77R13527 E
By Brimer, Oliveira, Swinford, McCall, H.B. No. 1200
Telford, et al.
Substitute the following for H.B. No. 1200:
By Oliveira C.S.H.B. No. 1200
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the enactment of the Texas Economic Development Act,
1-3 authorizing certain ad valorem tax incentives for economic
1-4 development, including authorizing school districts to provide tax
1-5 relief for certain corporations and limited liability companies
1-6 that make large investments that create jobs in this state, to
1-7 authorizing the imposition of certain impact fees, and to
1-8 continuing the Property Redevelopment and Tax Abatement Act.
1-9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10 SECTION 1. Subtitle B, Title 3, Tax Code, is amended by
1-11 adding Chapter 313 to read as follows:
1-12 CHAPTER 313. TEXAS ECONOMIC DEVELOPMENT ACT
1-13 SUBCHAPTER A. GENERAL PROVISIONS
1-14 Sec. 313.001. SHORT TITLE. This chapter may be cited as the
1-15 Texas Economic Development Act.
1-16 Sec. 313.002. FINDINGS. The legislature finds that:
1-17 (1) many states have enacted aggressive economic
1-18 development laws designed to attract large employers, create jobs,
1-19 and strengthen their economies;
1-20 (2) the State of Texas has slipped in its national
1-21 ranking each year between 1993 and 2000 in terms of attracting
1-22 major new manufacturing facilities to this state;
1-23 (3) a significant portion of the Texas economy
1-24 continues to be based in the manufacturing industry, and the
2-1 continued growth and overall health of the manufacturing sector
2-2 serves the Texas economy well;
2-3 (4) without a vibrant, strong manufacturing sector,
2-4 other sectors of the economy, especially the state's service
2-5 sector, will also suffer adverse consequences; and
2-6 (5) the current property tax system of this state does
2-7 not favor capital-intensive businesses such as manufacturers.
2-8 Sec. 313.003. PURPOSES. The purposes of this chapter are
2-9 to:
2-10 (1) encourage large-scale capital investments in this
2-11 state, especially in school districts that have an ad valorem tax
2-12 base that is less than the statewide average ad valorem tax base of
2-13 school districts in this state;
2-14 (2) create new, high-paying jobs in this state;
2-15 (3) attract to this state new, large-scale businesses
2-16 that are exploring opportunities to locate in other states or other
2-17 countries;
2-18 (4) enable local government officials and economic
2-19 development professionals to compete with other states by
2-20 authorizing economic development incentives that meet or exceed
2-21 incentives being offered to prospective employers by other states
2-22 and to provide local officials with an effective means to attract
2-23 large-scale investment;
2-24 (5) strengthen and improve the overall performance of
2-25 the economy of this state;
2-26 (6) expand and enlarge the ad valorem property tax
2-27 base of this state; and
3-1 (7) enhance this state's economic development efforts
3-2 by providing school districts with an effective local economic
3-3 development option.
3-4 Sec. 313.004. LEGISLATIVE INTENT. It is the intent of the
3-5 legislature in enacting this chapter that:
3-6 (1) economic development decisions should occur at the
3-7 local level and be consistent with identifiable statewide economic
3-8 development goals;
3-9 (2) this chapter should not be construed or
3-10 interpreted to allow:
3-11 (A) property owners to pool investments to
3-12 create sufficiently large investments to qualify for an ad valorem
3-13 tax benefit or financial benefit provided by this chapter;
3-14 (B) an applicant for an ad valorem tax benefit
3-15 or financial benefit provided by this chapter to assert that jobs
3-16 will be eliminated if certain investments are not made if the
3-17 assertion is not true; or
3-18 (C) a sole proprietorship, partnership, or
3-19 limited liability partnership to receive an ad valorem tax benefit
3-20 or financial benefit provided by this chapter; and
3-21 (3) in implementing this chapter, school districts
3-22 should:
3-23 (A) strictly interpret the criteria and
3-24 selection guidelines provided by this chapter; and
3-25 (B) approve only those applications for an ad
3-26 valorem tax benefit or financial benefit provided by this chapter
3-27 that:
4-1 (i) enhance the local community;
4-2 (ii) improve the local public education
4-3 system;
4-4 (iii) create high-paying jobs; and
4-5 (iv) advance the economic development
4-6 goals of this state as identified by the Texas Strategic Economic
4-7 Development Planning Commission.
4-8 Sec. 313.005. DEFINITIONS. Unless this chapter defines a
4-9 word or phrase used in this chapter, Section 1.04 or any other
4-10 section of Title 1 or this title that defines the word or phrase or
4-11 ascribes a meaning to the word or phrase applies to the word or
4-12 phrase used in this chapter.
4-13 Sec. 313.006. IMPOSITION OF IMPACT FEE. (a) In this
4-14 section, "impact fee" means a charge or assessment imposed against
4-15 new development in order to generate revenue for funding or
4-16 recouping the costs of capital improvements or facility expansions
4-17 necessitated by or attributable to property subject to a limitation
4-18 on appraised value under this chapter.
