1-1                                   AN ACT
 1-2     relating to the Texas Energy Resource Council; authorizing the
 1-3     imposition of an assessment on producers of oil, gas, and
 1-4     condensate.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1. Title 70, Revised Statutes, is amended by adding
 1-7     Article 4413(47g) to read as follows:
 1-8           Art. 4413(47g).  TEXAS ENERGY RESOURCE COUNCIL
 1-9                         PART 1.  GENERAL PROVISIONS
1-10           Sec. 1.01.  DEFINITIONS.  In this article:
1-11                 (1)  "Condensate" has the meaning assigned by Section
1-12     201.001, Tax Code.
1-13                 (2)  "First purchaser" has the meaning assigned by
1-14     Section 201.001 or 202.001, Tax Code, as applicable.
1-15                 (3)  "Gas" has the meaning assigned by Section 201.001,
1-16     Tax Code.
1-17                 (4)  "Oil" has the meaning assigned by Section 202.001,
1-18     Tax Code.
1-19                 (5)  "Person" includes an individual or group of
1-20     individuals and a partnership, corporation, association,
1-21     cooperative, or other legal entity.
1-22                 (6)  "Producer" has the meaning assigned by Section
1-23     201.001 or 202.001, Tax Code, as applicable.
1-24                   PART 2.  TEXAS ENERGY RESOURCE COUNCIL
 2-1           Sec. 2.01.  COMPOSITION OF COUNCIL. (a)  The Texas Energy
 2-2     Resource Council is composed of 15 members.
 2-3           (b)  The executive officer, or a person designated by the
 2-4     executive officer, of each of the following organizations serves on
 2-5     the council:
 2-6                 (1)  the Texas Oil & Gas Association;
 2-7                 (2)  the Texas Independent Producers and Royalty Owners
 2-8     Association;
 2-9                 (3)  the Permian Basin Petroleum Association;
2-10                 (4)  The Texas Alliance of Energy Producers; and
2-11                 (5)  The Panhandle Producers and Royalty Owners
2-12     Association.
2-13           (c)  The governor shall appoint to serve on the council seven
2-14     members from lists of nominees provided by the organizations listed
2-15     in Subsection (b) of this section.
2-16           (d)  The members of the council by majority vote shall
2-17     appoint to serve on the council three members as follows:
2-18                 (1)  one representative of the crude oil purchasing
2-19     industry;
2-20                 (2)  one representative of the pipeline industry; and
2-21                 (3)  one representative of royalty owners.
2-22           Sec. 2.02.  TERMS; VACANCIES. (a)  The members of the council
2-23     appointed under Sections 2.01(c) and (d) of this article serve for
2-24     staggered six-year terms, with the terms of three or four members,
2-25     as applicable, expiring February 1 of each odd-numbered year.
2-26           (b)  A vacancy in an appointive position on the council shall
2-27     be filled for the unexpired portion of the term in the same manner
 3-1     as the original appointment.
 3-2           Sec. 2.03.  OFFICERS. (a)  The members of the council
 3-3     annually shall elect a presiding officer of the council.
 3-4           (b)  The council may elect other officers it considers
 3-5     necessary.
 3-6           Sec. 2.04.  COMPENSATION.  A member of the council may not
 3-7     receive compensation for service performed for the council.  A
 3-8     member is entitled to reimbursement, subject to any applicable
 3-9     limitation provided by the General Appropriations Act, for actual
3-10     or necessary expenses incurred in performing services as a member
3-11     of the council.  Money paid to a council member under this section
3-12     shall be paid from the energy resource account.
3-13                    PART 3.  POWERS AND DUTIES OF COUNCIL
3-14           Sec. 3.01.  POWERS AND DUTIES OF COUNCIL.  The council shall:
3-15                 (1)  coordinate a program designed to:
3-16                       (A)  promote environmentally sound energy
3-17     production methods and technologies;
3-18                       (B)  support educational activities regarding the
3-19     development of energy resources in this state;
3-20                       (C)  support job training and research activities
3-21     regarding energy production;
3-22                       (D)  educate the public regarding the importance
3-23     of the oil, natural gas, and pipeline industries;
3-24                       (E)  promote the exploration for and production
3-25     of energy; and
3-26                       (F)  promote pipeline safety; and
3-27                 (2)  implement the other provisions of this article.
