SRC-SEW S.B. 274 77(R)BILL ANALYSIS


Senate Research CenterS.B. 274
By: Van de Putte
Intergovernmental Relations
6/6/2001
Enrolled


DIGEST AND PURPOSE 

Currently, the Tax Increment Financing Act identifies a hospital district
as a participating taxing unit. This permits hospital ad valorem tax to be
considered as potential revenue in reinvestment zone development.  Such
zones, while well intentioned, re-direct limited health care dollars away
from medical or hospital uses.  This re-direction of revenue is not
congruent with the mission of certain hospital districts.  S.B. 274 ensures
that hospital district ad valorem taxes collected in certain counties may
be used only for medical and hospital purposes. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 281E, Health and Safety Code, by adding Section
281.095, as follows: 

Sec. 281.095.  PROHIBITION AGAINST PARTICIPATION IN TAX INCREMENT FINANCING
BY CERTAIN HOSPITAL DISTRICTS.  (a) Defines "district." 

(b) Prohibits the district from entering into a contract or agreement to
pay into a tax increment fund any of the district's tax increment produced
from property located in a reinvestment zone under Chapter 311(Tax
Increment Financing Act), Tax Code. Provides that this subsection does not
affect the validity of an agreement entered into by the district before
September 1, 2001, to pay a portion of the district's tax increment into a
tax increment fund under Chapter 311, Tax Code.   

(c) Prohibits the proceeds of a tax imposed under Section 281.121 from
being used to make a payment into a tax increment fund under Chapter 311,
Tax Code, if that payment is prohibited by this section. 

(d) Prohibits a project plan or reinvestment zone financing plan approved
under Section 311.011, Tax Code, on or after September 1, 2001, from
including any of the district's tax increment or any other funds derived
from the district as a source of revenue to finance or pay project costs. 

(e) Prohibits a project plan or reinvestment zone financing plan approved
under Section 311.011, Tax Code, before September 1, 2001, from being
amended on or after September 1, 2001, for certain stated purposes. 

(f) Prohibits an agreement entered into by the district under Section
311.013(f), Tax Code, before September 1, 2001, from being amended on or
after September 1, 2001, to include any of the conditions prohibited by
Subsection (e) 
 
SECTION 2.  Effective date:  September 1, 2001.