4-19 (b) Notwithstanding any other law, including Chapter 395,
4-20 Local Government Code, a municipality or county may impose and
4-21 collect a reasonable impact fee under this section to pay for the
4-22 cost of providing improvements associated with or attributable to
4-23 property that is subject to a limitation on appraised value under
4-24 this chapter.
4-25 Sec. 313.007. EXPIRATION. Subchapters B, C, and D expire
4-26 December 31, 2007.
4-27 (Sections 313.008-313.020 reserved for expansion)
5-1 SUBCHAPTER B. LIMITATION ON APPRAISED VALUE OF CERTAIN
5-2 PROPERTY USED TO CREATE JOBS
5-3 Sec. 313.021. DEFINITIONS. In this subchapter:
5-4 (1) "Qualified investment" means:
5-5 (A) tangible personal property that is first
5-6 placed in service in this state during the applicable qualifying
5-7 time period that begins on or after January 1, 2002, and is
5-8 described as Section 1245 property by Section 1245(a), Internal
5-9 Revenue Code of 1986;
5-10 (B) tangible personal property that is first
5-11 placed in service in this state during the applicable qualifying
5-12 time period that begins on or after January 1, 2002, without regard
5-13 to whether the property is affixed to or incorporated into real
5-14 property, and that is used in connection with the manufacturing,
5-15 processing, or fabrication in a cleanroom environment of a
5-16 semiconductor product, without regard to whether the property is
5-17 actually located in the cleanroom environment, including:
5-18 (i) integrated systems, fixtures, and
5-19 piping;
5-20 (ii) all property necessary or adapted to
5-21 reduce contamination or to control airflow, temperature, humidity,
5-22 chemical purity, or other environmental conditions or manufacturing
5-23 tolerances; and
5-24 (iii) production equipment and machinery,
5-25 moveable cleanroom partitions, and cleanroom lighting; or
5-26 (C) a building or a permanent, nonremovable
5-27 component of a building that is built or constructed during the
6-1 applicable qualifying time period that begins on or after January
6-2 1, 2002, and that houses tangible personal property described by
6-3 Paragraph (A) or (B).
6-4 (2) "Qualified property" means:
6-5 (A) land:
6-6 (i) that is located in an area designated
6-7 as a reinvestment zone under Chapter 311 or 312 or as an enterprise
6-8 zone under Chapter 2303, Government Code;
6-9 (ii) on which a person proposes to
6-10 construct a new building or erect or affix a new improvement that
6-11 does not exist before the date the owner applies for a limitation
6-12 on appraised value under this subchapter;
6-13 (iii) that is not subject to a tax
6-14 abatement agreement entered into by a school district under Chapter
6-15 312; and
6-16 (iv) on which, in connection with the new
6-17 building or new improvement described by Subparagraph (ii), the
6-18 owner of the land proposes to:
6-19 (a) make a qualified investment in
6-20 an amount equal to at least the minimum amount required by Section
6-21 313.023; and
6-22 (b) create at least 25 qualifying
6-23 jobs;
6-24 (B) the new building or other new improvement
6-25 described by Paragraph (A)(ii); and
6-26 (C) tangible personal property that:
6-27 (i) is not subject to a tax abatement
7-1 agreement entered into by a school district under Chapter 312; and
7-2 (ii) except for equipment described in
7-3 Section 151.318(q), is first placed in service in the new building
7-4 or in or on the new improvement described by Paragraph (A)(ii), or
7-5 on the land on which that new building or new improvement is
7-6 located, if the personal property is ancillary and necessary to the
7-7 business conducted in that new building or in or on that new
7-8 improvement.
7-9 (3) "Qualifying job" means a permanent full-time job
7-10 that:
7-11 (A) requires at least 1,600 hours of work a
7-12 year;
7-13 (B) is not transferred from one area in this
7-14 state to another area in this state;
7-15 (C) is not created to replace a previous
7-16 employee; and
7-17 (D) is covered by a group health benefit plan,
7-18 as defined by Section 481.151, Government Code, for which the
7-19 business offers to pay at least 50 percent of the premiums or other
7-20 charges assessed for employee-only coverage under the plan,
7-21 regardless of whether an employee may voluntarily waive the
7-22 coverage.
7-23 (4) "Qualifying time period" means the first two tax
7-24 years that begin on or after the date a person's application for a
7-25 limitation on appraised value under this subchapter is approved.
7-26 Sec. 313.022. APPLICABILITY; CATEGORIZATION OF SCHOOL
7-27 DISTRICTS. (a) This subchapter applies to each school district in
8-1 this state other than a school district to which Subchapter C
8-2 applies.
