S.B. No. 893
                                        AN ACT
    1-1  relating to technical changes to statutes involving certain tax
    1-2  provisions including those administered by the comptroller, to the
    1-3  definitions of certain items taxed under the sales tax and
    1-4  controlled substance tax laws, to limitations on certain municipal
    1-5  tax rates, to the duties of the appraisal review board, and to
    1-6  delinquent taxes and tax liens; revising references in the
    1-7  inheritance tax statute to federal tax code provisions concerning
    1-8  credits.
    1-9        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-10        SECTION 1.  Subsection (e), Section 1.111, Tax Code, is
   1-11  amended to read as follows:
   1-12        (e)  An agreement between <an agent for> a property owner or
   1-13  the owner's agent and the chief appraiser <relating to a matter
   1-14  that may be protested to the appraisal review board> is <not> final
   1-15  if the agreement relates to a matter:
   1-16              (1)  which may be protested to the appraisal review
   1-17  board or on which a protest has been filed but not determined
   1-18  <unless approved> by the <appraisal review> board; or
   1-19              (2)  which may be corrected under Section 25.25 or on
   1-20  which a motion for correction under that section has been filed but
   1-21  not determined by the board.
   1-22        SECTION 2.  Section 25.25, Tax Code, is amended by adding
   1-23  Subsections (h) through (j) to read as follows:
    2-1        (h)  The appraisal review board, on the joint motion of the
    2-2  property owner and the chief appraiser filed at any time prior to
    2-3  the date the taxes become delinquent, shall by written order
    2-4  correct an error that resulted in an incorrect appraised value for
    2-5  the owner's property.
    2-6        (i)  A person who acquires property after January 1 of the
    2-7  tax year at issue is entitled to file any motion that this section
    2-8  authorizes the person who owned the property on January 1 of that
    2-9  year to file, if the deadline for filing the motion has not passed.
   2-10        (j)  If during the pendency of a motion under this section
   2-11  the ownership of property subject to the motion changes, the new
   2-12  owner of the property is entitled to proceed with the motion in the
   2-13  same manner as the property owner who filed the motion.
   2-14        SECTION 3.  Section 32.01, Tax Code, is amended to read as
   2-15  follows:
   2-16        Sec. 32.01.  Tax Lien.  (a)  On January 1 of each year, a tax
   2-17  lien attaches to property to secure the payment of all taxes,
   2-18  penalties, and interest ultimately imposed for the year on the
   2-19  <that> property, whether or not the taxes are imposed in the year
   2-20  the lien attaches.  The lien exists in favor of each taxing unit
   2-21  having power to tax the property.
   2-22        (b)  A tax lien on inventory, furniture, equipment, or other
   2-23  personal property is a lien in solido and attaches to all
   2-24  inventory, furniture, equipment, and other personal property that
   2-25  the property owner owns on January 1 of the year the lien attaches
    3-1  or that the property owner subsequently acquires.
    3-2        (c)  The lien under this section is perfected on attachment
    3-3  and, except as provided by Section 32.03(b), perfection requires no
    3-4  further action by the taxing unit.
    3-5        SECTION 4.  Section 33.41, Tax Code, is amended by adding
    3-6  Subsection (c) to read as follows:
    3-7        (c)  In a suit brought under Subsection (a), a taxing unit
    3-8  may foreclose any other lien on the property in favor of the taxing
    3-9  unit or enforce personal liability of the property owner for the
   3-10  other lien.