 4-1                      PART 4.  ENERGY RESOURCE ACCOUNT
 4-2           Sec. 4.01.  ENERGY RESOURCE ACCOUNT. (a)  The energy resource
 4-3     account is an account in the general revenue fund that may be
 4-4     appropriated only to the council for the purposes of this article.
 4-5           (b)  The energy resource account consists of:
 4-6                 (1)  gifts and grants;
 4-7                 (2)  transfers of money to the account by the
 4-8     legislature; and
 4-9                 (3)  assessments collected under Part 5 of this
4-10     article.
4-11                             PART 5.  ASSESSMENT
4-12           Sec. 5.01.  IMPOSITION OF ASSESSMENT. (a)  An assessment is
4-13     imposed on each producer of oil, gas, or condensate.  The amount of
4-14     the assessment is four-hundredths of one percent of the market
4-15     value of oil, gas, or condensate produced and saved in this state
4-16     by the producer.  The market value of oil, gas, or condensate is
4-17     its value at the mouth of the well from which it is produced.
4-18           (b)  Notwithstanding Subsection (a)  of this section, a
4-19     producer may not be assessed more than $150,000 in any year.  For
4-20     purposes of the limitation provided by this subsection on
4-21     assessments imposed on a producer, assessments imposed on an
4-22     affiliate or subsidiary, as defined by Article 13.02, Texas
4-23     Business Corporation Act, of a producer are considered to have been
4-24     imposed on the producer.
4-25           (c)  Except as otherwise provided by this article, Chapters
4-26     201 and 202, Tax Code, apply to the assessment imposed by this
4-27     article as if the assessment were a tax imposed by those chapters.
 5-1           (d)  The assessment imposed by this article is not an
 5-2     occupation tax.
 5-3           (e)  A first purchaser or producer, as applicable, shall
 5-4     include as a separate item in any report required by Chapter 201 or
 5-5     202, Tax Code, any required information relating to the assessment
 5-6     imposed by this article.
 5-7           Sec. 5.02.  DEPOSIT OF ASSESSMENT. (a)  Except as provided by
 5-8     Subsection (b) of this section, the comptroller shall deposit an
 5-9     assessment collected under this article to the credit of the energy
5-10     resource account.
5-11           (b)  The comptroller shall retain a portion of an assessment
5-12     collected under this article to cover the cost of administering the
5-13     imposition and collection of the assessment.  The comptroller by
5-14     rule shall specify the portion of the assessment to be retained.
5-15           Sec. 5.03.  COLLECTION OF ASSESSMENT. (a)  The council is
5-16     responsible for taking appropriate legal action to collect any
5-17     assessment that is not paid to the comptroller.  The comptroller is
5-18     not responsible for collecting any assessment that is not paid to
5-19     the comptroller.
5-20           (b)  The comptroller shall report to the council any
5-21     information the comptroller obtains regarding the failure of any
5-22     person to properly pay an assessment and shall provide to the
5-23     council any documentation the comptroller may have of that failure.
5-24           Sec. 5.04.  REFUND OF ASSESSMENT. (a)  A person is entitled
5-25     to a refund of an assessment paid by the person during the
5-26     preceding state fiscal year if the person submits a request for a
5-27     refund as provided by this section.
 6-1           (b)  A request for a refund must be made to the comptroller
 6-2     not later than the third calendar month following the state fiscal
 6-3     year for which the refund is requested.  The request must be in the
 6-4     form and include the information required by the comptroller.
