By: Armbrister S.B. No. 1234 A BILL TO BE ENTITLED AN ACT 1-1 relating to reimbursement of certain fees and taxes paid by a motor 1-2 vehicle rental company; providing a civil penalty. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Chapter 20, Title 132, Revised Statutes, is 1-5 amended by adding Article 9026a to read as follows: 1-6 Art. 9026a. MOTOR VEHICLE RENTAL REIMBURSEMENT CHARGES 1-7 Sec. 1. DEFINITIONS. In this article: 1-8 (1) "Gross rental receipts tax" means the tax imposed 1-9 by Section 152.026, Tax Code. 1-10 (2) "Motor vehicle" means a self-propelled vehicle 1-11 designed to transport persons or property on a public highway or a 1-12 trailer, semitrailer, or house trailer, as those terms are defined 1-13 by the Certificate of Title Act (Article 6687-1, Vernon's Texas 1-14 Civil Statutes). 1-15 (3) "Person" means an individual, firm, corporation, 1-16 or other legal entity. 1-17 (4) "Rental agreement" means a written agreement 1-18 stating the terms and conditions governing the use of a motor 1-19 vehicle provided by a rental company. 1-20 (5) "Rental company" means a person in the business of 1-21 renting motor vehicles. 1-22 (6) "Rental day" means any 24-hour period or any 1-23 portion of a 24-hour period during which a particular motor vehicle 1-24 was rented by a single renter for which the renter was charged any 2-1 amount of rent. 2-2 (7) "Renter" means a person that obtains use of a 2-3 motor vehicle from a rental company under the terms of a rental 2-4 agreement. 2-5 Sec. 2. APPLICATION. (a) This article applies only to the 2-6 rental of a motor vehicle in this state by a rental company 2-7 required to register under Section 152.065, Tax Code. 2-8 (b) This article does not apply to: 2-9 (1) rental of a vehicle for use in transporting 2-10 commercial freight; or 2-11 (2) a rental exempt from the gross rental receipts 2-12 tax. 2-13 Sec. 3. REIMBURSEMENT CHARGE. A rental company may include 2-14 in each rental agreement a charge to reimburse the rental company 2-15 for amounts the rental company paid during the calendar year 2-16 preceding the year of the agreement for title fees, registration 2-17 fees, and property taxes on the rental company's motor vehicle 2-18 rental fleet. The rental company may retain amounts collected 2-19 under this section. If a rental company elects to include the 2-20 reimbursement charge, the charge shall be nondiscriminatory and 2-21 must be collected from all persons entering into rental agreements 2-22 with the rental company except those persons exempted by this 2-23 article. 2-24 Sec. 4. NOTICE OF CHARGE. The reimbursement charge, if any, 2-25 must be: 2-26 (1) listed on the face of the rental agreement above 2-27 the place where the applicable tax is listed; and 3-1 (2) labeled as "Reimbursement for Title, Registration, 3-2 and Personal Property Taxes" or by the abbreviation "Reimb--TRPPT." 3-3 Sec. 5. COMPUTATION OF CHARGE. (a) The amount of the 3-4 reimbursement charge applicable to each rental agreement is the 3-5 amount of personal property taxes, registration fees, and title 3-6 fees paid on the rental company's motor vehicle fleet in this state 3-7 during the calendar year preceding the year of the computation 3-8 divided by the cumulative number of rental days for which the 3-9 rental company rented motor vehicles during that preceding year and 3-10 multiplied by the number of rental days covered by the rental 3-11 agreement. 3-12 (b) A rental company shall make the computation authorized 3-13 by this section before January 15 of the year during which the 3-14 computation applies and begin collecting the computed amount on the 3-15 day after the date of the computation. A rental company which 3-16 fails to make the computation before January 15 may not charge any 3-17 amount under this article on or after January 15 until it makes the 3-18 requisite computation. The amount applicable to a year may not be 3-19 altered after initial computation. 3-20 Sec. 6. DURATION OF COLLECTION. (a) A rental company may 3-21 collect the reimbursement charge from each renter to which the 3-22 charge applies until the earlier of January 15 of the following 3-23 year or the date on which: 3-24 (1) the rental company collects charges totaling the 3-25 amount of personal property taxes, registration fees, and title 3-26 fees paid on the rental company's motor vehicle fleet in this state 3-27 during the preceding calendar year; or 4-1 (2) the computation for the following year takes 4-2 effect. 4-3 (b) After the amount described by Subsection (a)(1) of this 4-4 section is collected, the rental company may not collect the 4-5 reimbursement charge and shall list "$0.00" in the place where the 4-6 reimbursement charge is required to be listed on a rental 4-7 agreement. 4-8 Sec. 7. EXCESSIVE OR DEFICIENT COLLECTION. (a) If a rental 4-9 company collects in reimbursement charges more than the company is 4-10 entitled to collect under this article, the rental company shall 4-11 subtract the amount of the excess from the amount the rental 4-12 company is entitled to collect during the following year. 4-13 (b) If a rental company collects in reimbursement charges 4-14 less than the company is entitled to collect under this article, 4-15 the rental company may not adjust the amount collected during the 4-16 following year or otherwise attempt to collect the deficiency. 4-17 Sec. 8. CHARGE SUBJECT TO TAX. A reimbursement charge is 4-18 subject to the gross rental receipts tax. 4-19 Sec. 9. CIVIL PENALTY. (a) A rental company that violates 4-20 this article is liable to the state for a civil penalty in an 4-21 amount of not less than $500 and not more than $1,000 for each 4-22 violation or each day of a continuing violation. 4-23 (b) The attorney general or a county or district attorney 4-24 may sue to recover the civil penalty for the state, to enjoin a 4-25 violation of this article, or for both the penalty and injunction. 4-26 SECTION 2. This Act takes effect January 1, 1996. 4-27 SECTION 3. The importance of this legislation and the 5-1 crowded condition of the calendars in both houses create an 5-2 emergency and an imperative public necessity that the 5-3 constitutional rule requiring bills to be read on three several 5-4 days in each house be suspended, and this rule is hereby suspended.