   3-11        SECTION 5.  Section 41.01, Tax Code, is amended to read as
   3-12  follows:
   3-13        Sec. 41.01.  DUTIES <SCOPE> OF APPRAISAL REVIEW BOARD.  The
   3-14  appraisal review board shall <examine the appraisal records for the
   3-15  appraisal district to determine whether>:
   3-16              (1)  determine protests initiated by property owners
   3-17  <appraisals are substantially uniform in terms of their
   3-18  relationship to the appraised value required by law>;
   3-19              (2)  determine challenges initiated by taxing units <an
   3-20  exemption or a partial exemption is improperly granted>;
   3-21              (3)  correct clerical errors in the appraisal records
   3-22  and the appraisal rolls <land is improperly granted appraisal as
   3-23  provided by Subchapter C, D, or E, Chapter 23 of this code>; <or>
   3-24              (4)  act on motions to correct appraisal rolls under
   3-25  Section 25.25;
    4-1              (5)  determine whether an exemption or a partial
    4-2  exemption is improperly granted and whether land is improperly
    4-3  granted appraisal as provided by Subchapter C, D, or E, Chapter 23;
    4-4  and
    4-5              (6)  take any other action or make any other
    4-6  determination that this title specifically authorizes or requires
    4-7  <the records do not conform to the requirements of law in any other
    4-8  respect>.
    4-9        SECTION 6.  Section 41.02, Tax Code, is amended to read as
   4-10  follows:
   4-11        Sec. 41.02.  Action by Board.  After making a determination
   4-12  or decision under Section 41.01,  <If after reviewing the appraisal
   4-13  records> the appraisal review board <finds that appraisals are not
   4-14  substantially uniform or that the records do not conform to the
   4-15  requirements of law in some other respect, the board> shall <refer
   4-16  the matter to the appraisal office and> by written order <shall>
   4-17  direct the chief appraiser to correct or change the appraisal <make
   4-18  the reappraisals or corrections in the> records or the appraisal
   4-19  roll <that are necessary> to conform the appraisal records or the
   4-20  appraisal roll to the board's determination or decision
   4-21  <requirements of law>.
   4-22        SECTION 7.  The heading of Section 41.12, Tax Code, is
   4-23  amended to read as follows:
   4-24        Sec. 41.12.  APPROVAL <COMPLETION> OF APPRAISAL RECORDS
   4-25  <REVIEW> BY BOARD.
    5-1        SECTION 8.  Subsection (a), Section 41.12, Tax Code, is
    5-2  amended to read as follows:
    5-3        (a)  By July 20, the <The> appraisal review board shall:
    5-4              (1)  hear and determine all or substantially all timely
    5-5  filed protests;
    5-6              (2)  determine all timely filed challenges;
    5-7              (3)  <complete its review of the appraisal records,
    5-8  approve the records, and> submit a list of its approved changes in
    5-9  the records to the chief appraiser; and
   5-10              (4)  approve the records <by July 20>.
   5-11        SECTION 9.  Section 42.225, Tax Code, is amended to read as
   5-12  follows:
   5-13        Sec. 42.225.  Property Owner's Right to Appeal Through
   5-14  <Binding> Arbitration.  (a)  On motion by a  <A> property owner who
   5-15  appeals an appraisal review board order under this chapter, the
   5-16  court shall submit the appeal to nonbinding <is entitled to have
   5-17  the appeal resolved through binding> arbitration.  The court shall
   5-18  order the nonbinding arbitration to be conducted in accordance with
   5-19  Chapter 154, Civil Practice and Remedies Code.  If the appeal
   5-20  proceeds to trial following an arbitration award or finding under
   5-21  this subsection, either party may introduce the award or finding
   5-22  into evidence.  In addition, the court shall award the property
   5-23  owner reasonable attorney fees if the trial was not requested by
   5-24  the property owner and the determination of the appeal results in
   5-25  an appraised value for the owner's property that is equal to or
    6-1  less than the appraised value under the arbitration award or
    6-2  finding.  However, the amount of an award of attorney fees under
    6-3  this subsection is subject to the same limitations as those
    6-4  provided by Section 42.29.
    6-5        (b)  On motion by the property owner, the court shall order
    6-6  the parties to an appeal of an appraisal review board order under
    6-7  this chapter to submit to binding arbitration if the appraisal
    6-8  district joins in the motion or consents to the arbitration.  A
    6-9  binding arbitration award under this subsection is binding and
   6-10  enforceable in the same manner as a contract obligation <and shall
   6-11  appoint an impartial third party to conduct the arbitration.  The
   6-12  impartial third party is appointed by the court and serves as
   6-13  provided by Subchapter C, Chapter 154, Civil Practice and Remedies
   6-14  Code>.
