BILL ANALYSIS C.S.H.B. 2860 By: Grusendorf (Barrientos) Finance 05-25-95 Senate Committee Report (Substituted) BACKGROUND Under the Property Redevelopment and Tax Abatement Act, municipalities, counties, and other taxing entities can enter into tax abatement agreements with property owners. Communities grant tax abatements to help stimulate economic growth in certain areas. Tax abatements help attract financial investment which, in turn, expands primary employment opportunities. Currently, the Property Redevelopment and Tax Abatement Act will expire September 1, 1995. PURPOSE As proposed, C.S.H.B. 2860 establishes an option to certain school districts to grant tax abatements. The bill also repeals the expiration provision of Chapter 312, Tax Code, and reenacts the language in the chapter without the sunset provision. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 312B, Tax Code, by adding Section 321.210, as follows: Sec. 312.210. AGREEMENT BY TAXING UNITS RELATING TO PROPERTY IN CERTAIN SCHOOL DISTRICTS. (a) Provides that this section applies to a tax abatement agreement applicable to property located in a reinvestment zone with respect to which a municipality, county, and junior college district have entered into a joint agreement to offer tax abatements exempting from taxation a specified portion of the value of the property in the reinvestment zone. (b) Requires a tax abatement agreement with the owner of real property that is located in the reinvestment zone described by Subsection (a) and in a school district that has a wealth per student that does not exceed the equalized wealth level to exempt certain portions of the value of property from taxation. (c) Defines "wealth per student" and "equalized wealth level." SECTION 2. Makes application of this Act prospective. SECTION 3. Emergency clause. Effective date: upon passage.