loss of at
21-19 least 12 percent during the most recent six-year period, <or> a
21-20 population loss of at least four percent for the most recent
21-21 three-year period, or that qualified for enterprise zone
21-22 designation as a national defense base facility announced by the
21-23 federal government for closure, may apply to the governing body or
21-24 combination of governing bodies that nominated the enterprise zone
21-25 and to the administrative authority, if any, for designation as an
22-1 enterprise project. If the governing body or bodies and
22-2 administrative authority agree, the governing body or bodies may
22-3 apply to the department to designate the business as an enterprise
22-4 project.
22-5 (b) The application to the department must include:
22-6 (1) a complete description of the conditions in the
22-7 zone that constitute pervasive poverty, unemployment, and economic
22-8 distress for purposes of Subsection (b) of Section 4 of this Act or
22-9 reasons why the applicant cannot locate within the zone but will
22-10 provide benefit to zone residents if designated an enterprise
22-11 project;
22-12 (2) a description of each municipality's or county's
22-13 procedures and efforts to facilitate and encourage participation by
22-14 and negotiation between all affected entities in the zone in which
22-15 the qualified business is located;
22-16 (3) an economic analysis of the plans of the qualified
22-17 business for expansion, revitalization, or other activity in the
22-18 zone, including the anticipated number of new permanent jobs it
22-19 will create, the anticipated number of permanent jobs it will
22-20 retain, criteria met to qualify for benefits for enterprise project
22-21 designation for jobs retained as set forth in the program rules by
22-22 the department, the amount of investment to be made in the zone,
22-23 and other information that the department requires; and
22-24 (4) a description of the local effort made by the
22-25 municipality or county, the administrative authority, the qualified
23-1 business, and other affected entities to achieve development and
23-2 revitalization of the zone.
23-3 (c) The department may not designate a nominated qualified
23-4 business as an enterprise project unless it determines that:
23-5 (1) the qualified business is located in or has made a
23-6 substantial commitment to locate in an enterprise zone having an
23-7 unemployment rate of not less than one and one-half times the state
23-8 unemployment rate, or a population loss of at least 12 percent
23-9 during the most recent six-year period, or a population loss of at
23-10 least four percent for the most recent three-year period;
23-11 (2) the applicant governing body or bodies have
23-12 demonstrated that a high level of cooperation between public,
23-13 private, and neighborhood entities exists in the zone; and
23-14 (3) the designation of the qualified business as an
23-15 enterprise project will contribute significantly to the achievement
23-16 of the plans of the applicant governing body or bodies for
23-17 development and revitalization of the zone.
23-18 (d) The department shall designate qualified businesses as
23-19 enterprise projects with benefits for creation of new permanent
23-20 jobs or in accordance with qualifying criteria established by
23-21 program rules for retaining permanent jobs. <on a competitive
23-22 basis>. In designating enterprise projects, the department shall
23-23 base its decision on a weighted scale with 60 percent dependent on
23-24 the economic distress of the enterprise zone in which a proposed
23-25 enterprise project is located and 40 percent dependent on the local
24-1 effort to achieve development and revitalization of the enterprise
24-2 zone.
24-3 (e) Unless the designation is removed under Subsection (g)
24-4 of this section before that date, the designation of an enterprise
24-5 project is effective for five years after the date the designation
24-6 is made.
24-7 (f) The department shall allocate to each enterprise project
24-8 at the time of its designation a job ceiling number representing
24-9 the maximum number of new permanent jobs or retained jobs eligible
24-10 to be included in any calculation for a tax refund for the
24-11 enterprise project. The job ceiling number for a project may not
24-12 exceed 625 or a number equal to 110 percent of the number of
24-13 retained jobs or new permanent jobs that a qualified business in
24-14 its application for designation commits to retain or create, as
24-15 applicable, during the five-year term of its designation as an
24-16 enterprise project, whichever is less. <The maximum number of new
24-17 permanent jobs that may be allocated by the department among all
24-18 enterprise projects designated under this section between August
24-19 31, 1991 and August 31, 1993 is 10,000>.
24-20 (g) The department may remove the designation of a qualified
24-21 business as an enterprise project if it determines that the
24-22 qualified business is not in compliance with any requirement for
24-23 designation as an enterprise project.
