1-1 By: Goodman, Lewis of Tarrant H.B. No. 445 1-2 (Senate Sponsor - Harris) 1-3 (In the Senate - Received from the House March 21, 2001; 1-4 March 22, 2001, read first time and referred to Committee on 1-5 Intergovernmental Relations; May 7, 2001, reported adversely, with 1-6 favorable Committee Substitute by the following vote: Yeas 6, Nays 1-7 0; May 7, 2001, sent to printer.) 1-8 COMMITTEE SUBSTITUTE FOR H.B. No. 445 By: Madla 1-9 A BILL TO BE ENTITLED 1-10 AN ACT 1-11 relating to the imposition by certain municipalities of a sales and 1-12 use tax dedicated to street maintenance. 1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-14 SECTION 1. Subtitle C, Title 3, Tax Code, is amended by 1-15 adding Chapter 327 to read as follows: 1-16 CHAPTER 327. MUNICIPAL SALES AND USE TAX FOR STREET MAINTENANCE 1-17 Sec. 327.001. DEFINITION. In this chapter, "municipal 1-18 street" means the entire width of a way held by a municipality in 1-19 fee or by easement or dedication that has a part open for public 1-20 use for vehicular travel. The term does not include a designated 1-21 state or federal highway or road or a designated county road. 1-22 Sec. 327.002. MUNICIPAL SALES AND USE TAX ACT APPLICABLE. 1-23 Except to the extent that a provision of this chapter applies, 1-24 Chapter 321 applies to the tax authorized by this chapter in the 1-25 same manner as that chapter applies to the tax authorized by that 1-26 chapter. 1-27 Sec. 327.003. TAX AUTHORIZED. (a) A municipality may adopt 1-28 the sales and use tax authorized by this chapter at an election 1-29 held in the municipality. 1-30 (b) A municipality may not adopt a tax under this chapter if 1-31 as a result of the adoption of the tax the combined rate of all 1-32 sales and use taxes imposed by the municipality and other political 1-33 subdivisions of this state having territory in the municipality 1-34 would exceed two percent at any location in the municipality. 1-35 (c) If the voters of a municipality approve the adoption of 1-36 the tax at an election held on the same election date on which 1-37 another political subdivision adopts a sales and use tax or 1-38 approves the increase in the rate of its sales and use tax and as a 1-39 result the combined rate of all sales and use taxes imposed by the 1-40 municipality and other political subdivisions of this state having 1-41 territory in the municipality would exceed two percent at any 1-42 location in the municipality, the election to adopt a sales and use 1-43 tax under this chapter has no effect. 1-44 Sec. 327.004. TAX RATE. The rate of the tax authorized by 1-45 this chapter is one-fourth of one percent. 1-46 Sec. 327.005. SALES AND USE TAX EFFECTIVE DATE. (a) The 1-47 adoption of the tax takes effect on the first day of the first 1-48 calendar quarter occurring after the expiration of the first 1-49 complete calendar quarter occurring after the date on which the 1-50 comptroller receives notice of the results of the election. 1-51 (b) If the comptroller determines that an effective date 1-52 provided by Subsection (a) will occur before the comptroller can 1-53 reasonably take the action required to begin collecting the tax, 1-54 the effective date may be extended by the comptroller until the 1-55 first day of the next succeeding calendar quarter. 1-56 Sec. 327.006. ELECTION PROCEDURE. (a) An election to adopt 1-57 the tax authorized by this chapter is called by the adoption of an 1-58 ordinance by the governing body of the municipality. 1-59 (b) At an election to adopt the tax, the ballot shall be 1-60 prepared to permit voting for or against the proposition: "The 1-61 adoption of a local sales and use tax in (name of municipality) at 1-62 the rate of one-fourth of one percent to provide revenue for 1-63 maintenance and repair of municipal streets." 1-64 Sec. 327.007. REAUTHORIZATION OF TAX. (a) Unless 2-1 imposition of the sales and use tax authorized by this chapter is 2-2 reauthorized as provided by this section, the tax expires on: 2-3 (1) the fourth anniversary of the date the tax 2-4 originally took effect under Section 327.005; or 2-5 (2) the first day of the first calendar quarter 2-6 occurring after the fourth anniversary of the date the tax was last 2-7 reauthorized under this section. 2-8 (b) An election to reauthorize the tax is called and held in 2-9 the same manner as an election to adopt the tax under Section 2-10 327.006, except the ballot proposition shall be prepared to permit 2-11 voting for or against the proposition: "The reauthorization of the 2-12 local sales and use tax in (name of municipality) at the rate of 2-13 one-fourth of one percent to continue providing revenue for 2-14 maintenance and repair of municipal streets." 2-15 (c) If an election to reauthorize the tax is not held before 2-16 the tax expires as provided by Subsection (a), or if a majority of 2-17 the votes cast in an election to reauthorize the tax do not favor 2-18 reauthorization, the municipality may not call an election on the 2-19 question of authorizing a new tax under this chapter before the 2-20 first anniversary of the date on which the tax expired. 2-21 (d) Not later than the 10th day after the date the 2-22 municipality determines that the tax will expire as provided by 2-23 Subsection (a), the municipality shall notify the comptroller of 2-24 the scheduled expiration. The comptroller may delay the scheduled 2-25 expiration date if the comptroller notifies the municipality that 2-26 more time is required. The comptroller must provide a new 2-27 expiration date that is not later than the last day of the first 2-28 calendar quarter occurring after the notification to the 2-29 comptroller. 2-30 Sec. 327.008. USE OF TAX REVENUE. Revenue from the tax 2-31 imposed under this chapter may be used only to maintain and repair 2-32 municipal streets existing on the date of the election to adopt the 2-33 tax. 2-34 SECTION 2. This Act takes effect immediately if it receives 2-35 a vote of two-thirds of all the members elected to each house, as 2-36 provided by Section 39, Article III, Texas Constitution. If this 2-37 Act does not receive the vote necessary for immediate effect, this 2-38 Act takes effect September 1, 2001. 2-39 * * * * *