1-1     By:  Nixon                                             S.B. No. 182
 1-2           (In the Senate - Filed January 19, 1999; January 28, 1999,
 1-3     read first time and referred to Committee on Finance; May 12, 1999,
 1-4     reported adversely, with favorable Committee Substitute by the
 1-5     following vote:  Yeas 10, Nays 0; May 12, 1999, sent to printer.)
 1-6     COMMITTEE SUBSTITUTE FOR S.B. No. 182                 By:  Moncrief
 1-7                            A BILL TO BE ENTITLED
 1-8                                   AN ACT
 1-9     relating to the appraisal of certain leaseholds for tax purposes.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Section 23.13, Tax Code, is amended to read as
1-12     follows:
1-13           Sec. 23.13.  TAXABLE LEASEHOLDS.  (a)  A taxable leasehold or
1-14     other possessory interest in real property that is exempt from
1-15     taxation to the owner of the estate or interest encumbered by the
1-16     possessory interest is appraised at the market value of the
1-17     leasehold or other possessory interest.  Subject to the limitations
1-18     provided by Subsection (b), when appraising the leasehold or other
1-19     possessory interest in real property that is otherwise tax exempt,
1-20     the appraiser shall apply generally accepted appraisal methods and
1-21     techniques to value the leasehold advantage or "equity".
1-22           (b)  The taxable [However, the appraised] value may not be
1-23     less than the total rental paid for the interest for the current
1-24     tax year.  However, the taxable value may not be greater than 10
1-25     times the leasehold rent advantage (the positive result of market
1-26     rent minus contract rent).
1-27           SECTION 2.  This Act takes effect September 1, 1999.
1-28           SECTION 3.  The importance of this legislation and the
1-29     crowded condition of the calendars in both houses create an
1-30     emergency and an imperative public necessity that the
1-31     constitutional rule requiring bills to be read on three several
1-32     days in each house be suspended, and this rule is hereby suspended.
1-33                                  * * * * *