24-24 (h) For purposes of this section, local effort to achieve
24-25 development and revitalization of an enterprise zone means the
25-1 willingness of public entities in the zone to provide services,
25-2 incentives, and regulatory relief authorized by this Act or other
25-3 law and to negotiate with the qualified business for whom the
25-4 application is made for designation as an enterprise project and
25-5 with neighborhood enterprise associations and other local groups or
25-6 businesses to achieve the public purposes of this Act and the
25-7 effort of the qualified business and other affected entities to
25-8 cooperate in achieving those public purposes.
25-9 (i) Factors to be considered in evaluating the local effort
25-10 on the part of a public entity include:
25-11 (1) tax abatement, deferral, refunds, or other tax
25-12 incentives;
25-13 (2) regulatory relief, including:
25-14 (A) zoning changes or variances;
25-15 (B) exemptions from unnecessary building code
25-16 requirements; and
25-17 (C) streamlined permitting;
25-18 (3) enhanced municipal services, including:
25-19 (A) improved police and fire protection;
25-20 (B) institution of community crime prevention
25-21 programs; and
25-22 (C) special public transit routes or reduced
25-23 fares;
25-24 (4) improvements in community facilities, including:
25-25 (A) capital improvements in water and sewer
26-1 facilities;
26-2 (B) road repair; and
26-3 (C) creation or improvement of parks;
26-4 (5) improvements to housing, including:
26-5 (A) low interest loans for housing
26-6 rehabilitation or improvement; and
26-7 (B) transfer of abandoned housing to individuals
26-8 or community groups;
26-9 (6) business and industrial development services,
26-10 including:
26-11 (A) low interest loans for business;
26-12 (B) use of surplus school buildings or other
26-13 underutilized publicly owned facilities as small business
26-14 incubators;
26-15 (C) provision of publicly owned land for
26-16 development purposes;
26-17 (D) creation of special one-stop permitting and
26-18 problem resolution centers or ombudsmen; and
26-19 (E) promotion and marketing services; and
26-20 (7) job training and employment services, including:
26-21 (A) retraining programs;
26-22 (B) literacy and employment skills programs;
26-23 (C) vocational education; <and>
26-24 (D) customized job training; and
26-25 (E) environmental protection programs including
27-1 recycling.
27-2 (j) Factors to be considered in evaluating the local effort
27-3 on the part of private entities include:
27-4 (1) the willingness to negotiate or cooperate in the
27-5 achievement of the purposes of this Act;
27-6 (2) commitments to hire underskilled, inexperienced,
27-7 disadvantaged, or displaced workers resident in the zone;
27-8 (3) commitments to hire minority workers and to
27-9 contract with minority-owned businesses; and
27-10 (4) the willingness to make contributions to the
27-11 well-being of the community, such as job training, environmental
27-12 protection efforts including recycling, the donation of land for
27-13 parks or other public purposes, or the provision of child care for
27-14 employees.
27-15 <(k) The number of new permanent jobs that have not been
27-16 allocated before the end of each state fiscal year may be allocated
27-17 in subsequent fiscal years, except that an enterprise project may
27-18 not be designated after August 31, 1993.>
27-19 Sec. 11. Reinvestment Zone. An enterprise zone may be
27-20 designated a reinvestment zone for tax increment financing purposes
27-21 as provided by the Tax Increment Financing Act (Chapter 311, Tax
27-22 Code). For the purposes of tax abatement under the Property
27-23 Redevelopment and Tax Abatement Act (Chapter 312, Tax Code), an
27-24 enterprise zone is considered to be a reinvestment zone without
27-25 further designation.
28-1 Sec. 12. Refund of Sales and Use Tax. (a) To encourage the
28-2 development of areas designated as enterprise zones, a municipality
28-3 may establish a program to refund its local sales and use taxes
28-4 paid by a business on the purchase, lease, or rental of equipment
28-5 or machinery for use in an enterprise zone or on the purchase of
28-6 material for use in remodeling, rehabilitating, or constructing a
28-7 structure in an enterprise zone.
28-8 (b) In addition to the program authorized by Subsection (a)
28-9 of this section, to promote the public health, safety, or welfare,
28-10 the governing body of a municipality or county may establish a
28-11 program to refund its local sales and use taxes paid by a qualified
28-12 business or qualified employee.
