By Brimer H.B. No. 1200
77R945 JD-D
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 or maintain jobs in this
1-7 state, and to continuing the Property Redevelopment and Tax
1-8 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 industrial states have enacted aggressive
1-18 economic development laws designed to attract large employers,
1-19 create jobs, and strengthen their economies;
1-20 (2) the State of Texas has slipped in its national
1-21 ranking each year between 1993 and 1998 in terms of attracting
1-22 major new manufacturing facilities to this state;
1-23 (3) a large part of the Texas economy continues to be
1-24 based in the manufacturing industry and the continued growth and
2-1 overall health of the manufacturing sector serves the Texas economy
2-2 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 and to
2-15 maintain existing jobs in this state that, without business
2-16 expansion or growth, would otherwise be eliminated;
2-17 (3) attract to this state new, large-scale businesses
2-18 that are exploring opportunities to locate in other states or other
2-19 countries;
2-20 (4) encourage the retention and expansion of this
2-21 state's larger industrial and commercial enterprises that are
2-22 currently located in this state;
2-23 (5) enable local government officials and economic
2-24 development professionals to compete with other states by
2-25 authorizing economic development incentives that meet or exceed
2-26 incentives being offered to prospective employers by other states
2-27 and to provide local officials with an effective means to attract
3-1 large-scale investment;
3-2 (6) strengthen and improve the overall performance of
3-3 the economy of this state;
3-4 (7) expand and enlarge the ad valorem property tax
3-5 base of this state; and
3-6 (8) enhance this state's economic development efforts
3-7 by providing local officials with an effective local option.
3-8 Sec. 313.004. LEGISLATIVE INTENT. It is the intent of the
3-9 legislature in enacting this chapter that:
3-10 (1) economic development decisions should occur at the
3-11 local level and be consistent with identifiable statewide economic
3-12 development goals;
3-13 (2) this chapter should not be construed or
3-14 interpreted to allow:
3-15 (A) property owners to pool investments to
3-16 create sufficiently large investments to qualify for an ad valorem
3-17 tax benefit or financial benefit provided by this chapter;
3-18 (B) an applicant for an ad valorem tax benefit
3-19 or financial benefit provided by this chapter to assert that jobs
3-20 will be eliminated if certain investments are not made if the
3-21 assertion is not true; or
3-22 (C) a sole proprietorship, partnership, or
3-23 limited liability partnership to receive an ad valorem tax benefit
3-24 or financial benefit provided by this chapter; and
3-25 (3) in implementing this chapter, school districts
3-26 should:
3-27 (A) strictly interpret the criteria and
4-1 selection guidelines provided by this chapter;
4-2 (B) impose strict standards when analyzing an
4-3 application for an ad valorem tax benefit or financial benefit
4-4 provided by this chapter submitted by a property owner who asserts
4-5 that the property owner proposes to maintain jobs; and
4-6 (C) approve only those applications for an ad
4-7 valorem tax benefit or financial benefit provided by this chapter
4-8 that:
4-9 (i) enhance the local community;
4-10 (ii) improve the local public education
4-11 system;
4-12 (iii) create or maintain high-paying jobs;
4-13 and
4-14 (iv) advance the economic development
4-15 goals of this state as identified by the Texas Strategic Economic
4-16 Development Planning Commission.
4-17 Sec. 313.005. DEFINITIONS. Unless this chapter defines a
4-18 word or phrase used in this chapter, Section 1.04 or any other
4-19 section of Title 1 or this title that defines the word or phrase or
4-20 ascribes a meaning to the word or phrase applies to the word or
4-21 phrase used in this chapter.
