By Oliveira H.B. No. 1448
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to authorizing the governing body of a municipality or a
1-3 county to enter into a tax abatement agreement with the owner of a
1-4 leasehold interest in real property that is located in a
1-5 reinvestment zone.
1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-7 SECTION 1. Section 312.204(a), Tax Code, is amended to read
1-8 as follows:
1-9 (a) The governing body of a municipality eligible to enter
1-10 into tax abatement agreements under Section 312.002 may agree in
1-11 writing with the owner of taxable real property that is located in
1-12 a reinvestment zone, but that is not in an improvement project
1-13 financed by tax increment bonds, to exempt from taxation a portion
1-14 of the value of the real property or of tangible personal property
1-15 located on the real property, or both, for a period not to exceed
1-16 10 years, [subject to the rights of holders of outstanding bonds of
1-17 the municipality,] on the condition that the owner of the property
1-18 make specific improvements or repairs to the property. The
1-19 governing body of an eligible municipality may agree in writing
1-20 with the owner of a leasehold interest in tax-exempt real property
1-21 that is located in a reinvestment zone, but that is not in an
1-22 improvement project financed by tax increment bonds, to exempt a
1-23 portion of the value of property subject to ad valorem taxation,
1-24 including the leasehold interest, improvements, or tangible
2-1 personal property located on the real property, for a period not to
2-2 exceed 10 years, on the condition that the owner of the leasehold
2-3 interest make specific improvements or repairs to the real
2-4 property. A tax abatement agreement under this section is subject
2-5 to the rights of holders of outstanding bonds of the municipality.
2-6 An agreement exempting taxable real property or leasehold interests
2-7 or improvements on tax-exempt real property may provide for the
2-8 exemption of such taxable interests [the real property] in each
2-9 year covered by the agreement only to the extent its value for that
2-10 year exceeds its value for the year in which the agreement is
2-11 executed. An agreement exempting tangible personal property
2-12 located on taxable or tax-exempt real property may provide for the
2-13 exemption of tangible personal property located on the real
2-14 property in each year covered by the agreement other than tangible
2-15 personal property that was located on the real property at any time
2-16 before the period covered by the agreement with the municipality,
2-17 including [and other than] inventory and [or] supplies. In a
2-18 municipality that has a comprehensive zoning ordinance, an
2-19 improvement, repair, development, or redevelopment taking place
2-20 under an agreement under this section must conform to the
2-21 comprehensive zoning ordinance.
2-22 SECTION 2. Section 312.210(b), Tax Code, is amended to read
2-23 as follows:
2-24 (b) A tax abatement agreement with the owner of real
2-25 property or tangible personal property that is located in the
2-26 reinvestment zone described by Subsection (a) and in a school
2-27 district that has a wealth per student that does not exceed the
3-1 equalized wealth level must exempt from taxation:
3-2 (1) the portion of the value of the property in the
3-3 amount specified in the joint agreement among the municipality,
3-4 county, and junior college district; and
3-5 (2) an amount equal to 10 percent of the maximum
3-6 portion of the value of the property that may under Section
3-7 312.204(a) be otherwise exempted from taxation.
3-8 SECTION 3. Section 312.402(a), Tax Code, is amended to read
3-9 as follows:
3-10 (a) The commissioners court may execute a tax abatement
3-11 agreement with the owner of taxable real property located in a
3-12 reinvestment zone designated under this subchapter. The court may
3-13 execute a tax abatement agreement with the owner of a leasehold
3-14 interest in tax-exempt real property or leasehold interests or
3-15 improvements on tax-exempt real property that is located in a
3-16 reinvestment zone designated under this subchapter to exempt a
3-17 portion of the value of tangible personal property or leasehold
3-18 interests or improvements on tax-exempt real property located on
3-19 the real property. The execution, duration, and other terms of an
3-20 agreement made under this section are governed by the provisions of
3-21 Sections 312.204, 312.205, and 312.211 applicable to a
3-22 municipality. Section 312.2041 applies to an agreement made by a
3-23 county under this section in the same manner as it applies to an
3-24 agreement made by a municipality under Section 312.204 or 312.211.
3-25 SECTION 4. An agreement with the owner of a leasehold
3-26 interest in tax-exempt property to exempt a portion of the value of
3-27 tangible personal property located on the real property as
4-1 described by Section 312.204(a), 312.210(b), or 312.402(a), Tax
4-2 Code, as amended by this Act, that was entered into before the
4-3 effective date of this Act is validated as of the date the
4-4 agreement was entered into.
4-5 SECTION 5. This Act takes effect immediately if it receives
4-6 a vote of two-thirds of all the members elected to each house, as
4-7 provided by Section 39, Article III, Texas Constitution. If this
4-8 Act does not receive the vote necessary for immediate effect, this
4-9 Act takes effect September 1, 2001.