By Duncan S.B. No. 9
76R9408 SMJ-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a franchise tax credit for corporations that provide
1-3 financing for certain before and after school programs.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 171, Tax Code, is amended by adding
1-6 Subchapter N to read as follows:
1-7 SUBCHAPTER N. TAX CREDIT FOR CONTRIBUTIONS TO
1-8 BEFORE AND AFTER SCHOOL PROGRAMS
1-9 Sec. 171.701. DEFINITION. In this subchapter, "school-age
1-10 child care" means care provided before and after school and during
1-11 the summer and holidays for children who are at least five years of
1-12 age but younger than 14 years of age.
1-13 Sec. 171.702. CREDIT. A corporation that meets the
1-14 eligibility requirements under this subchapter is entitled to a
1-15 credit in the amount allowed by this subchapter against the tax
1-16 imposed under this chapter.
1-17 Sec. 171.703. EXPENDITURES ELIGIBLE FOR CREDIT. (a) A
1-18 corporation may claim a credit under this subchapter only for a
1-19 qualifying expenditure relating to the operation of a school-age
1-20 child care program that is operated by:
1-21 (1) a nonprofit organization licensed under Chapter
1-22 42, Human Resources Code;
1-23 (2) a nonprofit, accredited educational facility or by
1-24 another nonprofit entity under contract with the educational
2-1 facility, if the Texas Education Agency or Southern Association of
2-2 Colleges and Schools has approved the curriculum content of the
2-3 program operated under the contract; or
2-4 (3) a county or municipality, if the governing body of
2-5 the county or municipality annually adopts standards of care by
2-6 order or ordinance that include minimum child-to-staff ratios,
2-7 staff qualifications, facility, health, and safety standards, and
2-8 mechanisms for monitoring and enforcing the standards.
2-9 (b) A qualifying expenditure includes an expenditure for:
2-10 (1) constructing, renovating, or remodeling a facility
2-11 or structure to be used by the program;
2-12 (2) purchasing necessary equipment, supplies, or food
2-13 to be used in the program; or
2-14 (3) operating the program, including administrative
2-15 and staff costs.
2-16 Sec. 171.704. AMOUNT; LIMITATIONS. (a) The amount of the
2-17 credit is equal to 30 percent of a corporation's qualifying
2-18 expenditures.
2-19 (b) A corporation may claim a credit under this subchapter
2-20 for a qualifying expenditure during an accounting period only
2-21 against the tax owed for the corresponding reporting period.
2-22 (c) A corporation may not claim a credit in an amount that
2-23 exceeds 50 percent of the amount of net franchise tax due, after
2-24 applying any other credits, for the reporting period.
2-25 Sec. 171.705. APPLICATION FOR CREDIT. (a) A corporation
2-26 must apply for a credit under this subchapter on or with the tax
2-27 report for the period for which the credit is claimed.
3-1 (b) The comptroller shall adopt a form for the application
3-2 for the credit. A corporation must use this form in applying for
3-3 the credit.
3-4 Sec. 171.706. ASSIGNMENT PROHIBITED. A corporation may not
3-5 convey, assign, or transfer a credit allowed under this subchapter
3-6 to another entity unless all of the assets of the corporation are
3-7 conveyed, assigned, or transferred in the same transaction.
3-8 SECTION 2. A corporation may claim the credit under
3-9 Subchapter N, Chapter 171, Tax Code, as added by this Act, only:
3-10 (1) for a qualifying expenditure made on or after the
3-11 effective date of this Act; and
3-12 (2) on a franchise tax report due under Chapter 171,
3-13 Tax Code, on or after January 1, 2000.
3-14 SECTION 3. The importance of this legislation and the
3-15 crowded condition of the calendars in both houses create an
3-16 emergency and an imperative public necessity that the
3-17 constitutional rule requiring bills to be read on three several
3-18 days in each house be suspended, and this rule is hereby suspended,
3-19 and that this Act take effect and be in force from and after its
3-20 passage, and it is so enacted.