BILL ANALYSIS



H.B. 1611
By: Stiles
March 15, 1995
Committee Report (Unamended)


BACKGROUND

Stevedoring firms are businesses providing ship owners with the
service of loading and securing cargo.  They provide the machinery
(cranes, forklifts, etc.) used to move the cargo, the manpower used
to operate the equipment and to secure the cargo, and the securing
material (ropes, cables, pallets, etc.).  The ship owner is charged
an agreed upon fee for providing the services and the cost of
providing the securing materials.

Section 151.329, Tax Code, provides for exemptions to the sales and
use tax for certain ships and ship equipment.  Currently, owners or
operators of a ship that is used exclusively in foreign or
interstate coastal commerce are exempt from paying sales and use
tax for materials and supplies that become a part of the ship; or
are loaded on the ship and used in its maintenance and operation. 
Stevedoring firms are not presently included in this exemption.

PURPOSE

This bill would exempt from the sales and use tax materials or
supplies provided in connection with stevedoring services to a
vessel in interstate or foreign commerce if the materials or
supplies are loaded upon the vessel and not removed before
departure. 

RULEMAKING AUTHORITY

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

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 151.329 (Certain Ships and Equipment),
Tax Code, by adding Subdivision (5) to provide a tax exemption for
materials and supplies used for stevedoring services for certain
ships if the materials and supplies are loaded on the ship and not
removed before departure.

SECTION 2. Provides an effective date for the Act; makes
application of the Act prospective.

SECTION 3. Emergency clause.


SUMMARY OF COMMITTEE ACTION

Public notice was posted in accordance to the rules and a public
hearing was held on March 14, 1995.  Representative Stiles
explained the bill.  By a record vote of 7 ayes, 0 nays, 0 present
not voting and 4 absent, the committee voted to report H.B. 1611 to
the House without amendment with the recommendation that it do
pass.


     Testimony received in favor of the bill:
           Edward A. Gilbert, representing the West Gulf Maritime
Assn.