Amend CSHB 209 (House committee report) by striking all below
the enacting clause and substituting the following:
      SECTION 1.  Subchapter H, Chapter 151, Tax Code, is amended
by adding Section 151.326 to read as follows:
      Sec. 151.326.  SCHOOL SUPPLIES BEFORE START OF SCHOOL.  (a)
The sale or storage, use, or other consumption of a school supply
is exempted from the taxes imposed by this chapter if the school
supply is purchased:
            (1)  for use by a student in a class in a public or
private elementary or secondary school;
            (2)  during August; and
            (3)  for a sales price of less than $25 per item.
      (b)  For purposes of this exemption, "school supply" means:
            (1)  crayons;
            (2)  scissors;
            (3)  glue, paste, and glue sticks;
            (4)  pencils;
            (5)  pens;
            (6)  erasers;
            (7)  rulers;
            (8)  markers;
            (9)  highlighters;
            (10)  paper, including loose-leaf ruled notebook paper,
copy paper, graph paper, tracing paper, manila paper, colored
paper, poster board, and construction paper;
            (11)  writing tablets;
            (12)  spiral notebooks;
            (13)  bound composition notebooks;
            (14)  pocket folders;
            (15)  plastic folders;
            (16)  expandable portfolios;
            (17)  manila folders;
            (18)  three-ring binders that are three inches or less
in capacity;
            (19)  zipper pencil bags;
            (20)  school supply boxes;
            (21)  clipboards;
            (22)  index cards;
            (23)  index card boxes;
            (24)  calculators;
            (25)  protractors;
            (26)  compasses;
            (27)  music notebooks;
            (28)  sketch or drawing pads;
            (29)  paintbrushes;
            (30)  watercolors;
            (31)  acrylic, tempera, or oil paints;
            (32)  tape, including masking tape and scotch tape;
            (33)  clay and glazes;
            (34)  pencil sharpeners;
            (35)  thesauruses; and
            (36)  dictionaries.
      (c)  A retailer is not required to obtain an exemption
certificate stating that the school supplies are purchased for use
by a student in a class in a public or private elementary or
secondary school unless the supplies are purchased in a quantity
that indicates that the supplies are not purchased for use by a
student in a class in a public or private elementary or secondary
school.
      SECTION 2.  (a)  Notwithstanding any other provision of this
Act, the governing body of a local taxing authority that imposes a
local sales and use tax may repeal an exemption to that tax
authorized by this Act if the governing body finds by an
appropriate order, including an ordinance, that the exemption would
materially impair the obligation of any contract existing at the
time this Act goes into effect and to which the local taxing
authority is a party.
      (b)  The secretary of the local taxing authority adopting an
order under this section shall send to the comptroller by certified
or registered mail a copy of the order.
      (c)  The repeal of the exemption takes effect on the first
day of the month following the expiration of the calendar quarter
occurring after the date on which the comptroller receives a copy
of the order.
      SECTION 3.  (a)  This Act takes effect on the first day of
the first calendar quarter beginning on or after the date that it
may take effect under Section 39, Article III, Texas Constitution.
      (b)  The change in law made by this Act does not affect taxes
imposed before the effective date of this Act, and the law in
effect before the effective date of this Act is continued in effect
for purposes of the liability for and collection of those taxes.
      SECTION 4.  The importance of this legislation and the
crowded condition of the calendars in both houses create an
emergency and an imperative public necessity that the
constitutional rule requiring bills to be read on three several
days in each house be suspended, and this rule is hereby suspended,
and that this Act take effect and be in force according to its
terms, and it is so enacted.