8-3 (b) For purposes of determining the required minimum amount
8-4 of a qualified investment under Section 313.021(2)(A)(iv)(a), and
8-5 the minimum amount of a limitation on appraised value under Section
8-6 313.027(b), school districts to which this subchapter applies are
8-7 categorized according to the taxable value of property in the
8-8 district for the preceding tax year determined under Subchapter M,
8-9 Chapter 403, Government Code, as follows:
8-10 CATEGORY TAXABLE VALUE OF PROPERTY
8-11 I $10 billion or more
8-12 II $1 billion or more but less than $10 billion
8-13 III $500 million or more but less than $1 billion
8-14 IV $100 million or more but less than $500 million
8-15 V less than $100 million
8-16 Sec. 313.023. MINIMUM AMOUNTS OF QUALIFIED INVESTMENT. For
8-17 each category of school district established by Section 313.022,
8-18 the minimum amount of a qualified investment under Section
8-19 313.021(2)(A)(iv)(a) is as follows:
8-20 CATEGORY MINIMUM QUALIFIED INVESTMENT
8-21 I $100 million
8-22 II $80 million
8-23 III $60 million
8-24 IV $40 million
8-25 V $20 million
8-26 Sec. 313.024. ELIGIBLE PROPERTY. (a) This subchapter and
8-27 Subchapters C and D apply only to property owned by a corporation
9-1 or limited liability company to which Section 171.001 applies.
9-2 (b) To be eligible for a limitation on appraised value under
9-3 this subchapter, the corporation or limited liability company must
9-4 use the property in connection with:
9-5 (1) manufacturing; or
9-6 (2) research and development.
9-7 (c) For purposes of determining an applicant's eligibility
9-8 for a limitation under this subchapter:
9-9 (1) the land on which a building or component of a
9-10 building described by Section 313.021(1)(C) is located is not
9-11 considered a qualified investment;
9-12 (2) property that is leased under a capitalized lease
9-13 may be considered a qualified investment;
9-14 (3) property that is leased under an operating lease
9-15 may not be considered a qualified investment; and
9-16 (4) property that is owned by a person other than the
9-17 applicant and that is pooled or proposed to be pooled with property
9-18 owned by the applicant may not be included in determining the
9-19 amount of the applicant's qualifying investment.
9-20 (d) In this section, "manufacturing" and "research and
9-21 development" have the meanings assigned by Section 171.751.
9-22 Sec. 313.025. APPLICATION; ACTION ON APPLICATION. (a) The
9-23 owner of qualified property may apply to the governing body of the
9-24 school district in which the property is located for a limitation
9-25 on the appraised value for school district maintenance and
9-26 operations ad valorem tax purposes of the person's qualified
9-27 property. An application must be made on the form prescribed by
10-1 the comptroller and include the information required by the
10-2 comptroller, and it must be accompanied by:
10-3 (1) the application fee established by the governing
10-4 body of the school district;
10-5 (2) information sufficient to show that the real and
10-6 personal property identified in the application as qualified
10-7 property meets the applicable criteria established by Section
10-8 313.021(2); and
10-9 (3) information relating to each applicable criterion
10-10 listed in Section 313.026.
10-11 (b) The governing body of a school district is not required
10-12 to consider an application for a limitation on appraised value that
10-13 is filed with the governing body under Subsection (a). If the
10-14 governing body of the school district does elect to consider an
10-15 application, the governing body shall engage a third person to
10-16 conduct an economic impact evaluation of the application on behalf
10-17 of the school district and approve or disapprove an application
10-18 before the 121st day after the date the application is filed,
10-19 unless an extension is agreed to by the governing body and the
10-20 applicant.
10-21 (c) In determining whether to grant an application, the
10-22 governing body of the school district is entitled to request and
10-23 receive assistance from:
10-24 (1) the comptroller;
10-25 (2) the Texas Department of Economic Development;
10-26 (3) the Council on Workforce and Economic
10-27 Competitiveness; and
11-1 (4) the Texas Workforce Commission.
11-2 (d) On receipt of an application under this section that the
11-3 governing body elects to consider, the school district shall
11-4 deliver one copy of the application to the comptroller. Before the
11-5 61st day after the date the copy of the application is received,
11-6 the comptroller, using the criteria listed in Section 313.026,
11-7 shall submit a recommendation to the governing body of the school
11-8 district as to whether the application should be approved or
11-9 disapproved.
11-10 (e) Before approving or disapproving an application under
11-11 this subchapter that the governing body elects to consider, the
11-12 governing body of the school district must make a written finding
11-13 as to each criterion listed in Section 313.026. The governing body
11-14 shall deliver a copy of those findings to the applicant.
11-15 (f) The governing body may approve an application only if
11-16 the governing body finds that the information in the application is
11-17 true and correct, finds that the applicant is eligible for the
11-18 limitation on the appraised value of the person's qualified
11-19 property, and determines that granting the application is in the
11-20 best interest of the school district and this state.
