JH S.B. 974 75(R)    BILL ANALYSIS


URBAN AFFAIRS
S.B. 974
By: Carona (Hill)
4-18-97
Committee Report (Unamended)



BACKGROUND 

Currently, Texas law requires a taxing unit which intends to resell the
property it has foreclosed on for taxes to resell it only for the total
amount of taxes due or the market value of the property, whichever is
less. The taxing unit is not allowed to make a profit. As a result, many
properties which have underground storage tanks are not foreclosed on by
jurisdictions because no buyer is willing to purchase the property with
potentially hazardous environmental problems. Moreover, the taxing
jurisdictions lack incentive to incur the costs of cleanup because they
are unable to recoup those costs when reselling the property. This bill
would add a provision to current law to allow a taxing jurisdiction that
incurs environmental cleanup costs to add those costs into the resale
price, thereby enabling taxing jurisdictions to foreclose on the property,
clean up the property, and resell it. 

PURPOSE

As proposed, S.B. 974 allows a taxing jurisdiction to recover from the
proceeds of a resale of a property it has foreclosed on any cost incurred
in inspecting the property to determine whether there is a release or
threatened release of waste, and in taking action to clean up any such
waste. 

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 34.06, Tax Code, by adding Subsection (c), to
provide that notwithstanding Subsection (b), the purchasing taxing unit is
entitled to recover from the proceeds of a resale of the property any cost
incurred in inspecting the property to determine whether there is a
release or threatened release of solid waste from the property in
violation of Chapter 361, Health and Safety Code, or a rule adopted or
permit or order issued by the Texas Natural Resource Conservation
Commission under that chapter, or a discharge or threatened discharge of
waste or a pollutant into or adjacent to water in this state from a point
of discharge on the property in violation of Chapter 26, Water Code, or a
rule adopted or permit or order issued by the commission under that
chapter, and in taking action to remove or remediate the release or
threatened release or discharge or threatened discharge regardless of
whether the taxing unit was required by law to incur the cost, or obtained
the consent of each taxing unit entitled to receive proceeds of the sale
under the judgment of foreclosure to incur the cost. 

SECTION 2. Emergency clause. Effective date: upon passage.