75R10451 CBH-D
By Lucio S.B. No. 1407
Substitute the following for S.B. No. 1407:
By Williamson C.S.S.B. No. 1407
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the tax exemption or reduction for certain high-cost
1-3 gas.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 201.057(e) and (f), Tax Code, are
1-6 amended to read as follows:
1-7 (e) The operator of a proposed or existing gas well,
1-8 including a gas well that has not been completed, or the operator
1-9 of any proposed or existing oil or gas well within a commission
1-10 approved co-production project, may apply to the commission for
1-11 certification that the well produces or will produce high-cost gas.
1-12 Such application, if seeking certification as high-cost gas
1-13 according to Subsection (a)(2)(A), may be made at any time [must be
1-14 made in writing no later than the 180th day] after the first day
1-15 of production. The application may be made but is not required to
1-16 be made concurrently with a request for a determination that gas
1-17 produced from the well is high-cost natural gas for purposes of the
1-18 Natural Gas Policy Act of 1978 (15 U.S.C. Section 3301 et seq.) or
1-19 with a request for commission approval of a co-production project.
1-20 The commission may require an applicant to provide the commission
1-21 with any relevant information required to administer this section.
1-22 For purposes of this section, a determination that gas is high-cost
1-23 natural gas according to Subsection (a)(2)(A) or a determination
1-24 that gas is produced from within a commission approved
2-1 co-production project is a certification that the gas is high-cost
2-2 gas for purposes of this section, and in that event additional
2-3 certification is not required to qualify for the exemption or tax
2-4 reduction provided by this section.
2-5 (f) To qualify for the exemption or tax reduction provided
2-6 by this section, the person responsible for paying the tax must
2-7 apply to the comptroller. The application must contain the
2-8 certification of the commission that the well produces high-cost
2-9 gas and, if the application is for a well spudded or completed
2-10 after September 1, 1995, must contain a report of drilling and
2-11 completion costs incurred for each well on a form and in the detail
2-12 as determined by the comptroller. Notwithstanding any other
2-13 provision of this section, to obtain the maximum tax exemption or
2-14 tax deduction, an [An] application to the comptroller for
2-15 certification according to Subsection (a)(2)(A) may not be filed
2-16 after the later of the 180th day after the first day of production
2-17 or the 45th day after the date of approval or certification by the
2-18 commission. If the application is not filed by the applicable
2-19 deadline, the tax exemption or tax deduction is reduced by 10
2-20 percent for the period beginning on the 180th day after the first
2-21 day of production and ending on the date on which the application
2-22 is filed with the comptroller. An application to the comptroller
2-23 for certification according to Subsection (a)(2)(B) may not be
2-24 filed before January 1, 1990, or after December 31, 1998. The
2-25 comptroller shall approve the application of a person who
2-26 demonstrates that the gas is eligible for the exemption or tax
2-27 reduction. The comptroller may require a person applying for the
3-1 exemption or tax reduction to provide any relevant information in
3-2 the person's monthly report that the comptroller considers
3-3 necessary to administer this section. The commission shall notify
3-4 the comptroller in writing immediately if it determines that an oil
3-5 or gas well previously certified as producing high-cost gas does
3-6 not produce high-cost gas or if it takes any action or discovers
3-7 any information that affects the eligibility of gas for an
3-8 exemption or tax reduction under this section.
3-9 SECTION 2. This Act takes effect September 1, 1997. A
3-10 person who is otherwise qualified to file an application for
3-11 certification of high-cost gas with the Railroad Commission of
3-12 Texas may file an application under Section 201.057, Tax Code, as
3-13 amended by this Act, regardless of the date on which the gas was
3-14 first produced.
3-15 SECTION 3. The importance of this legislation and the
3-16 crowded condition of the calendars in both houses create an
3-17 emergency and an imperative public necessity that the
3-18 constitutional rule requiring bills to be read on three several
3-19 days in each house be suspended, and this rule is hereby suspended.