11-21 Sec. 313.026. ECONOMIC IMPACT EVALUATION. The economic
11-22 impact evaluation of the application must include the following:
11-23 (1) the recommendations of the comptroller;
11-24 (2) the relationship between the applicant's industry
11-25 and the types of qualifying jobs to be created by the applicant to
11-26 the long-term economic growth plans of this state as described in
11-27 the strategic plan for economic development submitted by the Texas
12-1 Strategic Economic Development Planning Commission under Section
12-2 481.033, Government Code, as that section existed before February
12-3 1, 1999;
12-4 (3) the relative level of the applicant's investment
12-5 per qualifying job to be created by the applicant;
12-6 (4) the wages, salaries, and benefits to be offered by
12-7 the applicant to qualifying job holders;
12-8 (5) the ability of the applicant to locate or relocate
12-9 in another state or another region of this state;
12-10 (6) the impact the added infrastructure will have on
12-11 the region, including:
12-12 (A) revenue gains that would be realized by the
12-13 school district; and
12-14 (B) subsequent economic effects on the local and
12-15 regional tax bases;
12-16 (7) the economic condition of the region of the state
12-17 at the time the person's application is being considered;
12-18 (8) the number of new facilities built or expanded in
12-19 the region during the two years preceding the date of the
12-20 application that were eligible to apply for a limitation on
12-21 appraised value under this subchapter; and
12-22 (9) the effect of the applicant's proposal, if
12-23 approved, on the number or size of the school district's
12-24 instructional facilities, as defined by Section 46.001, Education
12-25 Code.
12-26 Sec. 313.027. LIMITATION ON APPRAISED VALUE; AGREEMENT. (a)
12-27 If the person's application is approved by the governing body of
13-1 the school district, for each of the first eight tax years that
13-2 begin after the applicable qualifying time period, the appraised
13-3 value for school district maintenance and operations ad valorem tax
13-4 purposes of the person's qualified property as described in the
13-5 agreement between the person and the district entered into under
13-6 this section in the school district may not exceed the lesser of:
13-7 (1) the market value of the property; or
13-8 (2) subject to Subsection (b), the amount agreed to by
13-9 the governing body of the school district.
13-10 (b) The amount agreed to by the governing body of a school
13-11 district under Subsection (a)(2) must be an amount in accordance
13-12 with the following, according to the category established by
13-13 Section 313.022 to which the school district belongs:
13-14 CATEGORY MINIMUM AMOUNT OF LIMITATION
13-15 I $100 million
13-16 II $80 million
13-17 III $60 million
13-18 IV $40 million
13-19 V $20 million
13-20 (c) The limitation amounts listed in Subsection (b) are
13-21 minimum amounts. A school district, regardless of category, may
13-22 agree to a greater amount than those amounts.
13-23 (d) The governing body of the school district and the
13-24 property owner shall enter into a written agreement for the
13-25 implementation of the limitation on appraised value under this
13-26 subchapter on the owner's qualified property.
13-27 (e) The agreement must describe with specificity the
14-1 qualified investment that the person will make on or in connection
14-2 with the person's qualified property that is subject to the
14-3 limitation on appraised value under this subchapter. Other
14-4 property of the person that is not specifically described in the
14-5 agreement is not subject to the limitation unless the governing
14-6 body of the school district, by official action, provides that the
14-7 other property is subject to the limitation.
14-8 (f) In addition, the agreement:
14-9 (1) must incorporate each relevant provision of this
14-10 subchapter and, to the extent necessary, include provisions for the
14-11 protection of future school district revenues through the
14-12 adjustment of the minimum valuations, the payment of revenue
14-13 offsets, and other mechanisms agreed to by the property owner and
14-14 the school district;
14-15 (2) must require the property owner to maintain a
14-16 viable presence in the school district for at least three years
14-17 after the date the limitation on appraised value of the owner's
14-18 property expires;
14-19 (3) must provide for the termination of the agreement,
14-20 the recapture of ad valorem tax revenue lost as a result of the
14-21 agreement if the owner of the property fails to comply with the
14-22 terms of the agreement, and payment of a penalty or interest, or
14-23 both, on that recaptured ad valorem tax revenue;
14-24 (4) may specify any conditions the occurrence of which
14-25 will require the district and the property owner to renegotiate all
14-26 or any part of the agreement; and
14-27 (5) must specify the ad valorem tax years covered by
15-1 the agreement.
15-2 (g) When appraising a person's qualified property subject to
15-3 a limitation on appraised value under this section, the chief
15-4 appraiser shall determine the market value of the property and
15-5 include both the market value and the appropriate value under
15-6 Subsection (a) in the appraisal records.
15-7 Sec. 313.028. CERTAIN BUSINESS INFORMATION CONFIDENTIAL.
15-8 Information provided to a school district in connection with an
15-9 application for a limitation on appraised value under this
15-10 subchapter that describes the specific processes or business
15-11 activities to be conducted or the specific tangible personal
15-12 property to be located on real property covered by the application
15-13 is confidential and not subject to public disclosure unless the
15-14 governing body of the school district approves the application.
15-15 Information in the custody of a school district if the governing
15-16 body approves the application is not confidential under this
15-17 section.
15-18 Sec. 313.029. TAX RATE LIMITATION. If the governing body of
15-19 a school district grants an application for a limitation on
15-20 appraised value under this subchapter, for each of the first two
15-21 tax years that begins after the date the application is approved,
15-22 the governing body of the school district may not adopt a tax rate
15-23 that exceeds the school district's rollback tax rate under Section
15-24 26.08 for that year. If, in any tax year in which a restriction on
15-25 the school district's tax rate under this section is in effect, the
15-26 governing body approves a subsequent application for a limitation
15-27 on appraised value under this section, the restriction on the
16-1 school district's tax rate is extended until the first tax year
16-2 that begins after the second anniversary of the date the subsequent
16-3 application is approved.