4-22 (Sections 313.006-313.020 reserved for expansion)
4-23 SUBCHAPTER B. LIMITATION ON APPRAISED VALUE OF CERTAIN
4-24 COMMERCIAL OR INDUSTRIAL PROPERTY USED TO CREATE OR MAINTAIN JOBS
4-25 Sec. 313.021. DEFINITIONS. In this subchapter:
4-26 (1) "Qualified investment" means:
4-27 (A) tangible personal property that is first
5-1 placed in service in this state during the applicable qualifying
5-2 time period that begins on or after January 1, 2002, and is
5-3 described as Section 1245 property by Section 1245(a), Internal
5-4 Revenue Code of 1986;
5-5 (B) 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, without regard
5-8 to whether the property is affixed to or incorporated into real
5-9 property, and that is used in connection with the manufacturing,
5-10 processing, or fabrication in a cleanroom environment of a
5-11 semiconductor product, without regard to whether the property is
5-12 actually located in the cleanroom environment, including:
5-13 (i) integrated systems, fixtures, and
5-14 piping;
5-15 (ii) all property necessary or adapted to
5-16 reduce contamination or to control airflow, temperature, humidity,
5-17 chemical purity, or other environmental conditions or manufacturing
5-18 tolerances; and
5-19 (iii) production equipment and machinery,
5-20 moveable cleanroom partitions, and cleanroom lighting; or
5-21 (C) a building or a permanent, nonremovable
5-22 component of a building that is built or constructed during the
5-23 applicable qualifying time period that begins on or after January
5-24 1, 2002, and that houses tangible personal property described by
5-25 Paragraph (A) or (B).
5-26 (2) "Qualified property" means:
5-27 (A) real property:
6-1 (i) that is located during the applicable
6-2 qualifying time period:
6-3 (a) in a school district; and
6-4 (b) in an area designated as a
6-5 reinvestment zone under Chapter 311 or 312 or as an enterprise zone
6-6 under Chapter 2303, Government Code;
6-7 (ii) on which a person:
6-8 (a) proposes to establish a new
6-9 business;
6-10 (b) proposes to expand an existing
6-11 business; or
6-12 (c) proposes to modernize an
6-13 existing business;
6-14 (iii) that is not subject to a tax
6-15 abatement agreement entered into by the school district under
6-16 Chapter 312; and
6-17 (iv) on which, in connection with a
6-18 business that is located or proposed to be located on the property,
6-19 the owner of the property proposes to:
6-20 (a) make a qualified investment in
6-21 an amount equal to at least the minimum amount required by Section
6-22 313.023; and
6-23 (b) create or maintain at least 300
6-24 qualifying jobs; and
6-25 (B) tangible personal property that:
6-26 (i) is not subject to a tax abatement
6-27 agreement entered into by the school district under Chapter 312;
7-1 and
7-2 (ii) is located on real property described
7-3 by Paragraph (A) and used in connection with the business to be
7-4 established, expanded, or modernized.
7-5 (3) "Qualifying job" means a permanent full-time job
7-6 that:
7-7 (A) requires at least 1,600 hours of work a
7-8 year;
7-9 (B) is not transferred from one area in this
7-10 state to another area in this state; and
7-11 (C) if a new job, is not created to replace a
7-12 previous employee.
7-13 (4) "Qualifying time period" means the first two tax
7-14 years that begin on or after the date a person's application for a
7-15 limitation on appraised value under this section is approved.
7-16 Sec. 313.022. CATEGORIZATION OF SCHOOL DISTRICTS. For
7-17 purposes of determining the required minimum amount of a qualified
7-18 investment under Section 313.021(2)(A)(iv)(a), and the minimum
7-19 amount of a limitation on appraised value under Section 313.026(b),
7-20 school districts are categorized according to the taxable value of
7-21 property in the district for the preceding tax year determined
7-22 under Subchapter M, Chapter 403, Government Code, as follows:
7-23 CATEGORY TAXABLE VALUE OF PROPERTY
7-24 I $10 billion or more
7-25 II $1 billion or more but less than $10 billion
7-26 III $500 million or more but less than $1 billion
7-27 IV $100 million or more but less than $500 million
8-1 V less than $100 million
8-2 Sec. 313.023. MINIMUM AMOUNTS OF QUALIFIED INVESTMENT. For
8-3 each category of school district established by Section 313.022,
8-4 the minimum amount of a qualified investment under Section
8-5 313.021(2)(A)(iv)(a) is as follows:
8-6 CATEGORY MINIMUM QUALIFIED INVESTMENT
8-7 I $100 million
8-8 II $80 million
8-9 III $60 million
8-10 IV $40 million
8-11 V $20 million
8-12 Sec. 313.024. ELIGIBLE PROPERTY. This subchapter and
8-13 Subchapter C apply only to property owned by a corporation or
8-14 limited liability company to which Section 171.001 applies.