   6-15        (c)  The court shall appoint an impartial third party to
   6-16  conduct an arbitration under this section.  The impartial third
   6-17  party is appointed by the court and serves as provided by
   6-18  Subchapter C, Chapter 154, Civil Practice and Remedies Code.
   6-19        (d)  Each party or counsel for the party may present the
   6-20  position of the party before the impartial third party, who must
   6-21  render a specific arbitration award <resolving the appeal>.
   6-22        <(d)  Except as provided by Subsection (e), an arbitration
   6-23  award is binding and enforceable in the same manner as a contract
   6-24  obligation if:>
   6-25              <(1)  in a motion filed under Subsection (b), the
    7-1  property owner stipulates that the award is to be binding on all
    7-2  the parties; or>
    7-3              <(2)  before the rendition of the award, the parties
    7-4  agree to be bound.>
    7-5        (e)  Prior to submission of a case to arbitration the court
    7-6  shall determine matters related to jurisdiction, venue, and
    7-7  interpretation of the law.  <An arbitration award is not binding if
    7-8  it results or would result in an amount of taxes on the property
    7-9  that exceeds the amount of taxes assessed on the property under the
   7-10  order from which the appeal is taken.>
   7-11        (f)  Except as provided in this section, an  <An> arbitration
   7-12  award may include any remedy or relief that a court could order
   7-13  under this chapter.
   7-14        SECTION 10.  Subdivision (3), Subsection (f), Section 11,
   7-15  Chapter 683, Acts of the 66th Legislature, 1979 (Article 1118y,
   7-16  Vernon's Texas Civil Statutes), is amended to read as follows:
   7-17              (3)  If an authority created by a principal city having
   7-18  a population of more than 800,000 adds territory that is a city or
   7-19  town that imposes an additional sales and use tax under Chapter
   7-20  321, Tax Code, the additional sales and use tax is repealed as
   7-21  provided by Section 321.1025, Tax Code.  The effective date for the
   7-22  repeal and for the imposition of the tax authorized to be collected
   7-23  under Section 16 of this Act in the added territory is the date
   7-24  that, under Section 321.102(b) <321.102(a)>, Tax Code, the repeal
   7-25  of the additional sales and use tax is effective in the territory.
    8-1        SECTION 11.  Subsection (p), Section 4A, Development
    8-2  Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
    8-3  Statutes), is amended to read as follows:
    8-4        (p)  A city that is authorized by this section to impose,
    8-5  reduce, increase, or abolish the tax under this section may, at the
    8-6  same time and on the same ballot, impose, reduce, increase, or
    8-7  abolish the additional sales and use tax imposed under Section
    8-8  321.101(b), Tax Code, if the city is authorized by Chapter 321, Tax
    8-9  Code, to impose, reduce, increase, or abolish the additional sales
   8-10  and use tax.  <The combined rate of the tax under this section and
   8-11  the additional sales and use tax imposed under Section 321.101(b),
   8-12  Tax Code, may not exceed one-half of one percent.  An election
   8-13  adopting a combined rate of the tax under this section and the
   8-14  additional sales and use tax that exceeds one-half of one percent
   8-15  has no effect.>  The city must follow, in relation to the
   8-16  imposition, reduction, increase, or abolishment of the additional
   8-17  sales and use tax imposed under Section 321.101(b), Tax Code, the
   8-18  procedures of that chapter, except that in an election to impose,
   8-19  reduce, increase, or abolish the tax under this section and the
   8-20  additional sales and use tax the ballot shall be printed to provide
   8-21  for voting for or against the proposition:  "The adoption of a
   8-22  sales and use tax within the city for the promotion and development
   8-23  of new and expanded business enterprises at the rate of ________ of
   8-24  one percent (one-eighth, one-fourth, three-eighths, or one-half to
   8-25  be inserted as appropriate) and the adoption of an additional sales
    9-1  and use tax within the city at the rate of ________ of one percent
    9-2  to be used to reduce the property tax rate" (one-eighth,
    9-3  one-fourth, three-eighths, or one-half to be inserted as
    9-4  appropriate).