16-4 Sec. 313.030. PROPERTY NOT ELIGIBLE FOR TAX ABATEMENT.
16-5 Property subject to a limitation on appraised value in a tax year
16-6 under this subchapter is not eligible for tax abatement by a school
16-7 district under Chapter 312 in that tax year.
16-8 Sec. 313.031. RULES AND FORMS; FEES. (a) The comptroller
16-9 shall:
16-10 (1) adopt rules and forms necessary for the
16-11 implementation and administration of this chapter, including rules
16-12 for determining whether a property owner's property qualifies as a
16-13 qualified investment under Section 313.021(1); and
16-14 (2) provide without charge one copy of the rules and
16-15 forms to any school district and to any person who states that the
16-16 person intends to apply for a limitation on appraised value under
16-17 this subchapter or a tax credit under Subchapter D.
16-18 (b) The governing body of a school district by official
16-19 action shall establish reasonable nonrefundable application fees to
16-20 be paid by property owners who apply to the district for a
16-21 limitation on the appraised value of the person's property under
16-22 this subchapter. The amount of an application fee must be
16-23 reasonable and may not exceed the estimated cost to the district of
16-24 processing and acting on an application, including the cost of the
16-25 economic impact evaluation required by Sections 313.025 and
16-26 313.026.
16-27 (Sections 313.032-313.050 reserved for expansion
17-1 SUBCHAPTER C. LIMITATION ON APPRAISED VALUE OF PROPERTY
17-2 IN CERTAIN RURAL SCHOOL DISTRICTS
17-3 Sec. 313.051. APPLICABILITY. (a) This subchapter applies
17-4 only to a school district that has territory in a county located:
17-5 (1) north of the southern boundaries of Andrews,
17-6 Martin, Howard, Mitchell, Nolan, and Taylor counties; and
17-7 (2) west of the eastern boundaries of Hardeman, Foard,
17-8 Knox, Haskell, Jones, and Taylor counties.
17-9 (b) The governing body of a school district to which this
17-10 subchapter applies may enter into an agreement in the same manner
17-11 as a school district to which Subchapter B applies may do so under
17-12 Subchapter B, subject to Sections 313.052-313.054. Except as
17-13 otherwise provided by this subchapter, the provisions of Subchapter
17-14 B apply to a school district to which this subchapter applies. In
17-15 this subchapter, "qualified property" means land on which the owner
17-16 of the land proposes to create at least 10 qualifying jobs.
17-17 Sec. 313.052. CATEGORIZATION OF SCHOOL DISTRICTS. For
17-18 purposes of determining the required minimum amount of a qualified
17-19 investment under Section 313.021(2)(A)(iv)(a) and the minimum
17-20 amount of a limitation on appraised value under this subchapter,
17-21 school districts to which this subchapter applies are categorized
17-22 according to the taxable value of industrial property in the
17-23 district for the preceding tax year determined under Subchapter M,
17-24 Chapter 403, Government Code, as follows:
17-25 CATEGORY TAXABLE VALUE OF INDUSTRIAL PROPERTY
17-26 I $200 million or more
17-27 II $90 million or more but less than $200 million
18-1 III $1 million or more but less than $90 million
18-2 IV $100,000 or more but less than $1 million
18-3 V less than $100,000
18-4 Sec. 313.053. MINIMUM AMOUNTS OF QUALIFIED INVESTMENT. For
18-5 each category of school district established by Section 313.052,
18-6 the minimum amount of a qualified investment under Section
18-7 313.021(2)(A)(iv)(a) is as follows:
18-8 CATEGORY MINIMUM QUALIFIED INVESTMENT
18-9 I $30 million
18-10 II $20 million
18-11 III $10 million
18-12 IV $5 million
18-13 V $1 million
18-14 Sec. 313.054. LIMITATION ON APPRAISED VALUE. (a) For a
18-15 school district to which this subchapter applies, the amount agreed
18-16 to by the governing body of the district under Section
18-17 313.027(a)(2) must be an amount in accordance with the following,
18-18 according to the category established by Section 313.052 to which
18-19 the school district belongs:
18-20 CATEGORY MINIMUM AMOUNT OF LIMITATION
18-21 I $30 million
18-22 II $20 million
18-23 III $10 million
18-24 IV $5 million
18-25 V $1 million
18-26 (b) The limitation amounts listed in Subsection (a) are
18-27 minimum amounts. A school district, regardless of category, may
19-1 agree to a greater amount than those amounts.
19-2 (Sections 313.055-313.100 reserved for expansion
19-3 SUBCHAPTER D. SCHOOL TAX CREDITS
19-4 Sec. 313.101. DEFINITION. In this subchapter, "qualifying
19-5 time period" has the meaning assigned by Section 313.021.
19-6 Sec. 313.102. ELIGIBILITY FOR TAX CREDIT; AMOUNT OF CREDIT.