8-15 Sec. 313.025. APPLICATION; ACTION ON APPLICATION. (a) The
8-16 owner of qualified property may apply to the governing body of the
8-17 school district in which the property is located for a limitation
8-18 on the appraised value for school district ad valorem tax purposes
8-19 of the person's qualified property. An application must be made on
8-20 the form prescribed by the comptroller and include the information
8-21 required by the comptroller, and it must be accompanied by:
8-22 (1) the application fee established by the governing
8-23 body of the school district;
8-24 (2) a statement that the information in the
8-25 application is true and correct;
8-26 (3) information sufficient to show that the real and
8-27 personal property identified in the application as qualified
9-1 property meets the criteria established by Section 313.021(2);
9-2 (4) information relating to each criterion listed in
9-3 Subsection (b)(2); and
9-4 (5) information sufficient to show that the applicant
9-5 is eligible for the limitation on the appraised value of the
9-6 person's qualified property provided by this subchapter.
9-7 (b) The governing body of the school district shall conduct
9-8 an economic development evaluation of the application and approve
9-9 or disapprove an application under Subsection (a) before the 121st
9-10 day after the date the application is filed unless an extension is
9-11 agreed to by the governing body and the applicant. The governing
9-12 body may approve an application only if the governing body finds
9-13 that the information in the application is true and correct, finds
9-14 that the applicant is eligible for the limitation on the appraised
9-15 value of the person's qualified property, and determines that
9-16 granting the application is in the best interest of the school
9-17 district and this state. The economic development evaluation of
9-18 the application must include, and in conducting the evaluation the
9-19 governing body shall consider, the following:
9-20 (1) the recommendations of:
9-21 (A) the Legislative Budget Board; and
9-22 (B) the comptroller;
9-23 (2) the relationship between the applicant's industry
9-24 and the types of qualifying jobs to be created by the applicant to:
9-25 (A) the long-term economic growth plans of this
9-26 state as described in the strategic plan for economic development
9-27 submitted by the Texas Strategic Economic Development Planning
10-1 Commission under Section 481.033, Government Code, as that section
10-2 existed before February 1, 1999; and
10-3 (B) the long-term growth plans of the region of
10-4 this state where the applicant's qualified property is located;
10-5 (3) the relative level of the applicant's investment
10-6 per qualifying job to be created by the applicant;
10-7 (4) the wages, salaries, and benefits to be offered by
10-8 the applicant to qualifying job holders;
10-9 (5) the ability of the applicant to locate or relocate
10-10 in another state or another region of this state and the likelihood
10-11 that the applicant will so locate or relocate;
10-12 (6) the total amount of tax revenue the state would
10-13 forgo and the subsequent economic effect if the applicant does not
10-14 locate, expand, or modernize the business in this state;
10-15 (7) the impact the added infrastructure will have on
10-16 the region, including:
10-17 (A) revenue gains that would be realized by the
10-18 school district; and
10-19 (B) subsequent economic effects on the local and
10-20 regional tax bases;
10-21 (8) the economic condition of the region of the state
10-22 at the time the person's application is being considered;
10-23 (9) the number of new facilities built, expanded, or
10-24 modernized in the region during the two years preceding the date of
10-25 the application that were eligible to apply for a limitation on
10-26 appraised value under this section; and
10-27 (10) the effect of the applicant's proposal, if
11-1 approved, on the number or size of the school district's
11-2 instructional facilities, as defined by Section 46.001, Education
11-3 Code.
11-4 (c) In determining whether to grant an application, the
11-5 governing body of the school district, in relation to any criterion
11-6 listed in Subsection (b), is entitled to request and receive
11-7 assistance from:
11-8 (1) the comptroller;
11-9 (2) the Texas Department of Economic Development;
11-10 (3) the Council on Workforce and Economic
11-11 Competitiveness; and
11-12 (4) the Texas Workforce Commission.
