By Elkins                                             H.B. No. 1932
         77R5111 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to tax incentives for the sale, purchase, or use of
 1-3     certain clean-fuel vehicles and other motorized equipment.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Subchapter E, Chapter 152, Tax Code, is amended by
 1-6     adding Section 152.094 to read as follows:
 1-7           Sec. 152.094.  CLEAN-FUEL VEHICLES. (a)  In this section,
 1-8     "clean-fuel vehicle" means a vehicle that:
 1-9                 (1)  uses a fuel or power source other than gasoline or
1-10     conventional diesel fuel either exclusively or in combination with
1-11     gasoline or conventional diesel fuel; and
1-12                 (2)  meets the standards for ultra-low emission
1-13     vehicles or zero emission vehicles established under Part C,
1-14     Subchapter II, of the federal Clean Air Act, as amended (42 U.S.C.
1-15     Section 7581 et seq.).
1-16           (b)  The taxes imposed by this chapter do not apply to the
1-17     sale or use of a clean-fuel vehicle.
1-18           SECTION 2. Subchapter H, Chapter 151, Tax Code, is amended by
1-19     adding Section 151.3112 to read as follows:
1-20           Sec. 151.3112.  ALTERNATIVE FUELS CONSTRUCTION EQUIPMENT. (a)
1-21     In this section:
1-22                 (1)  "Alternative fuel" means a fuel or power source,
1-23     other than gasoline or conventional diesel fuel, that can be used
1-24     to power a motor.  The term includes electricity, compressed
 2-1     natural gas, and solar power.
 2-2                 (2)  "Machinery or equipment" includes accessories and
 2-3     repair and replacement parts.
 2-4           (b)  The sale of machinery or equipment used to improve
 2-5     realty or in the construction, renovation, or repair of a building
 2-6     or other improvement to realty is exempt from the taxes imposed by
 2-7     this chapter if the machinery or equipment is:
 2-8                 (1)  motor-driven; and
 2-9                 (2)  the motor is manufactured to be powered by, and is
2-10     powered by, an alternative fuel either exclusively or in
2-11     combination with gasoline or conventional diesel fuel, but not as
2-12     an additive or mixture to gasoline or conventional diesel fuel.
2-13           SECTION 3. (a)  This Act takes effect July 1, 2001, if it
2-14     receives a vote of two-thirds of all the members elected to each
2-15     house, as provided by Section 39, Article III, Texas Constitution.
2-16     If this Act does not receive the vote necessary for effect on that
2-17     date, Section 1 of this Act takes effect September 1, 2001, and
2-18     Section 2 of this Act takes effect October 1, 2001.
2-19           (b)  The change in law made by this Act does not affect taxes
2-20     imposed before the effective date of this Act, and the law in
2-21     effect before the effective date of this Act is continued in effect
2-22     for purposes of the liability for and collection of those taxes.