1-1 AN ACT
1-2 relating to certain industrial development corporations, projects
1-3 of industrial development corporations, and the taxes levied for
1-4 projects.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 2(10), Development Corporation Act of
1-7 1979 (Article 5190.6, Vernon's Texas Civil Statutes), is amended to
1-8 read as follows:
1-9 (10) "Project" shall mean the land, buildings,
1-10 equipment, facilities, targeted infrastructure, and improvements
1-11 (one or more) to promote new and expanded business development or
1-12 found by the board of directors to be required or suitable for the
1-13 promotion of development and expansion of manufacturing and
1-14 industrial facilities, job creation and retention, job training,
1-15 educational facilities, transportation facilities (including but
1-16 not limited to airports, ports, mass commuting facilities, and
1-17 parking facilities), sewage or solid waste disposal facilities,
1-18 recycling facilities, air or water pollution control facilities,
1-19 facilities for the furnishing of water to the general public,
1-20 distribution centers, and small warehouse facilities capable of
1-21 serving as decentralized storage and distribution centers, and for
1-22 the promotion of development or redevelopment and expansion,
1-23 including costs of administration and operation, of a military base
1-24 closed or realigned pursuant to recommendation of the Defense
2-1 Closure and Realignment Commission pursuant to the Defense Base
2-2 Closure and Realignment Act of 1990 (10 U.S.C. Section 2687 note)
2-3 as amended, and of facilities which are related to any of the
2-4 foregoing, and in furtherance of the public purposes of this Act,
2-5 all as defined in the rules of the department, irrespective of
2-6 whether in existence or required to be identified, acquired, or
2-7 constructed thereafter. As used in this Act, the term "development
2-8 areas" shall mean any area or areas of a city that the city finds
2-9 and determines, after a public hearing, should be developed in
2-10 order to meet the development objectives of the city. In addition,
2-11 in blighted or economically depressed areas, development areas,
2-12 federally designated empowerment zones and enterprise communities
2-13 designated under Section 1391, Internal Revenue Code of 1986, or
2-14 federally assisted new communities located within a home-rule city
2-15 or a federally designated economically depressed county of less
2-16 than 50,000 persons according to the last federal decennial census,
2-17 a project may include the land, buildings, equipment, facilities,
2-18 and improvements (one or more) found by the board of directors to
2-19 be required or suitable for the promotion of commercial development
2-20 and expansion and in furtherance of the public purposes of this
2-21 Act, or for use by commercial enterprises, all as defined in the
2-22 rules of the department, irrespective of whether in existence or
2-23 required to be acquired or constructed thereafter. As used in this
2-24 Act, the term blighted or economically depressed areas shall mean
2-25 those areas and areas immediately adjacent thereto within a city
2-26 which by reason of the presence of a substantial number of
2-27 substandard, slum, deteriorated, or deteriorating structures, or
3-1 which suffer from a high relative rate of unemployment, or which
3-2 have been designated and included in a tax incremental district
3-3 created under Chapter 695, Acts of the 66th Legislature, Regular
3-4 Session, 1979 (Article 1066d, Vernon's Texas Civil Statutes), or
3-5 any combination of the foregoing, the city finds and determines,
3-6 after a hearing, substantially impair or arrest the sound growth of
3-7 the city, or constitute an economic or social liability and are a
3-8 menace to the public health, safety, or welfare in their present
3-9 condition and use. The department shall adopt guidelines that
3-10 describe the kinds of areas that may be considered to be blighted
3-11 or economically depressed. The city shall consider these
3-12 guidelines in making its findings and determinations. Notice of
3-13 the hearing at which the city considers establishment of a
3-14 development area or an economically depressed or blighted area
3-15 shall be posted at the city hall before the hearing.
3-16 "Federally assisted new communities" shall mean those
3-17 federally assisted areas which have received or will receive
3-18 assistance in the form of loan guarantees under Title X of the
3-19 National Housing Act and a portion of the federally assisted area
3-20 has received grants under Section 107(a)(1) of the Housing and
3-21 Community Development Act of 1974, as amended.