    9-5        SECTION 12.  Subsection (e), Section 4B, Development
    9-6  Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
    9-7  Statutes), is amended to read as follows:
    9-8        (e)  If an eligible city adopts the tax, a tax is imposed on
    9-9  the receipts from the sale at retail of taxable items within the
   9-10  eligible city at a rate approved by the governing body of the
   9-11  eligible city.  The rate must be equal to one-eighth, one-fourth,
   9-12  three-eighths, or one-half of one percent.  There is also imposed
   9-13  an excise tax on the use, storage, or other consumption within the
   9-14  eligible city of tangible personal property purchased, leased, or
   9-15  rented from a retailer during the period that the tax is effective
   9-16  within the eligible city.  The rate of the excise tax is the same
   9-17  as the rate of the sales tax portion of the tax and is applied to
   9-18  the sale price of the tangible personal property.
   9-19        SECTION 13.  Subsections (b) and (c), Section 21.22, Tax
   9-20  Code, are amended to read as follows:
   9-21        (b)  The comptroller <board>, in prescribing the contents of
   9-22  the form, shall ensure that the form requires the person to furnish
   9-23  the information necessary to identify the mobile home and determine
   9-24  its ownership, to name the person for whom the mobile home was
   9-25  moved, and to state the address of the place from which and the
   10-1  place to which the mobile home was moved.
   10-2        (c)  A person required to make a record of the movement of a
   10-3  mobile home shall keep the record for the period of time prescribed
   10-4  by the comptroller <board>.  He shall keep the record at his
   10-5  principal place of business if he has one, and if he does not have
   10-6  one, he shall keep the record at his principal residence.
   10-7        SECTION 14.  Subsection (j), Section 23.54, Tax Code, is
   10-8  amended to read as follows:
   10-9        (j)  If the chief appraiser discovers that appraisal under
  10-10  this subchapter has been erroneously allowed in any one of the five
  10-11  <10> preceding years because of failure of the person whose land
  10-12  was allowed appraisal under this subchapter to give notice that its
  10-13  eligibility has ended, he shall add the difference between the
  10-14  appraised value of the land under this subchapter and the market
  10-15  value of the land to the appraisal roll as provided by Section
  10-16  25.21 of this code for other property that escapes taxation.
  10-17        SECTION 15.  Subsection (d), Section 24.02, Tax Code, is
  10-18  amended to read as follows:
  10-19        (d)  Reports must be filed before March 1.  For good cause
  10-20  shown the comptroller <board> may extend the filing deadline <by
  10-21  written order> for a single period not to exceed 60 days.
  10-22        SECTION 16.  Subsection (a), Section 33.48, Tax Code, is
  10-23  amended to read as follows:
  10-24        (a)  In addition to other costs authorized by law, a taxing
  10-25  unit is entitled to recover the following costs and expenses in a
   11-1  suit to collect a delinquent tax:
   11-2              (1)  all usual court costs, including the cost of
   11-3  serving process;
   11-4              (2)  costs of filing for record a notice of lis pendens
   11-5  against property;
   11-6              (3)  expenses of foreclosure sale;
   11-7              (4) <(3)>  reasonable expenses, subject to approval by
   11-8  the court, that are incurred by the taxing unit in determining the
   11-9  name, identity, and location of necessary parties and in procuring
  11-10  necessary legal descriptions of the property on which a delinquent
  11-11  tax is due; and
  11-12              (5) <(4)>  reasonable attorney's fees approved by the
  11-13  court and not exceeding 15 percent of the total amount of taxes,
  11-14  penalties, and interest <adjudged> due the unit.