19-7 (a) In addition to the limitation on the appraised value of the
19-8 person's qualified property under Subchapter B or C, a person is
19-9 entitled to a tax credit from the school district that approved the
19-10 limitation in an amount equal to the amount of ad valorem taxes
19-11 paid to that school district that were imposed on the portion of
19-12 the appraised value of the qualified property that exceeds the
19-13 amount of the limitation agreed to by the governing body of the
19-14 school district under Section 313.027(a)(2) in each year in the
19-15 applicable qualifying time period.
19-16 (b) If the person relocates the person's business outside
19-17 the school district, the person is not entitled to the credit in or
19-18 after the year in which the relocation occurs.
19-19 Sec. 313.103. APPLICATION. An application for a tax credit
19-20 under this subchapter must be made to the governing body of the
19-21 school district to which the ad valorem taxes were paid. The
19-22 application must be:
19-23 (1) made on the form prescribed for that purpose by
19-24 the comptroller and verified by the applicant;
19-25 (2) accompanied by:
19-26 (A) a tax receipt from the collector of taxes
19-27 for the school district showing full payment of school district ad
20-1 valorem taxes on the qualified property for the applicable
20-2 qualifying time period; and
20-3 (B) any other document or information that the
20-4 comptroller or the governing body considers necessary for a
20-5 determination of the applicant's eligibility for the credit or the
20-6 amount of the credit; and
20-7 (3) filed before September 1 of the year immediately
20-8 following the applicable qualifying time period.
20-9 Sec. 313.104. ACTION ON APPLICATION; GRANT OF CREDIT.
20-10 Before the 90th day after the date the application for a tax credit
20-11 is filed, the governing body of the school district shall:
20-12 (1) determine the person's eligibility for a tax
20-13 credit under this subchapter; and
20-14 (2) if the person's application is approved, by order
20-15 or resolution direct the collector of taxes for the school
20-16 district:
20-17 (A) in each of the first eight tax years that
20-18 begin after the date the application is approved, to credit against
20-19 the taxes imposed on the qualified property by the district in that
20-20 year an amount equal to one-eighth of the total amount of tax
20-21 credit to which the person is entitled under Section 313.102,
20-22 except that the amount of a credit granted in any of those tax
20-23 years may not exceed 50 percent of the total amount of ad valorem
20-24 school taxes imposed on the qualified property by the school
20-25 district in that tax year; and
20-26 (B) in the first tax year that begins on or
20-27 after the date the person's eligibility for the limitation under
21-1 Subchapter B or C expires, to credit against the taxes imposed on
21-2 the qualified property by the district an amount equal to the
21-3 portion of the total amount of tax credit to which the person is
21-4 entitled under Section 313.102 that was not credited against the
21-5 person's taxes under Paragraph (A) in a tax year covered by
21-6 Paragraph (A), except that the amount of a tax credit granted under
21-7 this paragraph in any tax year may not exceed the total amount of
21-8 ad valorem school taxes imposed on the qualified property by the
21-9 school district in that tax year.
21-10 Sec. 313.105. REMEDY FOR ERRONEOUS CREDIT. (a) If the
21-11 comptroller and the governing body of a school district determine
21-12 that a person who received a tax credit under this subchapter for
21-13 any reason was not entitled to the credit received or was entitled
21-14 to a lesser amount of credit than the amount of the credit
21-15 received, an additional tax is imposed on the qualified property
21-16 equal to the full credit or the amount of the credit to which the
21-17 person was not entitled, as applicable, plus interest at an annual
21-18 rate of seven percent calculated from the date the credit was
21-19 issued.
21-20 (b) A tax lien attaches to the qualified property in favor
21-21 of the school district to secure payment by the person of the
21-22 additional tax and interest imposed by this section and any
21-23 penalties incurred. A person delinquent in the payment of an
21-24 additional tax under this section may not submit a subsequent
21-25 application or receive a tax credit under this subchapter in a
21-26 subsequent year.
21-27 (Sections 313.106-313.170 reserved for expansion
22-1 SUBCHAPTER E. AVAILABILITY OF TAX CREDIT AFTER PROGRAM
22-2 EXPIRES
22-3 Sec. 313.171. SAVING PROVISIONS. (a) A limitation on
22-4 appraised value approved under Subchapter B or C before the
22-5 expiration of that subchapter continues in effect according to that
22-6 subchapter as that subchapter existed immediately before its
22-7 expiration, and that law is continued in effect for purposes of the
22-8 limitation on appraised value.
22-9 (b) The expiration of Subchapter D does not affect a
22-10 property owner's entitlement to a tax credit granted under
22-11 Subchapter D if the property owner qualified for the tax credit
22-12 before the expiration of Subchapter D.
22-13 SECTION 2. Subchapter A, Chapter 23, Tax Code, is amended by
22-14 adding Section 23.03 to read as follows:
22-15 Sec. 23.03. COMPILATION OF LARGE PROPERTIES. (a) Each year
22-16 the chief appraiser shall compile and send to the Texas Department
22-17 of Economic Development a list of properties in the appraisal
22-18 district that have a market value of $100 million or more in that
22-19 tax year.