11-13 (d) On receipt of an application under this section, the
11-14 school district shall deliver one copy of the application to the
11-15 comptroller and one copy to the Legislative Budget Board. Before
11-16 the 61st day after the date the copy of the application is
11-17 received, the comptroller and the Legislative Budget Board shall
11-18 each submit a recommendation to the governing body of the school
11-19 district as to whether the application should be approved or
11-20 disapproved.
11-21 (e) Before approving or disapproving an application under
11-22 this section, the governing body of the school district must make a
11-23 written finding as to each criterion listed in Subsection (b) and a
11-24 separate finding as to whether the applicant will locate or
11-25 relocate in another state or country if the application is not
11-26 approved. The governing body shall deliver a copy of those
11-27 findings to the applicant.
12-1 (f) If the governing body of the school district finds that
12-2 the applicant will not locate or relocate in another state or
12-3 country if the application is not approved, the governing body
12-4 shall disapprove the application.
12-5 (g) For purposes of determining an applicant's eligibility
12-6 for a limitation under this subchapter:
12-7 (1) the land on which a building or component of a
12-8 building described by Section 313.021(1)(C) is located is not
12-9 considered a qualified investment;
12-10 (2) property that is leased under a capitalized lease
12-11 may be considered a qualified investment;
12-12 (3) property that is leased under an operating lease
12-13 may not be considered a qualified investment; and
12-14 (4) property that is owned by a person other than the
12-15 applicant and that is pooled or proposed to be pooled with property
12-16 owned by the applicant may not be included in determining the
12-17 amount of the applicant's qualifying investment.
12-18 Sec. 313.026. LIMITATION ON APPRAISED VALUE. (a) If the
12-19 person's application is approved by the governing body of the
12-20 school district, for each of the first eight tax years that begin
12-21 during or after the applicable qualifying time period, the
12-22 appraised value for school district ad valorem tax purposes of the
12-23 person's qualified property in the school district may not exceed
12-24 the lesser of:
12-25 (1) the market value of the property; or
12-26 (2) subject to Subsection (b), the amount agreed to by
12-27 the governing body of the school district, not to exceed $100
13-1 million.
13-2 (b) The amount agreed to by the governing body of a school
13-3 district under Subsection (a)(2) must be an amount in accordance
13-4 with the following, according to the category established by
13-5 Section 313.022 to which the school district belongs:
13-6 CATEGORY AMOUNT OF LIMITATION
13-7 I $100 million
13-8 II not less than $80 million
13-9 III not less than $60 million
13-10 IV not less than $40 million
13-11 V not less than $20 million
13-12 (c) When appraising a person's qualified property subject to
13-13 a limitation on appraised value under this section, the chief
13-14 appraiser shall determine the market value of the property and
13-15 include both the market value and the appropriate value under
13-16 Subsection (a) in the appraisal records.
13-17 Sec. 313.027. CERTAIN BUSINESS INFORMATION CONFIDENTIAL.
13-18 Information provided to a school district in connection with an
13-19 application for a limitation on appraised value under this
13-20 subchapter that describes the specific processes or business
13-21 activities to be conducted or the specific tangible personal
13-22 property to be housed on real property covered by the application
13-23 is confidential and not subject to public disclosure unless the
13-24 governing body of the school district approves the application.
13-25 Information in the custody of a school district if the governing
13-26 body approves the application is not confidential under this
13-27 section.
14-1 Sec. 313.028. ANNUAL REPORT ON QUALIFYING JOBS. (a) Before
14-2 October 1 of each year, each property owner whose property is
14-3 subject to a limitation on appraised value under this subchapter
14-4 shall submit a report to the governing body of the school district
14-5 as to the current status of the qualifying jobs specified in the
14-6 property owner's application for the limitation.
14-7 (b) The report must be certified by an independent
14-8 accounting firm that is a member of the American Institute of
14-9 Certified Public Accounts or its successor.
14-10 (c) If the report shows that the current number of
14-11 qualifying jobs is less than 250, the property owner's eligibility
14-12 for the limitation on appraised value under this subchapter and for
14-13 a tax credit under Subchapter C expires on December 31 of the year
14-14 in which the report is submitted.
