BILL ANALYSIS


                                                         H.B. 399
                                             By: Uher (Patterson)
                                                          Finance
                                                         05-22-95
                              Senate Committee Report (Unamended)
BACKGROUND

Currently, many of the smaller commercial fishing operations are
family owned and operated, using only one boat that is typically
less than 100 feet in length and is taxed as real and tangible
personal property.  With the inconsistent nature of commercial
fishing, the taxes imposed on these boats and related equipment
cause a burden on the operation of these families' small business.

PURPOSE

As proposed, H.B. 399 authorizes a political subdivision to exempt
commercial fishing boats not exceeding 100 feet in length and
related equipment from ad valorem taxes.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 11B, Tax Code, by adding Section 11.162,
as follows:

     Sec.  11.162.  COMMERCIAL FISHING EQUIPMENT.  (a)  Authorizes
     the governing body of a taxing unit to exempt a person from
     taxation of each boat the person owns and uses primarily in
     the taking of fish, shrimp, shellfish, and other marine life
     for resale as food for human consumption. 
     
     (b)  Provides that the exemption provided by this section also
     applies to the nets and other equipment primarily used in
     connection with the use of the boat for the exempt purposes
     provided by Subsection (a).
     
     (c)  Defines "boat."
     
SECTION 2. Amends Section 11.43(c), Tax Code, to make a conforming
change.

SECTION 3. Effective date:  January 1, 1996, but only if the
constitutional amendment proposed by the 74th Legislature, Regular
Session, 1995, authorizing the governing body of a political
subdivision to exempt from ad valorem taxation boats and other
equipment used primarily in the commercial taking of fish, shrimp,
shellfish, and other marine life is approved by the voters. 
Provides that this Act has no effect if the proposed amendment is
not approved by the voters.

SECTION 4. Emergency clause.