By Lucio                                               S.B. No. 458
       74R3465 CBH-F
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to an exemption from the gas production tax for certain
    1-3  high-cost gas.
    1-5        SECTION 1.  Sections 201.057(b) and (d), Tax Code, are
    1-6  amended to read as follows:
    1-7        (b)  High-cost gas as defined in Subsection (a)(2)(A) of this
    1-8  section produced from a well that is spudded or completed between
    1-9  May 24, 1989, and September 1, 1996, is exempt from the tax imposed
   1-10  by this chapter during the period beginning September 1, 1991, and
   1-11  ending August 31, 2001.  High-cost gas as defined in Subsection
   1-12  (a)(2)(A) of this section produced from a well that is spudded or
   1-13  completed after September 1, 1996, but before August 31, 2002, is
   1-14  exempt from the tax imposed by this chapter during the period
   1-15  beginning September 1, 1996, and ending August 31, 2007.  High-cost
   1-16  gas as defined in Subsection (a)(2)(B) of this section produced
   1-17  from any well regardless of spud date or completion date is
   1-18  eligible for refunds of tax paid and exemption from the tax imposed
   1-19  by this chapter for production occurring during the period
   1-20  beginning the first day of the month after commission approval of a
   1-21  co-production project and ending  August 31, 2001; provided,
   1-22  however, in the event  co-production ceases, the exemption shall
   1-23  also cease on the first day of the first calendar month that begins
   1-24  on or after the 91st day following the date of termination of
    2-1  co-production operations.  Tax must be paid when due at the rate
    2-2  provided in Section 201.052 of this code for  all high-cost gas, as
    2-3  defined in Subsection (a)(2)(B) of this section, produced on or
    2-4  before July 31, 1995.  On or after September 1, 1995, the operator
    2-5  may apply to the comptroller for a refund and shall be entitled to
    2-6  receive a refund of  all taxes paid on such high-cost gas produced
    2-7  on or after the first day of the calendar month after commission
    2-8  approval of the co-production project from which such gas was
    2-9  produced and that is otherwise eligible for the tax exemption.
   2-10        (d)  To qualify for the exemption provided by this section,
   2-11  the person responsible for paying the tax must  apply to the
   2-12  comptroller.  The  application must contain the certification of
   2-13  the commission that the well produces high-cost gas.  An
   2-14  application may not be filed  before January 1, 1990, or  after
   2-15  December 31, 2004 <1998>.  The comptroller shall approve the
   2-16  application of a person who demonstrates that the gas is eligible
   2-17  for the exemption.  The comptroller may require a person applying
   2-18  for  the exemption to provide any relevant information in the
   2-19  person's monthly report that the comptroller considers necessary to
   2-20  administer this section.  The commission shall notify the
   2-21  comptroller in writing immediately if it determines that an oil or
   2-22  gas well previously certified as producing high-cost gas does not
   2-23  produce high-cost gas or if it takes any action or discovers any
   2-24  information that affects the eligibility of gas for an exemption
   2-25  under this section.
   2-26        SECTION 2.  This Act takes effect September 1, 1995.
   2-27        SECTION 3.  The importance of this legislation and the
    3-1  crowded condition of the calendars in both houses create an
    3-2  emergency and an imperative public necessity that the
    3-3  constitutional rule requiring bills to be read on three several
    3-4  days in each house be suspended, and this rule is hereby suspended.