14-15 Sec. 313.029. TAX RATE LIMITATION. If the governing body of
14-16 a school district grants an application for a limitation on
14-17 appraised value under this section, for each of the first two tax
14-18 years that begins after the date the application is approved, the
14-19 governing body of the school district may not adopt a tax rate that
14-20 exceeds the school district's rollback tax rate under Section 26.08
14-21 for that year. If, in any tax year in which a restriction on the
14-22 school district's tax rate under this subsection is in effect, the
14-23 governing body approves a subsequent application for a limitation
14-24 on appraised value under this section, the restriction on the
14-25 school district's tax rate is extended until the first tax year
14-26 that begins after the second anniversary of the date the subsequent
14-27 application is approved.
15-1 Sec. 313.030. EXPIRATION OF SUBCHAPTER. This subchapter
15-2 expires December 31, 2012.
15-3 Sec. 313.031. PROPERTY NOT ELIGIBLE FOR TAX ABATEMENT.
15-4 Property subject to a limitation on appraised value in a tax year
15-5 under this subchapter is not eligible for tax abatement by a school
15-6 district under Chapter 312 in that tax year.
15-7 Sec. 313.032. RULES, FORMS; FEES. (a) The comptroller
15-8 shall:
15-9 (1) adopt rules and forms necessary for the
15-10 implementation and administration of this subchapter and Subchapter
15-11 C, including rules for determining whether a property owner's
15-12 property qualifies as a qualified investment under Section
15-13 313.021(1) and whether an expansion or a modernization of an
15-14 existing business will occur as required by Section
15-15 313.021(2)(A)(ii); and
15-16 (2) provide without charge one copy of the rules and
15-17 forms to any school district and to any person who states that the
15-18 person intends to apply for a limitation on appraised value under
15-19 this subchapter or a tax credit under Subchapter C.
15-20 (b) The governing body of a school district by official
15-21 action shall establish reasonable nonrefundable application fees to
15-22 be paid by property owners who apply to the district for a
15-23 limitation on the appraised value of the person's property under
15-24 this subchapter. The amount of an application fee must be
15-25 reasonable and may not exceed the greater of:
15-26 (1) the estimated cost to the district of processing
15-27 and acting on an application; or
16-1 (2) $50,000.
16-2 (Sections 313.033-313.050 reserved for expansion
16-3 SUBCHAPTER C. SCHOOL TAX CREDITS FOR CERTAIN COMMERCIAL
16-4 PROPERTY USED TO CREATE OR MAINTAIN JOBS
16-5 Sec. 313.051. DEFINITION. In this subchapter, "qualifying
16-6 time period" has the meaning assigned by Section 313.021.
16-7 Sec. 313.052. ELIGIBILITY FOR TAX CREDIT. (a) In addition
16-8 to the limitation on the appraised value of the person's qualified
16-9 property under Subchapter B, a person is entitled to a tax credit
16-10 from the school district that approved the limitation in an amount
16-11 equal to the amount of ad valorem taxes paid to that school
16-12 district and that were imposed on the portion of the appraised
16-13 value of the qualified property that exceeds the amount of the
16-14 limitation agreed to by the governing body of the school district
16-15 under Section 313.026(a)(2) in each year in the applicable
16-16 qualifying time period under Subchapter B.
16-17 (b) If the person relocates the person's business outside
16-18 the school district, the person is not entitled to the credit in or
16-19 after the year in which the relocation occurs.
16-20 Sec. 313.053. APPLICATION. An application for a tax credit
16-21 under this subchapter must be made to the governing body of the
16-22 school district to which the ad valorem taxes were paid. The
16-23 application must be:
16-24 (1) made on the form prescribed for that purpose by
16-25 the comptroller and verified by the applicant;
16-26 (2) accompanied by:
16-27 (A) a tax receipt from the collector of taxes
17-1 for the school district showing full payment of school district ad
17-2 valorem taxes on the qualified property for the applicable
17-3 qualifying time period; and
17-4 (B) any other document or information that the
17-5 comptroller or the governing body considers necessary for a
17-6 determination of the applicant's eligibility for the credit or the
17-7 amount of the credit; and
17-8 (3) filed before September 1 of the year immediately
17-9 following the applicable qualifying time period.
17-10 Sec. 313.054. ACTION ON APPLICATION; GRANT OF CREDIT.