28-13 (c) The governing body of a municipality or county that
28-14 nominated an enterprise zone designated by the department may
28-15 provide for the partial or total refund of its local sales and use
28-16 taxes paid by a person making a taxable purchase, lease, or rental
28-17 for purposes of development or revitalization in the zone.
28-18 (d) A qualified business, qualified employee, or person
28-19 entitled to a refund of local sales and use taxes under this
28-20 section shall pay the entire amount of state and local sales and
28-21 use taxes at the time they would otherwise be due without reduction
28-22 because of any agreement with a municipality or county for the
28-23 refund of local sales and use taxes.
28-24 (e) Any agreement to refund local sales and use taxes under
28-25 this section must be in writing, contain an expiration date, and
29-1 require the beneficiary to provide documentation necessary to
29-2 support a refund claim to the municipality or county granting the
29-3 refund. The municipality or county granting a refund shall make
29-4 the refund directly to the beneficiary in the manner set out in the
29-5 agreement.
29-6 Sec. 13. Reduction or Elimination of Fees and Taxes. To
29-7 promote the public health, safety, or welfare, the governing body
29-8 of a municipality or county may establish a program by which it
29-9 reduces or eliminates any fees or taxes, other than sales and use
29-10 or property taxes, that it imposes on a qualified business or
29-11 qualified employee. The governing body of a municipality or county
29-12 may not reduce or eliminate local sales and use taxes except to the
29-13 extent it grants a refund under Section 12 of this Act.
29-14 Sec. 14. Other Local Incentives. The governing body of a
29-15 municipality or county that nominated an enterprise zone designated
29-16 by the department or an enterprise project within the jurisdiction
29-17 of an enterprise zone governing body that satisfies the criteria
29-18 set by the department for assistance under the Enterprise Zone
29-19 Special Needs Fund may:
29-20 (1) defer compliance in the zone with subdivision and
29-21 development ordinances and regulations, other than those governing
29-22 streets and roads or sewer or water services;
29-23 (2) give priority to the zone for the receipt of urban
29-24 development action grant money, community development block grant
29-25 money, industrial revenue bonds, or funds received under the Texas
30-1 Job-Training Partnership Act (Article 4413(52), Vernon's Texas
30-2 Civil Statutes);
30-3 (3) adopt and implement a plan for police protection
30-4 in the zone;
30-5 (4) amend zoning ordinances to promote economic
30-6 development in the zone;
30-7 (5) establish preferences for businesses qualified for
30-8 assistance within the Act <in the zone in permit processes>;
30-9 (6) establish simplified, accelerated, or other
30-10 special permit procedures for businesses qualified for assistance
30-11 within the Act <in the zone>;
30-12 (7) waive development fees for projects in the zone;
30-13 (8) create a local enterprise zone fund for funding
30-14 bonds or other programs or activities to develop or revitalize the
30-15 zone;
30-16 (9) reduce utility rates for qualified businesses in
30-17 the zone charged by:
30-18 (A) utilities owned by the municipality or
30-19 county; or
30-20 (B) subject to agreement of the affected utility
30-21 and the approval of the appropriate regulatory authority under
30-22 Sections 16 and 17, Public Utility Regulatory Act (Article 1446c,
30-23 Vernon's Texas Civil Statutes), by a cooperative or a utility owned
30-24 by private investors except that rates of the utility for qualified
30-25 businesses in the zone may not be reduced more than five percent
31-1 and the appropriate regulatory authority in setting the rates of
31-2 the utility shall allow the utility to recover the amount of the
31-3 reduction;
31-4 (10) give priority to persons or projects in the zone
31-5 in issuing housing finance bonds;
31-6 (11) give priority in providing services to local
31-7 economic development, educational, job training, day care, energy
31-8 conservation and environmental protection including recycling or
31-9 transportation programs that benefit the zone; or
31-10 (12) sell real property owned by the municipality,
31-11 <or> county or other taxing entities and located in the enterprise
31-12 zone in accordance with Section 20 of this Act.