22-20 (b) Each year, the Texas Department of Economic Development
22-21 shall:
22-22 (1) compile a list of all properties reported to the
22-23 department under Subsection (a); and
22-24 (2) deliver a copy of the list to each member of the
22-25 legislature.
22-26 SECTION 3. Section 26.012(6), Tax Code, is amended to read as
22-27 follows:
23-1 (6) "Current total value" means the total taxable
23-2 value of property listed on the appraisal roll for the current
23-3 year, including all appraisal roll supplements and corrections as
23-4 of the date of the calculation, less the taxable value of property
23-5 exempted for the current tax year for the first time under Section
23-6 11.31, except that the current total value for a school district
23-7 excludes:
23-8 (A) the total value of homesteads that qualify
23-9 for a tax limitation as provided by Section 11.26; and
23-10 (B) new property value of property that is
23-11 subject to an agreement entered into under Chapter 313.
23-12 SECTION 4. Subchapter A, Chapter 312, Tax Code, is amended by
23-13 adding Section 312.0025 to read as follows:
23-14 Sec. 312.0025. DESIGNATION OF REINVESTMENT ZONE BY SCHOOL
23-15 DISTRICT. (a) Notwithstanding any other provision of this chapter
23-16 to the contrary, the governing body of a school district, in the
23-17 manner required for official action and for purposes of Subchapter
23-18 B or C, Chapter 313, may designate an area entirely within the
23-19 territory of the school district as a reinvestment zone if the
23-20 governing body finds that, as a result of the designation and the
23-21 granting of a limitation on appraised value under Subchapter B or
23-22 C, Chapter 313, for property located in the reinvestment zone, the
23-23 designation is reasonably likely to:
23-24 (1) contribute to the expansion of primary employment
23-25 in the reinvestment zone; or
23-26 (2) attract major investment in the reinvestment zone
23-27 that would:
24-1 (A) be a benefit to property in the reinvestment
24-2 zone and to the school district; and
24-3 (B) contribute to the economic development of
24-4 the region of this state in which the school district is located.
24-5 (b) The governing body of the school district may seek the
24-6 recommendation of the commissioners court of each county and the
24-7 governing body of each municipality that has territory in the
24-8 school district before designating an area as a reinvestment zone
24-9 under Subsection (a).
24-10 SECTION 5. Section 312.006, Tax Code, is amended to read as
24-11 follows:
24-12 Sec. 312.006. EXPIRATION DATE. If not continued in effect,
24-13 this chapter expires September 1, 2007 [2001].
24-14 SECTION 6. Subchapter E, Chapter 42, Education Code, is
24-15 amended by adding Section 42.2515 to read as follows:
24-16 Sec. 42.2515. ADDITIONAL STATE AID FOR AD VALOREM TAX
24-17 CREDITS UNDER TEXAS ECONOMIC DEVELOPMENT ACT. (a) For each school
24-18 year, a school district, including a school district that is
24-19 otherwise ineligible for state aid under this chapter, is entitled
24-20 to state aid in an amount equal to the amount of all tax credits
24-21 credited against ad valorem taxes of the district in that year
24-22 under Subchapter D, Chapter 313, Tax Code.
24-23 (b) The commissioner may adopt rules to implement and
24-24 administer this section.
24-25 SECTION 7. Section 403.302(d), Government Code, is amended to
24-26 read as follows:
24-27 (d) For the purposes of this section, "taxable value" means
25-1 the market value of all taxable property less:
25-2 (1) the total dollar amount of any residence homestead
25-3 exemptions lawfully granted under Section 11.13(b) or (c), Tax
25-4 Code, in the year that is the subject of the study for each school
25-5 district;
25-6 (2) one-half of the total dollar amount of any
25-7 residence homestead exemptions granted under Section 11.13(n), Tax
25-8 Code, in the year that is the subject of the study for each school
25-9 district;
25-10 (3) the total dollar amount of any exemptions granted
25-11 before May 31, 1993, within a reinvestment zone under agreements
25-12 authorized by Chapter 312, Tax Code;
25-13 (4) subject to Subsection (e), the total dollar amount
25-14 of any captured appraised value of property that:
25-15 (A) is within a reinvestment zone created on or
25-16 before May 31, 1999, or is proposed to be included within the
25-17 boundaries of a reinvestment zone as the boundaries of the zone and
25-18 the proposed portion of tax increment paid into the tax increment
25-19 fund by a school district are described in a written notification
25-20 provided by the municipality or the board of directors of the zone
25-21 to the governing bodies of the other taxing units in the manner
25-22 provided by Section 311.003(e), Tax Code, before May 31, 1999, and
25-23 within the boundaries of the zone as those boundaries existed on
25-24 September 1, 1999, including subsequent improvements to the
25-25 property regardless of when made;
25-26 (B) generates taxes paid into a tax increment
25-27 fund created under Chapter 311, Tax Code, under a reinvestment zone
26-1 financing plan approved under Section 311.011(d), Tax Code, on or
26-2 before September 1, 1999; and
26-3 (C) is eligible for tax increment financing
26-4 under Chapter 311, Tax Code;
26-5 (5) the total dollar amount of any exemptions granted
26-6 under Section 11.251, Tax Code;
