By Oliveira H.B. No. 2001
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the enterprise zone program.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 2303.052(d), Government Code, is amended
1-5 to read as follows:
1-6 (d) On or before December 15 [
1] of each year the department
1-7 shall submit to the governor, the legislature, and the Legislative
1-8 Budget Board a report that:
1-9 (1) evaluates the effectiveness of the enterprise zone
1-11 (2) describes the use of state and local incentives
1-12 under this chapter and their effect on revenue; and
1-13 (3) suggests legislation.
1-14 SECTION 2. Section 2303.0525(a), Government Code, is amended
1-15 to read as follows:
1-16 (a) On or before December 15 [ 1] of each even-numbered year,
1-17 the department shall prepare a cost-benefit analysis of the
1-18 enterprise zone program.
1-19 SECTION 3. Sections 2303.104(b) and (c), Government Code,
1-20 are amended to read as follows:
1-21 (b) At least three [ one] of the incentives summarized under
1-22 Subsection (a)(3) must not apply throughout the governmental entity
1-23 or entities nominating the area as an enterprise zone. At least
1-24 two of the incentives summarized under Subsection (a)(3) must be
2-1 financial incentives.
2-2 (c) This section does not prohibit a municipality or county
2-3 from extending additional incentives, including tax incentives, for
2-4 business enterprises in an enterprise zone by a separate ordinance
2-5 or order or by a written agreement.
2-6 SECTION 4. Section 2303.109(a), Government Code, is amended
2-7 to read as follows:
2-8 (a) An area may be designated as an enterprise zone for a
2-9 maximum of five [ seven] years. A designation remains in effect
2-10 until September 1 of the final year of the designation.
2-11 SECTION 5. Section 2303.401, Government Code, is amended to
2-12 read as follows:
2-13 Sec. 2303.401. DEFINITIONS [ DEFINITION]. In this subchapter:
2-14 (1) "New[ , "new] permanent job" means a new employment
2-15 position created by a qualified business as described by Section
2-16 2303.402 that:
2-17 (A) [ (1)] has provided at least 1,820 hours of
2-18 employment a year to a qualified employee; and
2-19 (B) [ (2)] is intended to exist during the period
2-20 that the qualified business is designated as an enterprise project
2-21 under Section 2303.406.
2-22 (2) "Retained job" means a job that existed with a
2-23 qualified business before designation as an enterprise project
2-25 (A) has provided employment to a qualified
2-26 employee of at least 1,820 hours annually; and
2-27 (B) is intended to be an employment position
3-1 retained during the period the business is designated as an
3-2 enterprise project in accordance with Chapter 151, Tax Code.
3-3 SECTION 6. Section 2303.403, Government Code, is amended to
3-4 read as follows:
3-5 Sec. 2303.403. PROHIBITION ON QUALIFIED BUSINESS
3-6 CERTIFICATION. If the department determines that the governing
3-7 body of an enterprise zone is not complying with this chapter, the
3-8 department shall prohibit the certification of a qualified business
3-9 in the zone until the department determines that the governing body
3-10 is complying with this chapter. The department may not designate
3-11 more than 65 businesses as enterprise projects during the [ any]
3-12 biennium beginning September 1, 1997 or September 1, 1999. The
3-13 department in its discretion may withhold up to five project slots
3-14 from designation. For the biennium beginning September 1, 1997, a
3-15 governing body may not have more than two qualified businesses
3-16 designated as regular enterprise projects or more than four
3-17 qualified businesses designated as bonus projects.
3-18 SECTION 7. Sections 2303.406(a) and (b), Government Code,
3-19 are amended to read as follows:
3-20 (a) The department may designate a business as an enterprise
3-21 project only if the department determines that:
3-22 (1) the business is a qualified business under Section
3-23 2303.402 that:
3-24 (A) is located in or has made a substantial
3-25 commitment to locate in an enterprise zone described by Section
3-26 2303.404(b); and
3-27 (B) has made a commitment to create at least:
4-1 (i) 10 jobs, if the company is locating in
4-2 an enterprise zone in which the community has a population equal to
4-3 or less than 50,000, according to the most recent estimates based
4-4 on the most recent decennial census provided by the State Data
4-5 Center; or
4-6 (ii) 25 jobs, if the company is locating
4-7 in an enterprise zone in which the community has a population of
4-8 more than 50,000, according to the most recent estimates based on
4-9 the most recent decennial census provided by the State Data Center;
4-10 (2) the governing body of the enterprise zone making
4-11 the application has demonstrated that a high level of cooperation
4-12 exists among public, private, and neighborhood entities in the
4-13 zone; and
4-14 (3) the designation will contribute significantly to
4-15 the achievement of the plans of the governing body making the
4-16 application for development and revitalization of the zone.
