By Puente                                              H.B. No. 399
         76R989 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to a franchise tax credit for donation of certain
 1-3     environmentally sensitive land.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Subchapter A, Chapter 171, Tax Code, is amended
 1-6     by adding Section 171.003 to read as follows:
 1-7           Sec. 171.003.  CREDIT FOR DONATION OF CERTAIN ENVIRONMENTALLY
 1-8     SENSITIVE LAND.  (a)  A corporation is entitled to a credit on the
 1-9     tax due under  this chapter in an amount and in the manner provided
1-10     by this section if the corporation:
1-11                 (1)  donates land to:
1-12                       (A)  a governmental entity of this state; or
1-13                       (B)  a nonprofit organization that operates in
1-14     this state and whose primary purpose is the protection of the
1-15     environment; and
1-16                 (2)  all or a portion of the land is located in a
1-17     recharge zone over an aquifer.
1-18           (b)  The amount of the credit is 25 percent of the market
1-19     value of the portion of the donated land that is located in a
1-20     recharge zone over an aquifer.
1-21           (c)  A corporation must apply for the credit on or with the
1-22     tax report for the period for which the credit is claimed.  The
1-23     comptroller shall promulgate a form for the application for the
1-24     credit.  A corporation must use this form in applying for the
 2-1     credit.
 2-2           (d)  A corporation must provide to the comptroller any
 2-3     information the comptroller requires to determine the validity of a
 2-4     claim for the credit.  The burden of establishing entitlement to
 2-5     and the value of the credit is on the corporation.
 2-6           (e)  The credit applies only to the privilege period in which
 2-7     the land was donated except that a  corporation may carry all or
 2-8     part of the credit forward for not more than five consecutive
 2-9     privilege periods.
2-10           (f)  A corporation may not claim a credit in an amount that
2-11     exceeds the amount of tax due for the privilege period.
2-12           (g)  A corporation may not convey, assign, or transfer the
2-13     credit to another entity.
2-14           SECTION 2.  A corporation may claim the credit under Section
2-15     171.003, Tax Code, as added by this Act, only for land donated on
2-16     or after the effective date of this Act and only on a franchise tax
2-17     report due under Chapter 171, Tax Code, on or after January 1,
2-18     2000.
2-19           SECTION 3.  The importance of this legislation and the
2-20     crowded condition of the calendars in both houses create an
2-21     emergency and an imperative public necessity that the
2-22     constitutional rule requiring bills to be read on three several
2-23     days in each house be suspended, and this rule is hereby suspended,
2-24     and that this Act take effect and be in force from and after its
2-25     passage, and it is so enacted.