1-1     By:  Galloway                                          S.B. No. 643

 1-2           (In the Senate - Filed February 18, 1997; February 20, 1997,

 1-3     read first time and referred to Committee on Economic Development;

 1-4     April 25, 1997, reported adversely, with favorable Committee

 1-5     Substitute by the following vote:  Yeas 10, Nays 0; April 25, 1997,

 1-6     sent to printer.)

 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 643                By:  Patterson

 1-8                            A BILL TO BE ENTITLED

 1-9                                   AN ACT

1-10     relating to the rate applicable to certain successor employers for

1-11     contributions under the unemployment compensation system.

1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-13           SECTION 1.  Section 204.085, Labor Code, is amended to read

1-14     as follows:

1-15           Sec. 204.085.  CONTRIBUTION RATE FOR SUCCESSOR EMPLOYER.

1-16     (a)  If, on the date of an acquisition, at least one of the

1-17     employing units that is a party to the acquisition is an

1-18     experience-rated employer, and the [A] successor employing unit

1-19     [that] is subject to Section 204.083 or 204.084, the successor

1-20     employing unit [and is an experience-rated employer on the date of

1-21     acquisition] shall pay contributions from the effective date of the

1-22     acquisition as provided by Section 204.082 until the end of the

1-23     calendar year in which the acquisition occurred at a [the] rate

1-24     computed by adding together the compensation experience of all the

1-25     employing units that are parties to the acquisition for the 12

1-26     calendar quarters preceding the quarter in which [applicable to the

1-27     successor employing unit on the date of] the acquisition occurred

1-28     and using that combined experience to compute an aggregate

1-29     experience rate.

1-30           (b)  If, on the date of an acquisition, no employing unit

1-31     that is a party to the acquisition is an experience-rated employer,

1-32     and the [A] successor employing unit [that] is subject to Section

1-33     204.083 or 204.084, the successor employing unit [and is not an

1-34     experience-rated employer on the date of the acquisition] shall pay

1-35     contributions at the rates prescribed by Section 204.0065 and

1-36     Section 204.121, if [from the date of] the acquisition occurs

1-37     before January 1, 2000, and at the rate prescribed by Section

1-38     204.006, if the acquisition occurs on or after January 1, 2000,

1-39     until the successor employing unit is eligible for an experience

1-40     rate under Section 204.041.  The rate under Section 204.041 shall

1-41     be computed by adding together the compensation experience of all

1-42     employing units that are parties [next tax rate computation date at

1-43     the highest rate applicable at the time of the acquisition to any

1-44     predecessor employer who is a party] to the acquisition and using

1-45     it to compute an aggregate experience rate.

1-46           SECTION 2.  This Act takes effect September 1, 1997, and

1-47     applies only to a computation of an experience rate for

1-48     unemployment compensation contributions made by the Texas Workforce

1-49     Commission as a result of an acquisition that occurs on or after

1-50     the effective date of this Act.  A computation of an experience

1-51     rate for unemployment compensation contributions made by the Texas

1-52     Workforce Commission as a result of an acquisition that occurs

1-53     before the effective date of this Act is governed by the law in

1-54     effect on the date that the acquisition occurs, and the former law

1-55     is continued in effect for that purpose.

1-56           SECTION 3.  The importance of this legislation and the

1-57     crowded condition of the calendars in both houses create an

1-58     emergency and an imperative public necessity that the

1-59     constitutional rule requiring bills to be read on three several

1-60     days in each house be suspended, and this rule is hereby suspended.

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