4-17 (b) The department shall designate qualified businesses as
4-18 enterprise projects on a competitive basis. The department shall
4-19 establish a minimum scoring threshold that must be met by a
4-20 qualified business applying for a project designation and make its
4-21 designation decisions using a weighted scale in which:
4-22 (1) 20 [ 50] percent of the evaluation depends on the
4-23 economic distress of:
4-24 (A) the enterprise zone in which a proposed
4-25 enterprise project is located; and
4-26 (B) the area within the enterprise zone where
4-27 the project is located;
5-1 (2) 20 [ 25] percent of the evaluation depends on the
5-2 local public effort used for the project to achieve development
5-3 and revitalization of the enterprise zone; [ and]
5-4 (3) 40 [ 25] percent of the evaluation depends on the
5-5 [ evaluation criteria as determined by the department, which must
5-7 [ (A) the] level of cooperation and support the
5-8 project applicant commits to the revitalization goals of the zone;
5-10 (4) 20 percent of the evaluation depends on
5-11 [ (B)] the type and wage level of the jobs to be
5-12 created or retained by the business.
5-13 SECTION 8. Section 2303.407, Government Code, is amended to
5-14 read as follows:
5-15 Sec. 2303.407. ALLOCATION OF JOBS ELIGIBLE FOR TAX REFUND.
5-16 When the department designates a business as an enterprise project,
5-17 the department shall allocate to the project the maximum number of
5-18 new permanent jobs or retained jobs eligible to be included in a
5-19 computation of a tax refund for the project. The number may not
5-20 exceed 500 [ 625] or a number equal to 110 percent of the number of
5-21 anticipated new permanent jobs or retained jobs specified in the
5-22 application for designation of the business as an enterprise
5-23 project under Section 2303.405, whichever is less.
5-24 SECTION 9. Sections 151.429(b) and (g), Tax Code, are
5-25 amended to read as follows:
5-26 (b) Subject to the limitations provided by Subsection (c) of
5-27 this section, an enterprise project qualifies for a refund of taxes
6-1 under this section of $2,500 [ $2,000] for each new permanent job or
6-2 job that has been retained by the enterprise project for a
6-3 qualified employee.
6-4 (g) The refund provided by this section is conditioned on
6-5 the enterprise project maintaining at least the same level of
6-6 employment of qualified employees as existed at the time it
6-7 qualified for a refund for a period of three years from that date.
6-8 The Texas Department of Commerce shall annually certify to the
6-9 comptroller [ and the Legislative Budget Board] whether that level
6-10 of employment of qualified employees has been maintained. On the
6-11 Texas Department of Commerce certifying that such a level has not
6-12 been maintained, the comptroller shall assess that portion of the
6-13 refund attributable to any such decrease in employment, including
6-14 penalty and interest from the date of the refund.
6-15 SECTION 10. Section 171.1015(g), Tax Code, is amended to
6-16 read as follows:
6-17 (g) Only enterprise projects [ qualified businesses] that
6-18 have been certified as eligible for a tax deduction under this
6-19 section by the Texas Department of Commerce to the comptroller may
6-20 apply for [ and the Legislative Budget Board are entitled to] the
6-21 tax deduction.
6-22 SECTION 11. Section 2303.110(d), Government Code, and
6-23 Section 171.501, Tax Code, are repealed.
6-24 SECTION 12. The change made to Section 2303.109(a),
6-25 Government Code, by this Act does not affect the term of a
6-26 designation of an area as an enterprise zone made before the
6-27 effective date of this Act.
7-1 SECTION 13. This Act takes effect September 1, 1997.
7-2 SECTION 14. The importance of this legislation and the
7-3 crowded condition of the calendars in both houses create an
7-4 emergency and an imperative public necessity that the
7-5 constitutional rule requiring bills to be read on three several
7-6 days in each house be suspended, and this rule is hereby suspended.