31-13 Sec. 15. State and Local Regulatory Incentives. (a) State
31-14 agencies may exempt from their regulations qualified businesses,
31-15 qualified property, qualified employees, and neighborhood
31-16 enterprise associations in enterprise zones or to state designated
31-17 enterprise projects in the jurisdiction of an enterprise zone
31-18 governing body, if the exemptions are consistent with the purposes
31-19 of this Act and with the protection and promotion of the general
31-20 health and welfare. This power does not apply to:
31-21 (1) a regulation relating to:
31-22 (A) civil rights;
31-23 (B) equal employment;
31-24 (C) equal opportunity;
31-25 (D) fair housing rights; or
32-1 (E) preservation or protection of historical
32-2 sites or historical artifacts;
32-3 (2) a regulation the relaxation of which is likely to
32-4 harm the public safety or public health, including environmental
32-5 health; or
32-6 (3) a regulation specifically imposed by law.
32-7 (b) Regardless of a statute of limitations to the contrary,
32-8 a contractor or architect who constructs or rehabilitates a
32-9 building in an enterprise zone is liable for any structural defects
32-10 in the building for a period of 10 years after the day beneficial
32-11 occupancy of the building begins following the construction or the
32-12 rehabilitation.
32-13 (c) Within an enterprise zone designated by the department,
32-14 a local government may suspend local ordinances, rules,
32-15 regulations, or standards relating to zoning, licensing, or
32-16 building codes unless the ordinance, rule, regulation, or standard
32-17 relates to one of the proscribed topics in Subsection (a) of this
32-18 section.
32-19 (d) The suspension of or exemption from a rule, regulation,
32-20 standard, or local ordinance under this section must be adopted in
32-21 the same manner that the rule, regulation, standard, or ordinance
32-22 was adopted.
32-23 (e) Each state agency rule adopted after September 1, 1993
32-24 <1987>, when applicable, must <may> provide encouragements and
32-25 incentives to increase rehabilitation, renovation, restoration,
33-1 improvement, or new construction of housing and to increase the
33-2 economic viability and profitability of business and commerce in
33-3 enterprise zones. In addition, each state agency annually shall
33-4 review the rules it administers that may negatively impact the
33-5 rehabilitation, renovation, restoration, improvement, or new
33-6 construction of housing or the economic viability and profitability
33-7 of business and commerce in enterprise zones, or that may otherwise
33-8 affect the implementation of this Act, and shall report the results
33-9 of each review to the department. The department shall disseminate
33-10 the reports to enterprise zone governing bodies and others as
33-11 necessary to advance the purposes of this Act. An agency must
33-12 <may> take the necessary steps to waive, modify, create exemptions
33-13 to, or otherwise minimize the adverse effects of those rules on the
33-14 rehabilitation, renovation, restoration, improvement, or new
33-15 construction of housing or the economic viability and profitability
33-16 of business and commerce located in enterprise zones and contribute
33-17 to the implementation of this Act. An agency that receives funding
33-18 from the Enterprise Zone Special Needs Fund for providing programs
33-19 and services to enterprise zone applicants may utilize no more than
33-20 two percent of the Enterprise Zone Special Needs Fund which it
33-21 administers for administration purposes.
33-22 Sec. 16. Waiver of Performance Bond by Public Works
33-23 Contractor. A prime contractor is not required to execute a
33-24 performance bond under Article 5160, Revised Statutes, if:
33-25 (1) the construction, alteration, repair, or other
34-1 public work to be performed under the contract is entirely in an
34-2 enterprise zone; and
34-3 (2) the amount of the contract does not exceed
34-4 $200,000.
34-5 Sec. 17. Tax Refunds. An enterprise project is entitled to
34-6 refunds of certain state taxes as provided by Section 151.429, Tax
34-7 Code, and the deduction provided by Section 171.1015, Tax Code. A
34-8 qualified business is entitled to refunds of certain state taxes
34-9 under Sections 151.431 and 171.501, Tax Code.
34-10 Sec. 18. State Preferences. (a) A governing body of an
34-11 enterprise zone or a qualified business or qualified employee
34-12 located in an enterprise zone shall be given preference over other
34-13 eligible applicants for grants or loans that are administered by a
34-14 state agency, if:
34-15 (1) at least 50 percent of the grant or loan will be
34-16 expended for the direct benefit of the enterprise zone; and
34-17 (2) the purpose of the loan or grant is to:
34-18 (A) promote economic development in the
34-19 community; or
34-20 (B) construct, improve, extend, repair, or
34-21 maintain public facilities within the community.
