HBA-SEP H.B. 1390 77(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 1390
By: Najera
Economic Development
7/9/2001
Enrolled



BACKGROUND AND PURPOSE 

In 1989, to encourage business development, the legislature modified the
Development Corporation Act of 1979 to authorize cities in counties with a
population of 500,000 or fewer to adopt up to a one-half percent sales tax
on local retail sales to support local economic development projects.  The
following session, the legislature again modified the Act to authorize
cities in counties with a population of 750,000 or more to assess the same
one-half percent sales tax. Prior to the 77th Legislature, El Paso,
Hidalgo, and Travis counties, each with a population between 500,000 and
750,000, were prevented from utilizing this economic development tool.
House Bill 1390 lowers the population requirement for an "eligible city"
where the combined rate of sales and use taxes does not exceed 8.25 percent
to include a city located in a county with a population of 500,000 or more. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 1390 amends the Development Corporation Act of 1979 to lower,
from 750,000 or more to 500,000 or more, the county population requirement
for an "eligible city" in which the combined rate of sales and use taxes
does not exceed 8.25 percent. 

EFFECTIVE DATE

May 23, 2001.