1-1     By:  Nixon                                            S.B. No. 1876
 1-2           (In the Senate - Filed April 20, 1999; April 21, 1999, read
 1-3     first time and referred to Committee on Intergovernmental
 1-4     Relations; April 29, 1999, reported favorably by the following
 1-5     vote:  Yeas 4, Nays 0; April 29, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the authority of certain municipalities to impose a
 1-9     sales and use tax to retire the debt of a municipal power agency
1-10     created by the municipalities.
1-11           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12           SECTION 1.  Subchapter D, Chapter 163, Utilities Code, is
1-13     amended by adding Section 163.103 to read as follows:
1-14           Sec. 163.103.  AUTHORITY TO IMPOSE SALES AND USE TAX.
1-15     (a)  Except to the extent that a provision of this section applies,
1-16     Chapter 321, Tax Code, applies to the tax authorized by this
1-17     section in the same manner as that chapter applies to the tax
1-18     authorized by that chapter.  Section 321.101(f), Tax Code, does not
1-19     apply to the tax authorized by this section.
1-20           (b)  A municipality that participates in a municipal power
1-21     agency created under this subchapter may adopt or abolish the sales
1-22     and use tax authorized by this section at an election held in the
1-23     municipality. The rate of the tax authorized by this section is
1-24     one-half percent.
1-25           (c)  The adoption or abolition of the tax takes effect on the
1-26     first day of the first calendar quarter occurring after the
1-27     expiration of the first complete calendar quarter occurring after
1-28     the date the comptroller receives a notice of the results of the
1-29     election.  If the comptroller determines that an effective date
1-30     provided by this subsection will occur before the comptroller can
1-31     reasonably take the action required to begin collecting the tax or
1-32     to implement the abolition of the tax, the effective date may be
1-33     extended by the comptroller until the first day of the next
1-34     succeeding calendar quarter.
1-35           (d)  An election to adopt or abolish the tax authorized by
1-36     this section is called by the adoption of an order by the governing
1-37     body of the municipality.  The governing body shall call an
1-38     election if a number of qualified voters of the municipality equal
1-39     to at least five percent of the number of registered voters in the
1-40     municipality petitions the governing body to call the election.
1-41           (e)  At an election to adopt the tax, the ballot shall be
1-42     prepared to permit voting for or against the proposition:  "The
1-43     adoption of a sales and use tax in _________(name of municipality)
1-44     at the rate of one-half percent to provide revenue to retire the
1-45     municipality's share of the bonded indebtedness of the ______(name
1-46     of agency) municipal power agency."
1-47           (f)  At an election to abolish the tax, the ballot shall be
1-48     prepared to permit voting for or against the proposition:  "The
1-49     abolition of the sales and use tax in _________(name of
1-50     municipality) used to retire the municipality's share of the bonded
1-51     indebtedness of the ______(name of agency) municipal power agency."
1-52           (g)  Revenue from the tax imposed under this section may be
1-53     used only to retire the municipality's share of the bonded
1-54     indebtedness, on September 1, 1999, of the municipal power agency
1-55     in which the municipality participates.  If the municipal power
1-56     agency has not determined a municipality's share of the bonded
1-57     indebtedness on or before September 1, 1999, the municipality's
1-58     share of the debt shall be determined in accordance with the ratio
1-59     that the population of the municipality bears to the total
1-60     population of all participating public entities.
1-61           (h)  A sales and use tax imposed under this section may not
1-62     be collected after the last day of the first calendar quarter
1-63     occurring after the earlier of:
1-64                 (1)  the 10th anniversary of the date the municipality
 2-1     began collecting the tax; or
 2-2                 (2)  the date the municipality notifies the comptroller
 2-3     that the municipality has abolished the tax or that the
 2-4     municipality's share of the bonded indebtedness has been paid in
 2-5     full or the full amount of money, excluding guaranteed interest,
 2-6     necessary to pay in full the municipality's share of the bonded
 2-7     indebtedness has been set aside in a trust account dedicated to the
 2-8     payment of the bonds.
 2-9           (i)  The municipality shall notify the comptroller of the
2-10     expiration of the tax not later than the 60th day before the
2-11     expiration date.
2-12           SECTION 2.  This Act takes effect September 1, 1999.
2-13           SECTION 3.  The importance of this legislation and the
2-14     crowded condition of the calendars in both houses create an
2-15     emergency and an imperative public necessity that the
2-16     constitutional rule requiring bills to be read on three several
2-17     days in each house be suspended, and this rule is hereby suspended.
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