  11-15        SECTION 17.  Subsection (a), Section 41.461, Tax Code, is
  11-16  amended to read as follows:
  11-17        (a)  At least 14 days before a hearing on a protest, the
  11-18  chief appraiser shall:
  11-19              (1)  deliver a copy of the pamphlet prepared by the
  11-20  comptroller <State Property Tax Board> under Section 5.06(a) to the
  11-21  property owner initiating the protest if the owner is representing
  11-22  himself, or to an agent representing the owner if requested by the
  11-23  agent;
  11-24              (2)  inform the property owner that the owner or the
  11-25  agent of the owner may inspect and may obtain a copy of the data,
   12-1  schedules, formulas, and all other information the chief appraiser
   12-2  plans to introduce at the hearing to establish any matter at issue;
   12-3  and
   12-4              (3)  deliver a copy of the hearing procedures
   12-5  established by the appraisal review board under Section 41.66 to
   12-6  the property owner.
   12-7        SECTION 18.  Section 101.007, Tax Code, is amended to read as
   12-8  follows:
   12-9        Sec. 101.007.  References to State Officers.  A reference in
  12-10  this code <title> to the comptroller, the treasurer, or another
  12-11  officer includes authorized representatives and employees of the
  12-12  officer unless the provision indicates that only the officer is
  12-13  intended in the reference.
  12-14        SECTION 19.  Section 151.0048, Tax Code, is amended to read
  12-15  as follows:
  12-16        Sec. 151.0048.  <">REAL PROPERTY SERVICE.<">  "Real property
  12-17  service" means:
  12-18              (1)  landscaping;
  12-19              (2)  the care and maintenance of lawns, yards, or
  12-20  ornamental trees or other plants;
  12-21              (3)  the removal or collection of garbage, rubbish, or
  12-22  other solid waste other than:
  12-23                    (A)  hazardous waste;
  12-24                    (B)  industrial solid waste;
  12-25                    (C)  waste material that results from an activity
   13-1  associated with the exploration, development, or production of oil,
   13-2  gas, geothermal resources, or any other substance or material
   13-3  regulated by the Railroad Commission of Texas under Section 91.101,
   13-4  Natural Resources Code; <and>
   13-5                    (D)  domestic sewage or an irrigation return
   13-6  flow, to the extent the sewage or return flow does not constitute
   13-7  garbage or rubbish; and
   13-8                    (E)  industrial discharges subject to regulation
   13-9  by permit issued pursuant to Chapter 26, Water Code;
  13-10              (4)  building or grounds cleaning, janitorial, or
  13-11  custodial services;
  13-12              (5)  a structural pest control service covered by
  13-13  Section 2, Texas Structural Pest Control Act (Article 135b-6,
  13-14  Vernon's Texas Civil Statutes); or
  13-15              (6)  the surveying of real property.
  13-16        SECTION 20.  Section 151.058, Tax Code, is amended to read as
  13-17  follows:
  13-18        Sec. 151.058.  PROPERTY USED TO PROVIDE TAXABLE SERVICES AND
  13-19  SALE PRICE OF TAXABLE <REPAIR> SERVICES.  (a)  A person performing
  13-20  <repair> services taxable under this chapter is the consumer of
  13-21  machinery and equipment used in performing the services <service>.
  13-22        (b)  The total amount charged for a <repair> service taxable
  13-23  under this chapter is subject to tax, including charges for labor,
  13-24  materials, overhead, and profit, regardless of whether such charges
  13-25  are separately identified to the purchaser of the service.
   14-1        SECTION 21.  Subsection (a), Section 151.104, Tax Code, is
   14-2  amended to read as follows:
   14-3        (a)  A sale of a taxable item <tangible personal property> by
   14-4  a person for delivery in this state is presumed to be a sale for
   14-5  storage, use, or consumption in this state unless a resale or
   14-6  exemption certificate is accepted by the seller.
