By Chavez                                       H.B. No. 2139

      75R3196 DAK-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to a franchise tax credit for the creation of jobs in

 1-3     counties with high unemployment.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Chapter 171, Tax Code, is amended by adding

 1-6     Subchapter N to read as follows:

 1-7               SUBCHAPTER N.  TAX CREDIT FOR CREATION OF JOBS

 1-8                     IN COUNTIES WITH HIGH UNEMPLOYMENT

 1-9           Sec. 171.701.  CREDIT.  A corporation that meets the

1-10     eligibility requirements under this subchapter is entitled to a

1-11     credit in the amount allowed by this subchapter against the tax

1-12     imposed by this chapter.

1-13           Sec. 171.702.  ELIGIBILITY.  A corporation is eligible for

1-14     the credit under this subchapter if the corporation demonstrates to

1-15     the comptroller that:

1-16                 (1)  on or after September 1, 1997, the corporation has

1-17     created a minimum of 100 jobs in a county in which the unemployment

1-18     rate was above 10 percent during the period in which the jobs were

1-19     created;

1-20                 (2)  of the jobs described under Subdivision (1):

1-21                       (A)  at least half are intended to provide a

1-22     minimum of 1,820 hours of employment a year and exist for a minimum

1-23     of five years;

1-24                       (B)  at least half pay a wage that is 25 percent

 2-1     or more above the median wage for the county; and

 2-2                       (C)  none were first created outside the county

 2-3     by the corporation and then transferred into the county; and

 2-4                 (3)  for the privilege period for which the corporation

 2-5     seeks eligibility for the credit, the corporation maintained the

 2-6     jobs described by Subdivision (1) under the conditions described by

 2-7     Subdivision (2).

 2-8           Sec. 171.703.  AMOUNT AND DURATION OF CREDIT.  (a)  A

 2-9     corporation eligible for the credit under Section 171.702 is

2-10     entitled to a credit equal to 15 percent of the amount of taxes

2-11     that the corporation owes under this chapter for each privilege

2-12     period in which the corporation is eligible for a period not to

2-13     exceed five years.

2-14           (b)  The credit is cumulative and applies to each increment

2-15     of at least 100 jobs created, and a corporation may be eligible for

2-16     more than one credit at a time, except that the total credits

2-17     claimed under this subchapter for a privilege period may not exceed

2-18     the amount of net franchise tax due for the privilege period after

2-19     any other applicable tax credits.

2-20           Sec. 171.704.  APPLICATION FOR CREDIT.  (a)  A corporation

2-21     must apply for a credit under this subchapter on or with the tax

2-22     report for the period for which the credit is claimed.

2-23           (b)  The comptroller shall promulgate a form for the

2-24     application for the credit.  A corporation must use this form in

2-25     applying for the credit.

2-26           SECTION 2.  The importance of this legislation and the

2-27     crowded condition of the calendars in both houses create an

 3-1     emergency and an imperative public necessity that the

 3-2     constitutional rule requiring bills to be read on three several

 3-3     days in each house be suspended, and this rule is hereby suspended,

 3-4     and that this Act take effect and be in force from and after its

 3-5     passage, and it is so enacted.