SRC-SLL C.S.S.B. 988 75(R)BILL ANALYSIS


Senate Research CenterC.S.S.B. 988
By: Brown
Natural Resources
3-19-97
Committee Report (Substituted)


DIGEST 

Currently, crude oil production is reported for severance tax purposes at
the county level.  However, this has proved inadequate.  The current
system of county-level data cannot capture the relationship between buyers
and sellers, which leaves the State Comptroller's Office without a means
to document the price paid for oil at the point of sale.  Natural gas is
reported at the individual lease level, the level at which all primary
business records are kept.  Lease level reporting would provide the data
needed for market-level analysis and pre-audit analysis.  This bill will
require records and reports from certain producers and purchasers of oil
to be at the lease level. 

PURPOSE

As proposed, C.S.S.B. 988 requires records and reports from certain
producers and purchasers of oil to be at the lease level. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 202.201(a), Tax Code, to require the report to
be submitted to the comptroller by a producer to include the number of
barrels of oil produced from each lease, the county in which each lease is
located from which oil was produced, certain information on each first
purchaser of oil and for each purchaser, the amount of oil purchased from
each lease, the payment received for the oil from each first purchaser for
each lease from which oil was produced, and the lease identification
number of each lease from which oil was produced.  Makes conforming
changes. 

SECTION 2. Amends Section 202.202(a), Tax Code, to make conforming changes.

SECTION 3. Emergency clause.
  Effective date: upon passage.

SUMMARY OF COMMITTEE CHANGES

SECTION 1.

Deletes proposed amendments to Sections 202.101 and 202.102, Tax Code. 

Amends Section 202.201(a), Tax Code, previously designated as SECTION 2,
to delete proposed amendments.  Requires information provided to the
comptroller to be broken down by lease. 

SECTION 2.

Amends Section 202.202(a), Tax Code, previously designated as SECTION 3,
to make conforming changes. 


 
SECTION 3.

Deletes existing SECTIONS 4 and 5, regarding the effective date,
application of the Act, and the emergency clause. 

Adds SECTION 3, to include the emergency clause and provide that the Act
is effective upon passage.