JWB S.B. 582 75(R)BILL ANALYSIS


WAYS & MEANS
S.B. 582
By: Ratliff (Holzheauser)
4-11-97
Committee Report (Unamended)



BACKGROUND 

Section 202.054, Tax Code (Qualification of Oil From New or Expanded
Enhanced Recovery Project for Special Tax Rate), provides an incentive
program for Enhanced Oil Recovery. There is a 50 percent reduction in the
severance tax rate for all new oil projects. In 1991 this was expanded to
include a 50 percent tax credit for existing oil projects.  However, the
program is set to expire January 1, 1998.  

PURPOSE

This bill extends the application period for a new enhanced oil recovery
project or expansion of an existing enhanced oil recovery project from the
current date of January 1, 1998, to January 1, 2008. 

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 202.054(b), Tax Code, to remove co-production
projects from eligibility for the tax incentive. 

SECTION 2.Amends Section 202.054(c), Tax Code, to extend the filing
deadline for applications for a new enhanced recovery project or an
expansion of an existing enhanced recovery project from January 1, 1998,
to January 1, 2008.  Also removes co-production projects from eligibility
for the incentive. 

SECTION 3.Effective date: September 1, 1997.

SECTION 4.Emergency clause.