By Oliveira                                           H.B. No. 1447
         77R1401 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to a franchise tax credit for certain research and
 1-3     development activities in certain defense economic readjustment
 1-4     zones.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  Section 171.721(2), Tax Code, is amended to read
 1-7     as follows:
 1-8                 (2)  "Strategic investment area" means an area that is
 1-9     determined by the comptroller under Section 171.726 that is:
1-10                       (A)  a county within this state or a defense
1-11     economic readjustment zone designated under Chapter 2310,
1-12     Government Code, with above state average unemployment and below
1-13     state average per capita income; or
1-14                       (B)  an area within this state that is a
1-15     federally designated urban enterprise community or an urban
1-16     enhanced enterprise community.
1-17           SECTION 2. (a)  This Act takes effect January 1, 2002, and a
1-18     corporation may claim a credit under Subchapter O, Chapter 171, Tax
1-19     Code, in a defense economic readjustment zone designated as a
1-20     strategic investment area as a result of the change in law made by
1-21     this Act only:
1-22                 (1)  on a report originally due on or after that date;
1-23     and
1-24                 (2)  for expenses and payments incurred, qualified
 2-1     investments or expenditures made, and new jobs created in that area
 2-2     on or after that date.
 2-3           (b)  The change in law made by this Act does not affect taxes
 2-4     imposed before the effective date of this Act, and the law in
 2-5     effect before the effective date of this Act is continued in effect
 2-6     for purposes of the liability for and collection of those taxes.