26-7 (6) the difference between the comptroller's estimate
26-8 of the market value and the productivity value of land that
26-9 qualifies for appraisal on the basis of its productive capacity,
26-10 except that the productivity value estimated by the comptroller may
26-11 not exceed the fair market value of the land;
26-12 (7) the portion of the appraised value of residence
26-13 homesteads of the elderly on which school district taxes are not
26-14 imposed in the year that is the subject of the study, calculated as
26-15 if the residence homesteads were appraised at the full value
26-16 required by law;
26-17 (8) a portion of the market value of property not
26-18 otherwise fully taxable by the district at market value because of:
26-19 (A) action required by statute or the
26-20 constitution of this state that, if the tax rate adopted by the
26-21 district is applied to it, produces an amount equal to the
26-22 difference between the tax that the district would have imposed on
26-23 the property if the property were fully taxable at market value and
26-24 the tax that the district is actually authorized to impose on the
26-25 property, if this subsection does not otherwise require that
26-26 portion to be deducted; or
26-27 (B) action taken by the district under
27-1 Subchapter B or C, Chapter 313, Tax Code;
27-2 (9) the market value of all tangible personal
27-3 property, other than manufactured homes, owned by a family or
27-4 individual and not held or used for the production of income;
27-5 (10) the appraised value of property the collection of
27-6 delinquent taxes on which is deferred under Section 33.06, Tax
27-7 Code;
27-8 (11) the portion of the appraised value of property
27-9 the collection of delinquent taxes on which is deferred under
27-10 Section 33.065, Tax Code; and
27-11 (12) the amount by which the market value of a
27-12 residence homestead to which Section 23.23, Tax Code, applies
27-13 exceeds the appraised value of that property as calculated under
27-14 that section.
27-15 SECTION 8. Section 481.0044, Government Code, is amended by
27-16 adding Subsections (e) and (f) to read as follows:
27-17 (e) In addition to the information required by Subsection
27-18 (d), the governing board shall include in the report under that
27-19 subsection:
27-20 (1) a listing of prospective projects identified by
27-21 the business development division of the department that proposed
27-22 to invest at least $100 million in this state, including
27-23 prospective projects that worked with the department or of which
27-24 the department was aware but that located in another state or
27-25 country;
27-26 (2) information identifying the other state or country
27-27 in which a prospective project located and stating the primary
28-1 reason identified by the department that the prospective project
28-2 did not locate in this state; and
28-3 (3) an assessment as to the effectiveness of the
28-4 incentives provided by Chapter 313, Tax Code, accompanied by
28-5 information on the number of agreements entered into by school
28-6 districts under that chapter during the preceding biennium, a
28-7 description of each project covered by an agreement, and the
28-8 details of the agreement.
28-9 (f) The comptroller shall assist the governing board and the
28-10 department in complying with Subsection (e).
28-11 SECTION 9. Subchapter K, Chapter 481, Government Code, is
28-12 amended by adding Section 481.168 to read as follows:
28-13 Sec. 481.168. ANNUAL REPORT OF TAX INCENTIVE LAWS AND
28-14 ECONOMIC DEVELOPMENT LAWS OF OTHER STATES. (a) The attorney
28-15 general, the comptroller, the Texas Department of Economic
28-16 Development, and the Council on Workforce and Economic
28-17 Competitiveness shall:
28-18 (1) conduct a survey of tax incentive laws and
28-19 economic development laws enacted in other states since 1990; and
28-20 (2) deliver to the governor, the lieutenant governor,
28-21 and the speaker of the house of representatives a joint report of
28-22 the results of the survey.
28-23 (b) The initial joint report required by this section shall
28-24 be delivered before December 31, 2002. An update of the joint
28-25 report shall be delivered before December 31 of each subsequent
28-26 year.
28-27 (c) Any interested person, including a trade association,
29-1 may provide information the person considers useful or relevant to
29-2 the survey or the joint report.
29-3 (d) Any agency of this state, on request, shall assist in
29-4 conducting the survey or in preparing the initial joint report or
29-5 an update of the joint report.
29-6 (e) The initial and each update of the joint report shall
29-7 include recommendations for legislative action.
29-8 SECTION 10. Section 2303.507, Government Code, is amended to
29-9 read as follows:
29-10 Sec. 2303.507. TAX INCREMENT FINANCING AND ABATEMENT;
29-11 LIMITATIONS ON APPRAISED VALUE. Designation of an area as an
29-12 enterprise zone is also designation of the area as a reinvestment
29-13 zone for:
29-14 (1) tax increment financing under Chapter 311, Tax
29-15 Code; [and]
29-16 (2) tax abatement under Chapter 312, Tax Code; and
29-17 (3) limitations on appraised value under Chapter 313,
29-18 Tax Code.
29-19 SECTION 11. (a) Except as provided by Subsection (b) of this
29-20 section, this Act takes effect January 1, 2002.
29-21 (b) Section 312.006, Tax Code, as amended by this Act, takes
29-22 effect September 1, 2001.