3-22 SECTION 2. Section 4A, Development Corporation Act of 1979
3-23 (Article 5190.6, Vernon's Texas Civil Statutes), is amended by
3-24 adding Subsection (c-1) to read as follows:
3-25 (c-1) The costs of a publicly owned and operated project
3-26 that is purchased or constructed under this section include the
3-27 maintenance and operating costs of the project. The proceeds of
4-1 taxes imposed under this section may be used to pay the maintenance
4-2 and operating costs of a project, unless not later than the 60th
4-3 day after the date notice of this specific use of the tax proceeds
4-4 is first published, the governing body of the city receives a
4-5 petition from more than 10 percent of the registered voters of the
4-6 city requesting that an election be held before the tax proceeds
4-7 may be used to pay the maintenance and operating costs of a
4-8 project.
4-9 SECTION 3. Section 4B(a)(1), Development Corporation Act of
4-10 1979 (Article 5190.6, Vernon's Texas Civil Statutes), is amended to
4-11 read as follows:
4-12 (1) "Eligible city" means a city:
4-13 (A) that is located in a county with a
4-14 population of 750,000 or more, according to the most recent federal
4-15 decennial census and in which the combined rate of all sales and
4-16 use taxes imposed by the city, the state, and other political
4-17 subdivisions of the state having territory in the city does not
4-18 exceed 8.25 [7.25] percent on the date of any election held under
4-19 or made applicable to this section;
4-20 (B) that has a population of 400,000 or more,
4-21 according to the most recent federal decennial census, and that is
4-22 located in more than one county, and in which the combined rate of
4-23 all sales and use taxes imposed by the city, the state, and other
4-24 political subdivisions of the state having territory in the city,
4-25 including taxes under this section, does not exceed 8.25 percent;
4-26 (C) that is located in a county with a
4-27 population of more than 1,100,000 according to the most recent
5-1 federal decennial census, in which there are more than 29
5-2 incorporated municipalities according to the most recent federal
5-3 decennial census, and in which the combined rate of all sales and
5-4 use taxes imposed by the city, the state, and other political
5-5 subdivisions of the state having territory in the city does not
5-6 exceed 7.75 percent on the date of any election held under or made
5-7 applicable to this section; or
5-8 (D) to which Section 4A of this Act applies.
5-9 (E) Paragraph (C) of this subdivision expires
5-10 September 1, 1999.
5-11 SECTION 4. Section 4B(k), Development Corporation Act of
5-12 1979 (Article 5190.6, Vernon's Texas Civil Statutes), is amended to
5-13 read as follows:
5-14 (k) The legislature finds for all constitutional and
5-15 statutory purposes that projects of the types added to the
5-16 definition of that term by Subsection (a) of this section are
5-17 owned, used, and held for public purposes for and on behalf of the
5-18 eligible city incorporating the corporation, and except as
5-19 otherwise provided by this subsection, Section 23(b) of this Act
5-20 and Section 25.07(a), Tax Code, are not applicable to leasehold or
5-21 other possessory interests granted by the corporation during the
5-22 period projects are owned by the corporation on behalf of the
5-23 eligible city. Projects are exempt from taxation under Section
5-24 11.11, Tax Code, for that period. For a corporation governed by
5-25 this section in which the voters of the eligible city that created
5-26 the corporation have not authorized the levy of a sales and use tax
5-27 for the benefit of the corporation under Subsection (d) of this
6-1 section, an ownership, leasehold, or other possessory interest of a
6-2 person other than the corporation in real property constituting a
6-3 project of the corporation described by this subsection is subject
6-4 to ad valorem taxation under Section 25.07(a), Tax Code, except
6-5 that an ownership, leasehold, or other possessory interest of a
6-6 person other than the corporation in real property described by
6-7 this subsection that is created under an agreement entered into by
6-8 the corporation before September 1, 1999, is covered by the
6-9 provisions of this subsection governing ad valorem taxation of the
6-10 ownership, leasehold, or other possessory interest that were in
6-11 effect on the date on which the agreement was executed.
6-12 SECTION 5. The Development Corporation Act of 1979 (Article
6-13 5190.6, Vernon's Texas Civil Statutes) is amended by adding Section
6-14 4E to read as follows:
6-15 Sec. 4E. DEVELOPMENT CORPORATION FOR SPACEPORT FACILITIES.
6-16 (a) In this section:
6-17 (1) "Eligible entity" means any county or combination
6-18 of municipalities and counties.
