1-1 By: Oliveira (Senate Sponsor - Van de Putte) H.B. No. 1448
1-2 (In the Senate - Received from the House April 26, 2001;
1-3 April 27, 2001, read first time and referred to Committee on
1-4 Intergovernmental Relations; May 9, 2001, reported favorably by the
1-5 following vote: Yeas 6, Nays 0; May 9, 2001, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to authorizing the governing body of a municipality or a
1-9 county to enter into a tax abatement agreement with the owner of a
1-10 leasehold interest in real property that is located in a
1-11 reinvestment zone.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 312.204(a), Tax Code, is amended to read
1-14 as follows:
1-15 (a) The governing body of a municipality eligible to enter
1-16 into tax abatement agreements under Section 312.002 may agree in
1-17 writing with the owner of taxable real property that is located in
1-18 a reinvestment zone, but that is not in an improvement project
1-19 financed by tax increment bonds, to exempt from taxation a portion
1-20 of the value of the real property or of tangible personal property
1-21 located on the real property, or both, for a period not to exceed
1-22 10 years, [subject to the rights of holders of outstanding bonds of
1-23 the municipality,] on the condition that the owner of the property
1-24 make specific improvements or repairs to the property. The
1-25 governing body of an eligible municipality may agree in writing
1-26 with the owner of a leasehold interest in tax-exempt real property
1-27 that is located in a reinvestment zone, but that is not in an
1-28 improvement project financed by tax increment bonds, to exempt a
1-29 portion of the value of property subject to ad valorem taxation,
1-30 including the leasehold interest, improvements, or tangible
1-31 personal property located on the real property, for a period not to
1-32 exceed 10 years, on the condition that the owner of the leasehold
1-33 interest make specific improvements or repairs to the real
1-34 property. A tax abatement agreement under this section is subject
1-35 to the rights of holders of outstanding bonds of the municipality.
1-36 An agreement exempting taxable real property or leasehold interests
1-37 or improvements on tax-exempt real property may provide for the
1-38 exemption of such taxable interests [the real property] in each
1-39 year covered by the agreement only to the extent its value for that
1-40 year exceeds its value for the year in which the agreement is
1-41 executed. An agreement exempting tangible personal property
1-42 located on taxable or tax-exempt real property may provide for the
1-43 exemption of tangible personal property located on the real
1-44 property in each year covered by the agreement other than tangible
1-45 personal property that was located on the real property at any time
1-46 before the period covered by the agreement with the municipality,
1-47 including [and other than] inventory and [or] supplies. In a
1-48 municipality that has a comprehensive zoning ordinance, an
1-49 improvement, repair, development, or redevelopment taking place
1-50 under an agreement under this section must conform to the
1-51 comprehensive zoning ordinance.
1-52 SECTION 2. Section 312.210(b), Tax Code, is amended to read
1-53 as follows:
1-54 (b) A tax abatement agreement with the owner of real
1-55 property or tangible personal property that is located in the
1-56 reinvestment zone described by Subsection (a) and in a school
1-57 district that has a wealth per student that does not exceed the
1-58 equalized wealth level must exempt from taxation:
1-59 (1) the portion of the value of the property in the
1-60 amount specified in the joint agreement among the municipality,
1-61 county, and junior college district; and
1-62 (2) an amount equal to 10 percent of the maximum
1-63 portion of the value of the property that may under Section
1-64 312.204(a) be otherwise exempted from taxation.
2-1 SECTION 3. Section 312.402(a), Tax Code, is amended to read
2-2 as follows:
2-3 (a) The commissioners court may execute a tax abatement
2-4 agreement with the owner of taxable real property located in a
2-5 reinvestment zone designated under this subchapter. The court may
2-6 execute a tax abatement agreement with the owner of a leasehold
2-7 interest in tax-exempt real property or leasehold interests or
2-8 improvements on tax-exempt real property that is located in a
2-9 reinvestment zone designated under this subchapter to exempt a
2-10 portion of the value of tangible personal property or leasehold
2-11 interests or improvements on tax-exempt real property located on
2-12 the real property. The execution, duration, and other terms of an
2-13 agreement made under this section are governed by the provisions of
2-14 Sections 312.204, 312.205, and 312.211 applicable to a
2-15 municipality. Section 312.2041 applies to an agreement made by a
2-16 county under this section in the same manner as it applies to an
2-17 agreement made by a municipality under Section 312.204 or 312.211.
2-18 SECTION 4. An agreement with the owner of a leasehold
2-19 interest in tax-exempt property to exempt a portion of the value of
2-20 tangible personal property located on the real property as
2-21 described by Section 312.204(a), 312.210(b), or 312.402(a), Tax
2-22 Code, as amended by this Act, that was entered into before the
2-23 effective date of this Act is validated as of the date the
2-24 agreement was entered into.
2-25 SECTION 5. This Act takes effect immediately if it receives
2-26 a vote of two-thirds of all the members elected to each house, as
2-27 provided by Section 39, Article III, Texas Constitution. If this
2-28 Act does not receive the vote necessary for immediate effect, this
2-29 Act takes effect September 1, 2001.
2-30 * * * * *