17-11 Before the 90th day after the date the application for a tax credit
17-12 is filed, the governing body of the school district shall:
17-13 (1) determine the person's eligibility for a tax
17-14 credit under this subchapter; and
17-15 (2) if the person's application is approved, by order
17-16 or resolution direct the collector of taxes for the school
17-17 district:
17-18 (A) in each of the first seven tax years that
17-19 begin after the date the application is approved, to credit against
17-20 the taxes imposed on the qualified property by the district in that
17-21 year an amount equal to one-seventh of the total amount of tax
17-22 credit to which the person is entitled under Section 313.052,
17-23 except that the amount of a credit may not exceed 50 percent of the
17-24 total amount of ad valorem school taxes imposed on the qualified
17-25 property by the school district in the tax year for which the
17-26 credit is granted; and
17-27 (B) in the first tax year that begins on or
18-1 after the date the person's eligibility for the limitation under
18-2 Subchapter B expires, to credit against the taxes imposed on the
18-3 qualified property by the district an amount equal to the portion
18-4 of the total amount of tax credit to which the person is entitled
18-5 under Section 313.052 that was not credited against the person's
18-6 taxes under Paragraph (A) in a tax year covered by Paragraph (A),
18-7 except that the amount of a tax credit granted under this paragraph
18-8 may not exceed the total amount of ad valorem school taxes imposed
18-9 on the qualified property by the school district in the tax year
18-10 for which the credit is granted.
18-11 Sec. 313.055. REMEDY FOR ERRONEOUS CREDIT. (a) If the
18-12 comptroller and the governing body of a school district determine
18-13 that a person who received a tax credit under this subchapter for
18-14 any reason was not entitled to the credit received or was entitled
18-15 to a lesser amount of credit than the amount of the credit
18-16 received, an additional tax is imposed on the qualified property
18-17 equal to the full credit or the amount of the credit to which the
18-18 person was not entitled, as applicable, plus interest at an annual
18-19 rate of seven percent calculated from the date the credit was
18-20 issued.
18-21 (b) A tax lien attaches to the qualified property in favor
18-22 of the school district to secure payment by the person of the
18-23 additional tax and interest imposed by this section and any
18-24 penalties incurred. A person delinquent in the payment of an
18-25 additional tax under this section may not submit a subsequent
18-26 application or receive a tax credit under this subchapter in a
18-27 subsequent year.
19-1 Sec. 313.056. EXPIRATION OF SUBCHAPTER. This subchapter
19-2 expires on the date Subchapter B expires.
19-3 (Sections 313.057-313.070 reserved for expansion
19-4 SUBCHAPTER D. AVAILABILITY OF TAX CREDIT AFTER PROGRAM
19-5 EXPIRES
19-6 Sec. 313.071. SAVING PROVISIONS. (a) A limitation on
19-7 appraised value approved under Subchapter B before the expiration
19-8 of Subchapter B continues in effect according to Subchapter B as
19-9 that subchapter existed immediately before its expiration, and that
19-10 law is continued in effect for purposes of the limitation on
19-11 appraised value.
19-12 (b) The expiration of Subchapter C does not affect a
19-13 property owner's entitlement to a tax credit granted under
19-14 Subchapter C if the property owner qualified for the tax credit
19-15 before the expiration of Subchapter C.
19-16 SECTION 2. Subchapter A, Chapter 23, Tax Code, is amended by
19-17 adding Section 23.03 to read as follows:
19-18 Sec. 23.03. COMPILATION OF LARGE PROPERTIES. (a) Each year
19-19 the chief appraiser shall compile and send to the Texas Department
19-20 of Economic Development a list of properties in the appraisal
19-21 district that have a market value of $100 million or more in that
19-22 tax year.
19-23 (b) Each year, the Texas Department of Economic Development
19-24 shall:
19-25 (1) compile a list of all properties reported to the
19-26 department under Subsection (a); and
19-27 (2) deliver a copy of the list to:
20-1 (A) the comptroller;
20-2 (B) the lieutenant governor;
20-3 (C) the speaker of the house; and
20-4 (D) each member of the legislature.