34-22 (b) The state treasurer is authorized and encouraged to
34-23 deposit state money in financial institutions located in or doing
34-24 business in enterprise zones.
34-25 (c) State agencies are authorized and encouraged to contract
35-1 with businesses located in enterprise zones or designated as
35-2 enterprise projects in a jurisdiction that includes an enterprise
35-3 zone.
35-4 (d) The department may give preferences to a jurisdiction
35-5 that includes an enterprise zone<s> in the granting of any economic
35-6 development money or other benefit.
35-7 Sec. 19. Development Bonds. Bonds may be issued to finance
35-8 projects in enterprise zones as provided by the Act for Development
35-9 of Employment, Industrial and Health Resources of 1971 (Article
35-10 5190.1, Vernon's Texas Civil Statutes) and by the Development
35-11 Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
35-12 Statutes).
35-13 Sec. 20. Sale of Publicly Owned Real Property in Enterprise
35-14 Zone. (a) Once an area becomes an enterprise zone, the state and
35-15 a municipality or county or other taxing entity that owns any
35-16 surplus building or vacant land within the enterprise zone may
35-17 dispose of the surplus building or vacant land in one of the
35-18 following ways:
35-19 (1) sell or lease the surplus building or vacant land
35-20 at a public auction;
35-21 (2) sell or lease the vacant land to the neighborhood
35-22 enterprise association corporations, as established under this Act;
35-23 or
35-24 (3) establish an urban homestead program that
35-25 provides:
36-1 (A) that the state or the municipality or county
36-2 or applicable taxing entity will sell an individual a residence or
36-3 portion of a residence it owns for a sum not to exceed $100;
36-4 (B) that the individual agrees to live in the
36-5 residence for a period of at least seven years;
36-6 (C) that the individual agrees to renovate or
36-7 remodel the property to meet the level of maintenance stated in the
36-8 agreement between the individual and the state or the municipality
36-9 or county; or
36-10 (D) that the state or the municipality or county
36-11 shall assign the property to the individual at the end of the
36-12 seven-year residency requirement and after satisfactory
36-13 improvements to the property have been made.
36-14 (b) In addition to the methods of disposal provided in
36-15 Subsection (a), a municipality, <or> county or applicable taxing
36-16 entity may sell or lease a surplus building or vacant land in the
36-17 zone at less than fair market value if the governing body of the
36-18 municipality by ordinance or the governing body of the county by
36-19 order adopts criteria specifying the conditions and circumstances
36-20 under which the sale may occur and the public purpose that will be
36-21 achieved. The surplus building or vacant land may be sold or
36-22 leased to a for-profit or not-for-profit entity <buyer> who is not
36-23 the highest bidder if the criteria and public purpose specified in
36-24 the ordinance or order are satisfied. A copy of the ordinance or
36-25 order must be filed with the department not later than the day the
37-1 sale occurs.
37-2 Sec. 21. Neighborhood Enterprise Associations.
37-3 (a) Individuals residing in an enterprise zone may establish,
37-4 under this section, a neighborhood enterprise association. There
37-5 may be only one neighborhood enterprise association for any
37-6 geographic neighborhood area.
37-7 (b) The association must have a membership composed of
37-8 residents of the enterprise zone. The association must be a
37-9 nonprofit corporation organized under the Texas Non-Profit
37-10 Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
37-11 Statutes), and must be eligible for federal tax exemption status
37-12 under Section 501(c) of the Internal Revenue Code of 1986.
37-13 (c) The articles of incorporation must describe the
37-14 geographic neighborhood area to which the incorporating association
37-15 applies and authorize the association to engage in business only
37-16 within the particular enterprise zone in which the neighborhood
37-17 area of the association is located.
37-18 (d) The incorporators shall publish in a newspaper of
37-19 general circulation in the municipality or county an explanation of
37-20 the proposed new association and their rights in it. A copy of the
37-21 association's articles of incorporation and bylaws shall be made
37-22 available for public inspection at the office of the city manager
37-23 or comparable municipal officer or at the county judge's office, as
37-24 applicable.
37-25 (e) Each voting age individual who has been a resident of
38-1 the association's neighborhood area for at least one year is
38-2 entitled to be a member of the association with voting rights.
