HBA-JRA H.B. 1785 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 1785
By: Dutton
Ways & Means
4/8/1999
Introduced



BACKGROUND AND PURPOSE 

The Transportation Code provides that transportation authorities are funded
through sales and use taxes.  State law imposes a two percent cap for local
sales taxes in any location in the state.  Transit authorities are not
allowed to impose different tax rates with the territory of the authority.
H.B. 1785 returns one-half of the sales and use tax collected by certain
transit authorities to the municipality or county from which it was
collected upon request of the municipality or county, but provides that
such money may only be spent for the internal transportation needs of and
traffic management in the municipality or county. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Comptroller of Public Accounts in
SECTION 1 (Section 322.3025, Tax Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter D, Chapter 322, Tax Code, by adding Section
322.3025, as follows: 

Sec. 322.3025.  DISTRIBUTION OF SALES AND USE TAX TO CERTAIN POLITICAL
SUBDIVISIONS.  (a)  Makes this section applicable to a transit authority in
which the principal municipality has a population of more than 1.2 million. 

(b)   Requires the Comptroller of Public Accounts (comptroller) to remit to
the municipality one-half of the sales and use tax collected for the
authority in the territory of the municipality on the request of the
governing body of a municipality that is located in that authority. 

(c)  Requires the comptroller to remit to the county one-half of the sales
and use tax collected for the authority in the unincorporated territory of
the county on the request of the commissioners court of a county that is
located in that authority. 

(d)  Authorizes the money remitted to a municipality or county under this
section to be spent only for the internal transportation needs of and
traffic management in the municipality or county. 

(e)  Requires the comptroller, by rule,  to establish the date a request
under Subsection (b) or (c) takes effect and the process by which a
municipality or county may revoke or rescind its request. 

(f)  Defines "authority" and "principal municipality" in this section.

SECTION 2.  Effective date: September 1, 1999.

SECTION 3.  Emergency clause.