20-5 SECTION 3. Subchapter A, Chapter 312, Tax Code, is amended by
20-6 adding Section 312.0025 to read as follows:
20-7 Sec. 312.0025. DESIGNATION OF REINVESTMENT ZONE BY SCHOOL
20-8 DISTRICT. Notwithstanding any other provision of this chapter to
20-9 the contrary, the governing body of a school district, in the
20-10 manner required for official action and for purposes of Subchapter
20-11 B, Chapter 313, may designate an area entirely within the territory
20-12 of the school district as a reinvestment zone if the governing body
20-13 finds that, as a result of the designation and the granting of a
20-14 limitation on appraised value under Subchapter B, Chapter 313, for
20-15 property located in the reinvestment zone, the designation is
20-16 reasonably likely to:
20-17 (1) contribute to the retention or expansion of
20-18 primary employment in the reinvestment zone; or
20-19 (2) attract major investment in the reinvestment zone
20-20 that would:
20-21 (A) be a benefit to property in the reinvestment
20-22 zone and to the school district; and
20-23 (B) contribute to the economic development of
20-24 the region of this state in which the school district is located.
20-25 SECTION 4. Section 312.006, Tax Code, is amended to read as
20-26 follows:
20-27 Sec. 312.006. EXPIRATION DATE. If not continued in effect,
21-1 this chapter expires September 1, 2007 [2001].
21-2 SECTION 5. Subchapter E, Chapter 42, Education Code, is
21-3 amended by adding Section 42.2515 to read as follows:
21-4 Sec. 42.2515. ADDITIONAL STATE AID FOR AD VALOREM TAX
21-5 CREDITS UNDER TEXAS ECONOMIC DEVELOPMENT ACT. (a) For each school
21-6 year, a school district, including a school district that is
21-7 otherwise ineligible for state aid under this chapter, is entitled
21-8 to state aid in an amount equal to the amount of all tax credits
21-9 credited against ad valorem taxes of the district in that year
21-10 under Subchapter C, Chapter 313, Tax Code.
21-11 (b) The commissioner may adopt rules to implement and
21-12 administer this section.
21-13 SECTION 6. Section 403.302(d), Government Code, is amended to
21-14 read as follows:
21-15 (d) For the purposes of this section, "taxable value" means
21-16 the market value of all taxable property less:
21-17 (1) the total dollar amount of any residence homestead
21-18 exemptions lawfully granted under Section 11.13(b) or (c), Tax
21-19 Code, in the year that is the subject of the study for each school
21-20 district;
21-21 (2) one-half of the total dollar amount of any
21-22 residence homestead exemptions granted under Section 11.13(n), Tax
21-23 Code, in the year that is the subject of the study for each school
21-24 district;
21-25 (3) the total dollar amount of any exemptions granted
21-26 before May 31, 1993, within a reinvestment zone under agreements
21-27 authorized by Chapter 312, Tax Code;
22-1 (4) subject to Subsection (e), the total dollar amount
22-2 of any captured appraised value of property that:
22-3 (A) is within a reinvestment zone created on or
22-4 before May 31, 1999, or is proposed to be included within the
22-5 boundaries of a reinvestment zone as the boundaries of the zone and
22-6 the proposed portion of tax increment paid into the tax increment
22-7 fund by a school district are described in a written notification
22-8 provided by the municipality or the board of directors of the zone
22-9 to the governing bodies of the other taxing units in the manner
22-10 provided by Section 311.003(e), Tax Code, before May 31, 1999, and
22-11 within the boundaries of the zone as those boundaries existed on
22-12 September 1, 1999, including subsequent improvements to the
22-13 property regardless of when made;
22-14 (B) generates taxes paid into a tax increment
22-15 fund created under Chapter 311, Tax Code, under a reinvestment zone
22-16 financing plan approved under Section 311.011(d), Tax Code, on or
22-17 before September 1, 1999; and
22-18 (C) is eligible for tax increment financing
22-19 under Chapter 311, Tax Code;
22-20 (5) the total dollar amount of any exemptions granted
22-21 under Section 11.251, Tax Code;
22-22 (6) the difference between the comptroller's estimate
22-23 of the market value and the productivity value of land that
22-24 qualifies for appraisal on the basis of its productive capacity,
22-25 except that the productivity value estimated by the comptroller may
22-26 not exceed the fair market value of the land;