38-3 Other voting age residents of the area are entitled to be members
38-4 of the association but are not entitled to vote.
38-5 (f) Following the organization of the association, its board
38-6 of directors must apply to the governing body or the department for
38-7 certification as a neighborhood enterprise association.
38-8 (g) The governing body or the department may not grant its
38-9 approval unless the association has hired or appointed a suitable
38-10 chief executive officer.
38-11 (i) A neighborhood enterprise association may provide the
38-12 following public services with the approval of and in coordination
38-13 with the existing responsible state or local governmental entities:
38-14 (1) establishment of crime watch patrols within the
38-15 neighborhood area;
38-16 (2) establishment of volunteer day-care centers;
38-17 (3) organization of recreational activities for
38-18 neighborhood area youth;
38-19 (4) garbage collection;
38-20 (5) street maintenance and improvements;
38-21 (6) bridge maintenance and improvements;
38-22 (7) maintenance and improvements of water and sewer
38-23 lines;
38-24 (8) energy conservation projects;
38-25 (9) health and clinic services;
39-1 (10) drug abuse programs;
39-2 (11) senior citizen assistance programs;
39-3 (12) park maintenance;
39-4 (13) rehabilitation, renovation, and operation and
39-5 maintenance of low and moderate income housing; and
39-6 (14) other types of public services as provided by law
39-7 or regulation.
39-8 (j) These services may be provided by the association or,
39-9 after agreement with the relevant state or local governmental
39-10 entity, by private firms and organizations when feasible and
39-11 prudent. An existing responsible unit of government may contract
39-12 with a neighborhood enterprise association to provide services in
39-13 an amount corresponding to the amount of money saved by the unit of
39-14 government through this method of providing a service.
39-15 (k) The association may carry out other projects or types of
39-16 projects as approved by the governing body. In other cases, an
39-17 application must be submitted by the association to the governing
39-18 body that describes the nature and benefit of the project,
39-19 specifically:
39-20 (1) how it will contribute to the self-help efforts of
39-21 the residents of the area involved;
39-22 (2) how it will involve the residents of the area in
39-23 project planning and implementation;
39-24 (3) whether there are sufficient resources to complete
39-25 the project and whether the association will be fiscally
40-1 responsible for the project; and
40-2 (4) how it will enhance the enterprise zone in one of
40-3 the following ways:
40-4 (A) by creating permanent jobs;
40-5 (B) by physically improving the housing stock;
40-6 (C) by stimulating neighborhood business
40-7 activity; or
40-8 (D) by preventing crime.
40-9 (l) If the governing body does not specifically disapprove
40-10 of the project before the 45th day after the day of the receipt of
40-11 the application, it shall be considered approved. If the governing
40-12 body disapproves of the application, it shall specify its reasons
40-13 for this decision and allow 60 days for the applicant to make
40-14 amendments.
40-15 (m) The neighborhood enterprise association shall furnish an
40-16 annual statement to the governing body on the programmatic and
40-17 financial status of any approved project and an audited financial
40-18 statement of the project.
40-19 (n) The association may purchase or lease publicly owned or
40-20 privately owned real property.
40-21 (o) The association has other powers as established by law
40-22 or regulation, as well as all powers available to similar
40-23 corporations under state law.
40-24 (p) All real property within the neighborhood area of the
40-25 association that is owned by state or local government and which is
41-1 not in current use by the government may be leased to the
41-2 association. The term of the lease may not be less than 20 years
41-3 and the full amount of rental fees under the lease shall not exceed
41-4 $1 a year. The lease must be renewed upon expiration if the
41-5 association has continuously complied with the requirements of this
41-6 section during the terms of the lease.
41-7 (q) The association is exempt from any state or local taxes
41-8 during the life of the enterprise zone in which it is located. The
41-9 exemption also applies to any tax arrearages or other back
41-10 assessments on any property leased to the association under
41-11 Subsection (p) of this section.
41-12 Sec. 22. Zone Administration. (a) The administration of an
41-13 enterprise zone is under the jurisdiction of the appropriate unit
41-14 of local government, either a municipality or county, or any
41-15 combination of these local governments, consistent with its
41-16 function as specified in the state constitution. The governing
41-17 body may delegate its administrative duties to an administrative
41-18 authority. The administrative authority, if any, must be composed
41-19 of 3, 5, 7, 9, 11 or 15 members, must be a viable and responsive
41-20 body generally representative of all public or private entities
41-21 having a stake in the development of the zone, and must include
41-22 enterprise zone residents and representatives of the governing body
41-23 and, local businesses.