   14-7        SECTION 22.  Subsection (b), Section 151.320, Tax Code, is
   14-8  amended to read as follows:
   14-9        (b)  "Magazine" means a publication that is usually
  14-10  paperbacked and sometimes illustrated, that appears at a regular
  14-11  interval, and that contains stories, articles, and essays by
  14-12  various writers and advertisements.  "Magazine" does not mean the
  14-13  publication of current information which is taxable pursuant to
  14-14  Section 151.0038 of this code as an "information service."
  14-15        SECTION 23.  Section 159.001, Tax Code, is amended to read as
  14-16  follows:
  14-17        Sec. 159.001.  Definitions.  In this chapter:
  14-18              (1)  "Controlled substance" has the meaning assigned by
  14-19  Section 481.002, Health and Safety Code.
  14-20              (2)  "Counterfeit substance" has the meaning assigned
  14-21  by Section 481.002, Health and Safety Code.
  14-22              (3)  "Dealer" means a person who in violation of the
  14-23  law of this state imports into this state or manufactures,
  14-24  produces, acquires, or possesses in this state:
  14-25                    (A)  seven grams or more of a taxable substance
   15-1  consisting of or containing a controlled substance, counterfeit
   15-2  substance, or simulated controlled substance; <or>
   15-3                    (B)  fifty dosage units or more of a taxable
   15-4  substance not commonly sold by weight, consisting of or containing
   15-5  a controlled substance, counterfeit substance, or simulated
   15-6  controlled substance; or
   15-7                    (C)  more than four ounces of a taxable substance
   15-8  consisting of or containing marihuana.
   15-9              (4)  "Marihuana" has the meaning assigned by Section
  15-10  481.002, Health and Safety Code.
  15-11              (5)  "Simulated controlled substance" has the meaning
  15-12  assigned by Section 482.001, Health and Safety Code.
  15-13              (6)  "Tax payment certificate" means a stamp or other
  15-14  device provided by the comptroller under Section 159.003 of this
  15-15  code for use under this chapter.
  15-16              (7)  "Taxable substance" means a controlled substance,
  15-17  a counterfeit substance, a simulated controlled substance, or
  15-18  marihuana, or a mixture of any materials that contains a controlled
  15-19  substance, counterfeit substance, simulated controlled substance,
  15-20  or marihuana.
  15-21              (8)  "Dosage unit" means a tablet, pill, capsule, vial,
  15-22  ampule, or other identifiable or separated unit designed or
  15-23  packaged to be used, taken, or ingested at one time.
  15-24        SECTION 24.  Subdivisions (8) and (9), Section 211.001, Tax
  15-25  Code, are amended to read as follows:
   16-1              (8)  "Generation-skipping transfer" means a transfer
   16-2  for which a credit for state taxes is allowable under Section 2604
   16-3  <2602(c)(5)(C)>, Internal Revenue Code.
   16-4              (9)  "Generation-skipping transfer tax credit" means
   16-5  the maximum amount of the credit for state death taxes allowable
   16-6  under Section 2604 <2602(c)(5)(C)>, Internal Revenue Code.
   16-7        SECTION 25.  Section 321.101, Tax Code, is amended by adding
   16-8  Subsection (g) to read as follows:
   16-9        (g)  For the purposes of Subsection (f), "territory" in a
  16-10  municipality having a population of 5,000 or less and bordering on
  16-11  the Gulf of Mexico does not include any area covered by water and
  16-12  in which no person has a place of business to which a sales tax
  16-13  permit issued under Subchapter F of Chapter 151 applies.
  16-14        SECTION 26.  This Act takes effect September 1, 1993.
  16-15        SECTION 27.  The importance of this legislation and the
  16-16  crowded condition of the calendars in both houses create an
  16-17  emergency and an imperative public necessity that the
  16-18  constitutional rule requiring bills to be read on three several
  16-19  days in each house be suspended, and this rule is hereby suspended.