6-19 (2) "Project" means land, buildings, equipment,
6-20 facilities, and improvements included in the definition of that
6-21 term under Section 2 of this Act, including land, buildings,
6-22 equipment, facilities, and improvements found by the board of
6-23 directors to:
6-24 (A) be required or suitable for use for the
6-25 promotion or development of a spaceport, related area
6-26 transportation facilities, automobile parking facilities, and
6-27 related roads, streets, and water and sewer facilities, and other
7-1 related improvements that enhance any of those items;
7-2 (B) promote or develop new or expanded business
7-3 enterprises relating to a spaceport;
7-4 (C) promote or develop educational programs and
7-5 job training in connection with a spaceport;
7-6 (D) be required or suitable for the promotion of
7-7 development and expansion of affordable housing, as defined by 42
7-8 U.S.C. Section 12745, in connection with a spaceport.
7-9 (3) "Spacecraft" includes a satellite.
7-10 (4) "Spaceport" includes:
7-11 (A) an area intended to be used to launch or
7-12 land a spacecraft;
7-13 (B) a spaceport building or facility located on
7-14 an area appurtenant to a launching or landing area;
7-15 (C) an area appurtenant to a launching or
7-16 landing area that is intended for use for a spaceport building or
7-17 facility; and
7-18 (D) a right-of-way related to a launching or
7-19 landing area, building facility, or other area that is appurtenant
7-20 to a launching or landing area.
7-21 (b) An eligible entity may create a corporation under this
7-22 Act governed by this section. The corporation has the powers
7-23 granted by this section and by other sections of this Act and is
7-24 subject to the limitations of a corporation created under other
7-25 provisions of this Act. To the extent of a conflict between this
7-26 section and another provision of this Act, this section prevails.
7-27 The articles of incorporation of a corporation under this section
8-1 must state that the corporation is governed by this section and may
8-2 include within its name any words and phrases specified by the
8-3 eligible entity.
8-4 (c) A corporation may:
8-5 (1) acquire, convey, mortgage, or otherwise dispose of
8-6 property; and
8-7 (2) exercise the power of eminent domain to acquire
8-8 property for a spaceport, including the power to:
8-9 (A) acquire fee title in land condemned;
8-10 (B) relocate or modify a railroad, utility line,
8-11 pipeline, or other facility that may interfere with a spaceport; or
8-12 (C) impose a reasonable restriction on using the
8-13 surface of the property for mineral development if the corporation
8-14 does not own the mineral rights.
8-15 (d) A corporation may not issue a bond or acquire property
8-16 unless a site in the territory of the eligible entity that
8-17 established the corporation has been designated as the site for a
8-18 spaceport.
8-19 (e) Before exercising the power of eminent domain under this
8-20 section, a corporation must obtain a resolution approving the
8-21 proposed condemnation from the governing body of a county or
8-22 municipality in which the property is located. For purposes of
8-23 this section, territory in the extraterritorial jurisdiction of a
8-24 municipality is considered to be in the jurisdiction of the
8-25 municipality. The exercise of the power of eminent domain by the
8-26 corporation is governed by Chapter 21, Property Code.
8-27 (f) A corporation may make an agreement with or accept a
9-1 donation, grant, or loan from any person. A corporation may enter
9-2 into an interlocal contract under Chapter 791, Government Code. A
9-3 corporation may not contract to operate a spaceport unless the
9-4 agreement provides that the person contracting with the corporation
9-5 must assume the corporation's liability for a cause of action
9-6 arising from environmental damage. A corporation may sue and be
9-7 sued.
9-8 (g) A corporation is governed by a board of seven directors.
9-9 For a corporation established by a single county, the commissioners
9-10 court of the county shall appoint the directors. If more than one
9-11 public entity creates the corporation the board must be appointed
9-12 by written agreement between the governing bodies of those
9-13 entities. Each director serves a two-year term that expires June 1
9-14 of each odd-numbered year except that the terms of three or four of
9-15 the initial directors may be for a one-year term so that the terms
9-16 can be staggered for future two-year terms. A board shall elect a
9-17 presiding officer from among its members. A board by rule may
9-18 provide for the election of other officers. The board shall meet
9-19 at least once every three months and at the call of the presiding
9-20 officer or a majority of the directors.
9-21 (h) A board by rule may develop a plan for higher education
9-22 courses and degree programs to be offered at or near a spaceport.
9-23 These planned courses and degree programs must be related to the
9-24 purposes of this chapter. The Texas Aerospace Commission and the
9-25 Texas Higher Education Coordinating Board shall cooperate with and
9-26 advise a board in carrying out this section.