41-24 (b) The functions and duties of an administrative authority
41-25 must be specified in the agreement negotiated by the governing body
42-1 and the department, or in amendments to the negotiated agreement.
42-2 Those functions and duties should include decision-making authority
42-3 and the authority to negotiate with affected entities.
42-4 (c) Neighborhood enterprise associations should be active
42-5 participants in the administration of enterprise zones and should
42-6 be encouraged to participate in the planning and execution of
42-7 activities in enterprise zones.
42-8 (d) The governing body shall designate a liaison to
42-9 communicate and negotiate with the department, the administrative
42-10 authority, an enterprise project, and other entities in or affected
42-11 by an enterprise zone.
42-12 Sec. 23. Annual Reports on Enterprise Zones. Each
42-13 municipality, county, or combination of municipalities or counties
42-14 that authorized the creation of an enterprise zone shall submit an
42-15 annual report to the department, in such form as the department may
42-16 require, on or before October 1 of each year. The local
42-17 administrative authority, if any, for the zone must approve the
42-18 report. The report must include:
42-19 (1) a list of local incentives for community
42-20 redevelopment available in the zone during the prior year;
42-21 (2) the use and revenue impact of the local incentives
42-22 that the governing body committed to provide in the zone in the
42-23 resolution designating the zone;
42-24 (3) the number of business establishments located in
42-25 the zone during the prior year, <and> the number of business
43-1 establishments located in the zone in the year prior to the
43-2 approval of the area as an enterprise zone and the number and names
43-3 of businesses to whom the applicable enterprise zone governing
43-4 body(ies) has provided local or state incentives relative to the
43-5 enterprise zone;
43-6 (4) a copy of the report required pursuant to Section
43-7 103, Internal Revenue Code of 1986, for all industrial revenue
43-8 bonds issued to finance projects located in the zone during the
43-9 prior year; and
43-10 (5) a report on the attainment of revitalization goals
43-11 for the zone.
43-12 Sec. 24. Coordination of Enterprise Zone Programs With Other
43-13 Programs of the Federal and State Government. (a) The department
43-14 shall work together with the responsible federal and state agencies
43-15 to promote the coordination of other relevant programs, including
43-16 housing, community and economic development, small business,
43-17 banking, financial assistance, transportation, energy conservation,
43-18 environmental protection including recycling, and employment
43-19 training programs that are carried out within an enterprise zone.
43-20 It shall further work to expedite, to the greatest extent possible,
43-21 the consideration of applications for the programs through the
43-22 consolidation of forms or otherwise and shall work, whenever
43-23 possible, for the consolidation of periodic reports required under
43-24 the programs into one summary report.
43-25 (b) The department shall <encourage> coordinate with other
44-1 state agencies' efforts to give priority to businesses in
44-2 enterprise zones for the receipt of grants, loans, or services.
44-3 Sec. 25. Industrial Development Corporation for Enterprise
44-4 Zone Use. (a) The governing body of a municipality that nominated
44-5 an enterprise zone designated by the department may create an
44-6 industrial development corporation under the Development
44-7 Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
44-8 Statutes) for use by the enterprise zone. The corporation has the
44-9 powers and is subject to the limitations of a corporation created
44-10 under the Development Corporation Act. To the extent of a conflict
44-11 between this section and the Development Corporation Act, the act
44-12 prevails. The articles of incorporation of a corporation created
44-13 under this section must state that the corporation is governed by
44-14 this section.
44-15 (b) The governing body of the municipality that creates the
44-16 industrial development corporation shall appoint the board of
44-17 directors of the corporation.
44-18 SECTION 2. The importance of this legislation and the
44-19 crowded condition for the calendars in both houses create an
44-20 emergency and an imperative public necessity that the
44-21 constitutional rule requiring bills to be read on three several
44-22 days in each house be suspended, and this rule is hereby suspended,
44-23 and that this Act take effect and be in force from and after its
44-24 passage, and it is so enacted.