 6-5           (c)  If the assessment was paid by the producer, the producer
 6-6     must submit the refund request, and any refund made shall be paid
 6-7     to the producer.  If the assessment was paid by a first purchaser
 6-8     on behalf of the producer, the first purchaser, at the request of
 6-9     the producer, shall submit a request for a refund, and any refund
6-10     made shall be paid to the first purchaser.  The first purchaser
6-11     shall refund to the producer the amount refunded not later than the
6-12     60th day after the date the first purchaser receives the refund.
6-13           (d)  The council shall give notice of the right to request a
6-14     refund through:
6-15                 (1)  press releases;
6-16                 (2)  paid advertisements placed in the newspaper with
6-17     the largest circulation in each county of the state; and
6-18                 (3)  other means it considers appropriate.
6-19           (e)  The comptroller shall determine the validity of a
6-20     request for a refund.  The comptroller shall perform the
6-21     comptroller's duties under this section in a manner that minimizes,
6-22     to the extent practicable and appropriate, the burden on persons
6-23     providing information to the comptroller.
6-24           (f)  If the comptroller determines that a person is entitled
6-25     to a refund, the comptroller shall refund the amount of the
6-26     assessment paid during the preceding state fiscal year, together
6-27     with interest at a rate equal to the average rate paid over the
 7-1     preceding calendar year on United States treasury bills with a
 7-2     12-month maturity date.
 7-3           (g)  The comptroller shall make refunds under this section in
 7-4     the order in which the comptroller receives requests for refunds.
 7-5     Notwithstanding the other provisions of this section, the
 7-6     comptroller may not make refunds in a state fiscal year in an
 7-7     amount that, in the aggregate, exceeds 60 percent of the total
 7-8     amount of assessments collected during the preceding state fiscal
 7-9     year.
7-10           (h)  The comptroller may adopt rules to implement this
7-11     section.
7-12           SECTION 2. (a)  As soon as practicable after receiving the
7-13     lists described by Section 2.01(c), Article 4413(47g), Revised
7-14     Statutes, as added by this Act, the governor shall appoint persons
7-15     to serve on the Texas Energy Resource Council.  The governor shall
7-16     designate two persons to serve on the council for terms expiring
7-17     February 1, 2003, two persons to serve on the council for terms
7-18     expiring February 1, 2005, and three persons to serve on the
7-19     council for terms expiring February 1, 2007.
7-20           (b)  As soon as practicable after taking office, the members
7-21     of the Texas Energy Resource Council designated or appointed under
7-22     Sections 2.01(b) and (c), Article 4413(47g), Revised Statutes, as
7-23     added by this Act, shall appoint one person to serve on the council
7-24     for a term expiring February 1, 2003, one person to serve on the
7-25     council for a term expiring February 1, 2005, and one person to
7-26     serve on the council for a term expiring February 1, 2007.
7-27           SECTION 3. (a)  Except as otherwise provided by this section,
 8-1     this Act takes effect September 1, 2001.
 8-2           (b)  Part 5 of Article 4413(47g), Revised Statutes, as added
 8-3     by this Act, takes effect January 1, 2002, and applies only to oil,
 8-4     gas, and condensate produced and saved on or after that date.
         _______________________________     _______________________________
             President of the Senate              Speaker of the House
               I certify that H.B. No. 3348 was passed by the House on May
         11, 2001, by a non-record vote; that the House refused to concur in
         Senate amendments to H.B. No. 3348 on May 25, 2001, and requested
         the appointment of a conference committee to consider the
         differences between the two houses; and that the House adopted the
         conference committee report on H.B. No. 3348 on May 27, 2001, by a
         non-record vote.
                                             _______________________________
                                                 Chief Clerk of the House
               I certify that H.B. No. 3348 was passed by the Senate, with
         amendments, on May 22, 2001, by a viva-voce vote; at the request of
         the House, the Senate appointed a conference committee to consider
         the differences between the two houses; and that the Senate adopted
         the conference committee report on H.B. No. 3348 on May 27, 2001,
         by a viva-voce vote.
                                             _______________________________
                                                 Secretary of the Senate
         APPROVED:  __________________________
                              Date
                    __________________________
                            Governor