SRC-TBR S.B. 1749 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 1749
77R7529 DAK-DBy: Haywood
Finance
4/25/2001
As Filed


DIGEST AND PURPOSE 

Currently, natural gas production in Texas is subject to a 7.5 percent tax
when it is severed from the lease upon which it is produced.  This tax is
enforced even when the natural gas is never sold and is consumed by the
owners on the property where it is produced.  As proposed, S.B. 1749
exempts "lease use fuels" from the burden of severance taxes. 

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 Section 201.053, Tax Code, to provide that the tax
imposed by this chapter does not apply to gas used on the lease for
agricultural purposes or purposes associated with agriculture, unless sold
for that purpose. 

SECTION 2. (a)  Provides that this Act takes effect on the first day of the
calendar month following the month it receives a vote of two-thirds of all
the members elected to each house, as provided by Section 39, Article III,
Texas Constitution.  Provides that if this Act does not receive the vote
necessary for that effective date, this Act takes effect September 1, 2001. 

(b)  Makes application of this Act prospective.