SRC-PNG H.B. 3449 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 3449
76R10080 CMR-FBy: Gutierrez (Lucio)
Economic Development
5/13/1999
Engrossed


DIGEST 

Currently, employers pay into the unemployment fund based on a variable
rate scale. The Texas Workforce Commission (commission) computes each
employer's tax rate by dividing the amount of money that the state pays in
claims against that employer by the amount of taxable income that the
employer paid in the same period. The commission then sets a minimum and
maximum tax rate. This year, the minimum is 0.24 percent and the maximum is
6.24 percent. The law currently gives cotton ginning employers the choice
to pay the rate that the commission computes or a flat rate of 5.4 percent,
but the employers must choose which they will pay in advance. Cotton
ginning employers are given this option because, by nature, they only
employ people seasonally. Other crop preparation employers are not given
the same option even though they are primarily seasonal employers as well.
H.B. 3449 extends this exemption to fruit and vegetable packing sheds that
perform the same functions as cotton gins but on crops other than cotton.  

PURPOSE

As proposed, H.B. 3449 extends the choice of certain employers to pay the
rate that the Texas Workforce Commission computes or a flat rate of 5.4
percent to fruit and vegetable packing sheds.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 204.007, Labor Code, as follows: 

Sec. 204.007. New heading: SPECIAL RATE; CERTAIN EMPLOYERS ENGAGED IN
AGRICULTURE. Provides that this section applies to an employer identified
by the Texas Workforce Commission as classified in the Standard Industrial
Classification Manual published by the United States Office of Management
and Budget as Number 0723, crop preparation services for market. Authorizes
an employer subject to this section to elect to pay a contribution at a
total fixed rate of five and four-tenths percent instead of paying a
contribution computed on the specified tax rates. Makes conforming changes.

SECTION 2. Effective date: September 1, 1999.

SECTION 3. Emergency clause.