1-1 By: Lucio S.B. No. 1407
1-2 (In the Senate - Filed March 13, 1997; March 19, 1997, read
1-3 first time and referred to Committee on Finance; April 25, 1997,
1-4 reported favorably by the following vote: Yeas 11, Nays 0;
1-5 April 25, 1997, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to temporary tax exemptions for certain high-cost gas.
1-9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10 SECTION 1. Subsection (e), Section 201.057, Tax Code, is
1-11 amended to read as follows:
1-12 (e) The operator of a proposed or existing gas well,
1-13 including a gas well that has not been completed, or the operator
1-14 of any proposed or existing oil or gas well within a commission
1-15 approved co-production project, may apply to the commission for
1-16 certification that the well produces or will produce high-cost gas.
1-17 Such application, if seeking certification as high-cost gas
1-18 according to Subsection (a)(2)(A), may be made at any time [must be
1-19 made in writing no later than the 180th day] after the first day of
1-20 production. The application may be made but is not required to be
1-21 made concurrently with a request for a determination that gas
1-22 produced from the well is high-cost natural gas for purposes of the
1-23 Natural Gas Policy Act of 1978 (15 U.S.C. Section 3301 et seq.) or
1-24 with a request for commission approval of a co-production project.
1-25 The commission may require an applicant to provide the commission
1-26 with any relevant information required to administer this section.
1-27 For purposes of this section, a determination that gas is high-cost
1-28 natural gas according to Subsection (a)(2)(A) or a determination
1-29 that gas is produced from within a commission approved
1-30 co-production project is a certification that the gas is high-cost
1-31 gas for purposes of this section, and in that event additional
1-32 certification is not required to qualify for the exemption or tax
1-33 reduction provided by this section.
1-34 SECTION 2. Subsection (f), Section 201.057, Tax Code, is
1-35 amended to read as follows:
1-36 (f) To qualify for the exemption or tax reduction provided
1-37 by this section, the person responsible for paying the tax must
1-38 apply to the comptroller. The application must contain the
1-39 certification of the commission that the well produces high-cost
1-40 gas and, if the application is for a well spudded or completed
1-41 after September 1, 1995, must contain a report of drilling and
1-42 completion costs incurred for each well on a form and in the detail
1-43 as determined by the comptroller. To obtain the maximum tax
1-44 exemption or tax reduction, an [An] application to the comptroller
1-45 for certification according to Subsection (a)(2)(A) may not be
1-46 filed after the 180th day after the first day of production or 45
1-47 days after the date of approval or certification by the commission,
1-48 whichever is later. If the application is filed after the 180th
1-49 day after the first day of production or 45 days after the date of
1-50 approval or certification by the commission, whichever is later,
1-51 then the tax exemption or tax reduction shall be reduced by an
1-52 amount equal to 10 percent of the tax exemption or tax reduction
1-53 for the period of time between the 180th day after the first day of
1-54 production and the day on which the application is filed with the
1-55 comptroller. An application to the comptroller for certification
1-56 according to Subsection (a)(2)(B) may not be filed before January
1-57 1, 1990, or after December 31, 1998. The comptroller shall approve
1-58 the application of a person who demonstrates that the gas is
1-59 eligible for the exemption or tax reduction. The comptroller may
1-60 require a person applying for the exemption or tax reduction to
1-61 provide any relevant information in the person's monthly report
1-62 that the comptroller considers necessary to administer this
1-63 section. The commission shall notify the comptroller in writing
1-64 immediately if it determines that an oil or gas well previously
2-1 certified as producing high-cost gas does not produce high-cost gas
2-2 or if it takes any action or discovers any information that affects
2-3 the eligibility of gas for an exemption or tax reduction under this
2-4 section.
2-5 SECTION 3. The importance of this legislation and the
2-6 crowded condition of the calendars in both houses create an
2-7 emergency and an imperative public necessity that the
2-8 constitutional rule requiring bills to be read on three several
2-9 days in each house be suspended, and this rule is hereby suspended,
2-10 and that this Act take effect and be in force from and after its
2-11 passage, and it is so enacted.
2-12 * * * * *