By Counts H.B. No. 3049 Line and page numbers may not match official copy. Bill not drafted by TLC or Senate E&E. A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to certain agreements between economic development 1-3 corporations and persons engaged in certain political activities; 1-4 providing civil and criminal penalties. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. The Development Corporation Act of 1979 (Article 1-7 5190.6, Vernon's Texas Civil Statutes) is amended by adding Section 1-8 32A to read as follows: 1-9 Sec. 32A. (a) A corporation may not knowingly enter into an 1-10 agreement under which the corporation directly or indirectly 1-11 provides a benefit to a person who engages in political activities 1-12 for compensation, including a person who, in connection with a 1-13 campaign for elective office or on a measure, for compensation 1-14 provides: 1-15 (1) advice to candidates, political committees, or 1-16 organizations on political strategy, voter demographics, raising 1-17 political contributions, or the content or distribution of 1-18 political advertising; 1-19 (2) assistance in obtaining the endorsement or support 1-20 of an individual or organization; or 1-21 (3) polling. 2-1 (b) If a corporation enters into an agreement prohibited by 2-2 Subsection (a) of this section: 2-3 (1) notwithstanding Section 4B(k) or 32 of this Act or 2-4 Section 11.11, Tax Code, property owned by the corporation is not 2-5 exempt from ad valorem taxation; 2-6 (2) notwithstanding Section 151.341, Tax Code, a 2-7 taxable item sold, leased, rented to or stored, used, or consumed 2-8 by a corporation is not exempt from sales and use taxes imposed by 2-9 Chapter 151, Tax Code; and 2-10 (3) notwithstanding Section 171.074, Tax Code, the 2-11 corporation is not exempt from the franchise tax imposed under 2-12 Chapter 171, Tax Code. 2-13 (c) A person other than a corporation who enters into an 2-14 agreement prohibited by Subsection (a) of this section commits an 2-15 offense. An offense under this section is a Class A misdemeanor. 2-16 (d) A person other than a corporation who enters into an 2-17 agreement prohibited by Subsection (a) of this section and who 2-18 makes a false representation to induce the corporation to enter 2-19 into the agreement commits an offense. An offense under this 2-20 section is a Class B misdemeanor. 2-21 (e) A person other than a corporation who enters into an 2-22 agreement prohibited by Subsection (a) of this section is liable to 2-23 the state for a civil penalty not to exceed $10,000. 2-24 (f) In this section: 2-25 (1) "Benefit" has the meaning assigned by Section 3-1 1.07, Penal Code. 3-2 (2) "Measure," "political committee," and "political 3-3 contribution" have the meanings assigned by Section 251.001, 3-4 Election Code. 3-5 SECTION 2. The Development Corporation Act of 1979 (Article 3-6 5190.6, Vernon's Texas Civil Statutes) is amended by adding Section 3-7 32B to read as follows: 3-8 (a) An individual residing within the jurisdiction of an 3-9 economic development corporation created under this Act may bring a 3-10 civil action alleging a violation of Section 32A of this Act and 3-11 seeking to: 3-12 (1) enforce the terms or requirements of this Act; 3-13 (2) enforce the terms or require compliance with the 3-14 articles of incorporation or by-laws of this Act; or 3-15 (3) declare null and void any act or agreement of the 3-16 corporation that violates this Act, or the terms of the articles of 3-17 incorporation or the by-laws of the economic development 3-18 corporation. 3-19 SECTION 3. This Act takes effect September 1, 1999. 3-20 SECTION 4. Section 32A, Development Corporation Act of 1979 3-21 (Article 5190.6, Vernon's Texas Civil Statutes), as added by this 3-22 Act, applies only to an agreement between a nonprofit corporation 3-23 organized under the Development Corporation Act of 1979 (Article 3-24 5190.6, Vernon's Texas Civil Statutes) and a person who engages in 3-25 political activities for compensation that is entered on or after 4-1 September 1, 1999. 4-2 SECTION 5. The importance of this legislation and the 4-3 crowded condition of the calendars in both houses create an 4-4 emergency and an imperative public necessity that the 4-5 constitutional rule requiring bills to be read on three several 4-6 days in each house be suspended, and this rule is hereby suspended.