By: Duncan S.B. No. 269 A BILL TO BE ENTITLED AN ACT 1-1 relating to the abolishment of certain taxes imposed by and the 1-2 dissolution of certain economic development corporations. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Section 4B, Development Corporation Act of 1979 1-5 (Article 5190.6, Vernon's Texas Civil Statutes), is amended by 1-6 amending Subsection (e), as amended by Chapter 1022, Acts of the 1-7 73rd Legislature, Regular Session, 1993, and adding Subsections 1-8 (e-1) and (o) to read as follows: 1-9 (e) The rate of a tax adopted under this section must be 1-10 one-eighth, one-fourth, three-eighths, or one-half of one percent. 1-11 The ballot proposition at the election held to adopt the tax must 1-12 specify the rate of the tax to be adopted. A corporation that 1-13 holds an election to reduce or abolish a tax imposed under Section 1-14 4A of this Act may, in the same or in a separate proposition on the 1-15 same ballot, adopt a tax under this section. If an eligible city 1-16 adopts the tax, a tax is imposed on the receipts from the sale at 1-17 retail of taxable items within the eligible city at the rate 1-18 approved at the election. There is also imposed an excise tax on 1-19 the use, storage, or other consumption within the eligible city of 1-20 tangible personal property purchased, leased, or rented from a 1-21 retailer during the period that the tax is effective within the 1-22 eligible city. The rate of the excise tax is the same as the rate 1-23 of the sales tax portion of the tax and is applied to the sale 1-24 price of the tangible personal property. 2-1 (e-1) Notwithstanding any other provision of this section, 2-2 if a city dissolves a corporation created under Section 4A of this 2-3 Act and creates a corporation under this section, a person serving 2-4 as a director of the corporation created under Section 4A of this 2-5 Act at the time of dissolution may serve on the board of directors 2-6 of the corporation created under this section. 2-7 (o)(1) The governing body of a city creating a corporation 2-8 under this section shall order an election on the dissolution of 2-9 the corporation on receipt of a petition requesting the election 2-10 that is signed by at least 10 percent of the registered voters of 2-11 the city. The election must be held on the first available uniform 2-12 election date that occurs on or after the 45th day after the date 2-13 the petition is filed with the city. 2-14 (2) At the election the ballot shall be printed to 2-15 permit voting for or against the proposition: "Dissolution of the 2-16 _____________ (name of corporation)." 2-17 (3) If a majority of the votes cast are in favor of 2-18 the dissolution, the corporation shall continue operations only as 2-19 necessary to meet obligations the corporation incurred before the 2-20 date of the election, including paying the principal of and 2-21 interest on bonds. To the extent practicable, the corporation 2-22 shall liquidate assets of the corporation and apply the proceeds to 2-23 satisfy the corporation's obligations. After all of the 2-24 obligations are satisfied, any remaining assets of the corporation 2-25 shall be transferred to the city, and the corporation is dissolved. 2-26 The city shall promptly notify the comptroller and the secretary of 3-1 state of the date a corporation is dissolved under this subsection. 3-2 (4) A tax imposed under this section may not be 3-3 collected after the last day of the first calendar quarter that 3-4 begins after the city provides notice under Subdivision (3) of this 3-5 section. 3-6 (5) If less than a majority of the votes cast at the 3-7 election favor the dissolution, Subdivisions (3) and (4) of this 3-8 subsection have no effect. 3-9 SECTION 2. Subsection (o), Section 4B, Development 3-10 Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil 3-11 Statutes), as added by this Act applies only to a corporation 3-12 created on or after the effective date of this Act. A corporation 3-13 created before the effective date of this Act is governed by the 3-14 law as it existed immediately before the effective date of this 3-15 Act, and that law is continued in effect for that purpose. 3-16 SECTION 3. This Act takes effect September 1, 1999. 3-17 SECTION 4. The importance of this legislation and the 3-18 crowded condition of the calendars in both houses create an 3-19 emergency and an imperative public necessity that the 3-20 constitutional rule requiring bills to be read on three several 3-21 days in each house be suspended, and this rule is hereby suspended.