9-27 (i) A corporation may:
10-1 (1) impose a charge for using a spaceport or a service
10-2 the corporation provides;
10-3 (2) issue a bond as provided by this section;
10-4 (3) borrow money;
10-5 (4) loan money to fund a spaceport; and
10-6 (5) invest money under its control in an investment
10-7 permitted by Chapter 2256, Government Code.
10-8 (j) A corporation's property, income, and operations are
10-9 exempt from taxes imposed by the state or a political subdivision
10-10 of the state. In lieu of taxes, a corporation shall make a payment
10-11 to each political subdivision of the state in an amount equal to
10-12 the ad valorem taxes that would be paid on the land of the
10-13 corporation if the land were privately owned. Tangible personal
10-14 property such as a spacecraft or other property necessary to launch
10-15 the spacecraft is not taxable under Section 11.01, Tax Code, if it
10-16 is located in the spaceport. Chapter 151, Tax Code, does not apply
10-17 to tangible personal property purchased by a person for use in a
10-18 spaceport.
10-19 (k) A corporation may issue bonds. The bonds are not an
10-20 obligation or a pledge of the faith and credit of the state, a
10-21 sponsoring entity or other political subdivision or agency of the
10-22 state. A bond issued under this section must:
10-23 (1) be payable solely from the revenue of a spaceport
10-24 developed by the corporation issuing the bond;
10-25 (2) mature not later than 50 years after its date of
10-26 issuance;
10-27 (3) state on its face that the bond is not an
11-1 obligation of the State of Texas or a political subdivision of the
11-2 state, other than the corporation that issued the bond; and
11-3 (4) be approved by the governing body of each entity
11-4 that established the corporation.
11-5 (l) Section 24 of this Act does not apply to a corporation
11-6 under this section.
11-7 SECTION 6. The Development Corporation Act of 1979 (Article
11-8 5190.6, Vernon's Texas Civil Statutes) is amended by adding Section
11-9 30A to read as follows:
11-10 Sec. 30A. (a) For purposes of this section, a "defense base
11-11 development corporation" means a corporation established under
11-12 Section 4B of this Act, for the purpose of promoting projects
11-13 regarding a military base closure or realignment under the Defense
11-14 Base Closure and Realignment Act of 1990 (10 U.S.C. Section 2687)
11-15 and its subsequent amendments.
11-16 (b) Each of the following acts of a defense base development
11-17 corporation is validated and confirmed as of the date it occurred:
11-18 (1) each act or proceeding of the corporation taken
11-19 before March 1, 1999;
11-20 (2) the election or appointment and each act of a
11-21 director or other official of the corporation who took office
11-22 before the effective date of this Act;
11-23 (3) each act or proceeding relating to a bond or other
11-24 obligation of the corporation authorized before the effective date
11-25 of this Act; and
11-26 (4) each act or proceeding relating to the entity's
11-27 incorporation under this Act.
12-1 (c) This section does not apply to:
12-2 (1) an act, proceeding, bond, or obligation the
12-3 validity of which is the subject of litigation that is pending on
12-4 the effective date of this Act;
12-5 (2) an election or appointment of a director or
12-6 official the validity of which is the subject of litigation that is
12-7 pending on the effective date of this Act;
12-8 (3) an act or proceeding that was void or that, under
12-9 a statute of this state at the time the action or proceeding
12-10 occurred, was a misdemeanor or felony; or
12-11 (4) an act or proceeding that has been held invalid by
12-12 a final judgment of a court.
12-13 SECTION 7. This Act takes effect September 1, 1999.
12-14 SECTION 8. The importance of this legislation and the
12-15 crowded condition of the calendars in both houses create an
12-16 emergency and an imperative public necessity that the
12-17 constitutional rule requiring bills to be read on three several
12-18 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 3029 was passed by the House on May
4, 1999, by a non-record vote; that the House refused to concur in
Senate amendments to H.B. No. 3029 on May 22, 1999, and requested
the appointment of a conference committee to consider the
differences between the two houses; and that the House adopted the
conference committee report on H.B. No. 3029 on May 30, 1999, by a
non-record vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 3029 was passed by the Senate, with
amendments, on May 20, 1999, by a viva-voce vote; at the request of
the House, the Senate appointed a conference committee to consider
the differences between the two houses; and that the Senate adopted
the conference committee report on H.B. No. 3029 on May 30, 1999,
by a viva-voce vote.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor