By: Lucio S.B. No. 1407
A BILL TO BE ENTITLED
AN ACT
1-1 relating to temporary tax exemptions for certain high-cost gas.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Subsection (e), Section 201.057, Tax Code, is
1-4 amended to read as follows:
1-5 (e) The operator of a proposed or existing gas well,
1-6 including a gas well that has not been completed, or the operator
1-7 of any proposed or existing oil or gas well within a commission
1-8 approved co-production project, may apply to the commission for
1-9 certification that the well produces or will produce high-cost gas.
1-10 Such application, if seeking certification as high-cost gas
1-11 according to Subsection (a)(2)(A), may be made at any time [must be
1-12 made in writing no later than the 180th day] after the first day of
1-13 production. The application may be made but is not required to be
1-14 made concurrently with a request for a determination that gas
1-15 produced from the well is high-cost natural gas for purposes of the
1-16 Natural Gas Policy Act of 1978 (15 U.S.C. Section 3301 et seq.) or
1-17 with a request for commission approval of a co-production project.
1-18 The commission may require an applicant to provide the commission
1-19 with any relevant information required to administer this section.
1-20 For purposes of this section, a determination that gas is high-cost
1-21 natural gas according to Subsection (a)(2)(A) or a determination
1-22 that gas is produced from within a commission approved
1-23 co-production project is a certification that the gas is high-cost
2-1 gas for purposes of this section, and in that event additional
2-2 certification is not required to qualify for the exemption or tax
2-3 reduction provided by this section.
2-4 SECTION 2. Subsection (f), Section 201.057, Tax Code, is
2-5 amended to read as follows:
2-6 (f) To qualify for the exemption or tax reduction provided
2-7 by this section, the person responsible for paying the tax must
2-8 apply to the comptroller. The application must contain the
2-9 certification of the commission that the well produces high-cost
2-10 gas and, if the application is for a well spudded or completed
2-11 after September 1, 1995, must contain a report of drilling and
2-12 completion costs incurred for each well on a form and in the detail
2-13 as determined by the comptroller. To obtain the maximum tax
2-14 exemption or tax reduction, an [An] application to the comptroller
2-15 for certification according to Subsection (a)(2)(A) may not be
2-16 filed after the 180th day after the first day of production or 45
2-17 days after the date of approval or certification by the commission,
2-18 whichever is later. If the application is filed after the 180th
2-19 day after the first day of production or 45 days after the date of
2-20 approval or certification by the commission, whichever is later,
2-21 then the tax exemption or tax reduction shall be reduced by an
2-22 amount equal to 10 percent of the tax exemption or tax reduction
2-23 for the period of time between the 180th day after the first day of
2-24 production and the day on which the application is filed with the
2-25 comptroller. An application to the comptroller for certification
3-1 according to Subsection (a)(2)(B) may not be filed before January
3-2 1, 1990, or after December 31, 1998. The comptroller shall approve
3-3 the application of a person who demonstrates that the gas is
3-4 eligible for the exemption or tax reduction. The comptroller may
3-5 require a person applying for the exemption or tax reduction to
3-6 provide any relevant information in the person's monthly report
3-7 that the comptroller considers necessary to administer this
3-8 section. The commission shall notify the comptroller in writing
3-9 immediately if it determines that an oil or gas well previously
3-10 certified as producing high-cost gas does not produce high-cost gas
3-11 or if it takes any action or discovers any information that affects
3-12 the eligibility of gas for an exemption or tax reduction under this
3-13 section.
3-14 SECTION 3. The importance of this legislation and the
3-15 crowded condition of the calendars in both houses create an
3-16 emergency and an imperative public necessity that the
3-17 constitutional rule requiring bills to be read on three several
3-18 days in each house be suspended, and this rule is hereby suspended,
3-19 and that this Act take effect and be in force from and after its
3-20 passage, and it is so enacted.