22-27 (7) the portion of the appraised value of residence
23-1 homesteads of the elderly on which school district taxes are not
23-2 imposed in the year that is the subject of the study, calculated as
23-3 if the residence homesteads were appraised at the full value
23-4 required by law;
23-5 (8) a portion of the market value of property not
23-6 otherwise fully taxable by the district at market value because of:
23-7 (A) action required by statute or the
23-8 constitution of this state that, if the tax rate adopted by the
23-9 district is applied to it, produces an amount equal to the
23-10 difference between the tax that the district would have imposed on
23-11 the property if the property were fully taxable at market value and
23-12 the tax that the district is actually authorized to impose on the
23-13 property, if this subsection does not otherwise require that
23-14 portion to be deducted; or
23-15 (B) action taken by the district under
23-16 Subchapter B, Chapter 313, Tax Code;
23-17 (9) the market value of all tangible personal
23-18 property, other than manufactured homes, owned by a family or
23-19 individual and not held or used for the production of income;
23-20 (10) the appraised value of property the collection of
23-21 delinquent taxes on which is deferred under Section 33.06, Tax
23-22 Code;
23-23 (11) the portion of the appraised value of property
23-24 the collection of delinquent taxes on which is deferred under
23-25 Section 33.065, Tax Code; and
23-26 (12) the amount by which the market value of a
23-27 residence homestead to which Section 23.23, Tax Code, applies
24-1 exceeds the appraised value of that property as calculated under
24-2 that section.
24-3 SECTION 7. Section 481.0044, Government Code, is amended by
24-4 adding Subsection (e) to read as follows:
24-5 (e) In addition to the information required by Subsection
24-6 (d), the governing board shall include in the report under that
24-7 subsection a listing of prospective projects identified by the
24-8 business development division of the department that proposed to
24-9 invest at least $100 million in this state, including prospective
24-10 projects that worked with the department or of which the department
24-11 was aware but that located in another state or country.
24-12 SECTION 8. Subchapter K, Chapter 481, Government Code, is
24-13 amended by adding Section 481.168 to read as follows:
24-14 Sec. 481.168. ANNUAL REPORT OF TAX INCENTIVE LAWS AND
24-15 ECONOMIC DEVELOPMENT LAWS OF OTHER STATES. (a) The attorney
24-16 general, the comptroller, the Texas Department of Economic
24-17 Development, and the Council on Workforce and Economic
24-18 Competitiveness shall:
24-19 (1) conduct a survey of tax incentive laws and
24-20 economic development laws enacted in other states since 1990; and
24-21 (2) deliver to the governor, the lieutenant governor,
24-22 and the speaker of the house of representatives a joint report of
24-23 the results of the survey.
24-24 (b) The initial joint report required by this section shall
24-25 be delivered before December 31, 2002. An update of the joint
24-26 report shall be delivered before December 31 of each subsequent
24-27 year.
25-1 (c) Any interested person, including a trade association,
25-2 may provide information the person considers useful or relevant to
25-3 the survey or the joint report.
25-4 (d) The Texas Legislative Council and any other agency of
25-5 this state, on request, shall assist in conducting the survey or in
25-6 preparing the initial joint report or an update of the joint
25-7 report.
25-8 (e) The initial and each update of the joint report shall
25-9 include recommendations for legislative action.
25-10 SECTION 9. Section 2303.507, Government Code, is amended to
25-11 read as follows:
25-12 Sec. 2303.507. TAX INCREMENT FINANCING AND ABATEMENT;
25-13 LIMITATIONS ON APPRAISED VALUE. Designation of an area as an
25-14 enterprise zone is also designation of the area as a reinvestment
25-15 zone for:
25-16 (1) tax increment financing under Chapter 311, Tax
25-17 Code; [and]
25-18 (2) tax abatement under Chapter 312, Tax Code; and
25-19 (3) limitations on appraised value under Chapter 313,
25-20 Tax Code.
25-21 SECTION 10. (a) Except as provided by Subsection (b) of this
25-22 section, this Act takes effect January 1, 2002.
25-23 (b) Section 4 of this Act takes effect September 1, 2001.