By Counts H.B. No. 3348 Line and page numbers may not match official copy. Bill not drafted by TLC or Senate E&E. A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the Texas Energy Resource Council. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Title 70, Revised Statutes, is amended by adding 1-5 Article 4413(47g) to read as follows: 1-6 Art. 4413(47g). TEXAS ENERGY RESOURCE BOARD 1-7 ARTICLE 1. GENERAL PROVISIONS 1-8 Sec. 1.01. In this Act: 1-9 (1) "Condensate" has the meaning assigned by Section 1-10 201.001, Tax Code. 1-11 (2) "Gas" has the meaning assigned by Section 201.001, 1-12 Tax Code. 1-13 (3) "Oil" has the meaning assigned by Section 202.001, 1-14 Tax Code. 1-15 (4) "Person" means any individual, group of 1-16 individuals, or any partnership, corporation, association, 1-17 cooperative, or employee thereof, or any other entity. 1-18 (5) "Qualified producer association" means any 1-19 non-profit entity organized under Internal Revenue Service Code 1-20 501(c)(6) in existence as of September 1, 2001, a majority of whose 1-21 governing body is composed of persons involved in the exploration 1-22 and production of oil and gas in the State of Texas. 1-23 ARTICLE 2. TEXAS ENERGY RESOURCE COUNCIL 2-1 Sec. 2.01. (a) The Texas Energy Resource Council is created 2-2 and is composed of nine members. 2-3 (b) The governor shall appoint the members of the council 2-4 from lists provided by qualified producer associations. 2-5 (c) Appointed members serve for staggered terms of three 2-6 years with the terms of three members expiring on December 31 of 2-7 each year. 2-8 (d) The governor shall appoint an individual to fill the 2-9 unexpired portion of the term of a vacancy of an appointed member 2-10 of the council in the same manner as the original appointment. 2-11 (e) After September 1, 2001, the members of the council 2-12 appointed by the governor may by majority vote appoint a 2-13 representative from the following groups: 2-14 (1) a representative of royalty owners; 2-15 (2) a representative of the crude oil purchasing 2-16 industry; and 2-17 (3) a representative of the pipeline industry. 2-18 These additional members shall have full voting rights and 2-19 privileges and will serve three-year terms. They may be removed 2-20 from the council by majority vote of the members appointed by the 2-21 governor. 2-22 Sec. 2.02. (a) The members of the council shall elect 2-23 annually a presiding officer of the council. 2-24 (b) The council may elect other officers it considers 2-25 necessary. 2-26 (c) A member of the council may not receive compensation for 3-1 service performed for the council. A member is entitled to receive 3-2 reimbursement, subject to any applicable limitation provided by the 3-3 General Appropriations Act, for actual or necessary expenses 3-4 incurred in performing services as a member of the council. Money 3-5 for expense reimbursement shall be deducted from the Energy 3-6 Resource Fund as described by Section 3 of this Act. 3-7 Sec. 2.03. The purposes of this Act and of the council are to 3-8 coordinate a program designed to promote environmentally sound 3-9 production methods and technologies, to support educational 3-10 activities regarding the development of energy resources in the 3-11 State of Texas, to support job training and research activities 3-12 regarding energy production, to educate the public regarding the 3-13 importance of the oil, natural gas, and pipeline industries, to 3-14 promote exploration, production, and pipeline safety, and to 3-15 implement and comply with the provisions of this Act. 3-16 ARTICLE 3. ENERGY RESOURCE FUND 3-17 Sec. 3.01 (a) The energy resource fund is created as a 3-18 special fund in the general revenue fund. 3-19 (b) The fund consists of gifts, grants, and funds 3-20 appropriated by the legislature and the assessments collected under 3-21 Section 4 of this Act. 3-22 (c) Money in the fund may be used by the council, its 3-23 employees, or agents for the purposes described by Section 2.03 of 3-24 this Act. 3-25 ARTICLE 4. ASSESSMENT 3-26 Sec. 4.01. (a) To fund the purposes and activities of the 4-1 Texas Energy Resource Council, an assessment is imposed on the 4-2 production of oil, gas, and condensate produced in this state in 4-3 the amount of one-tenth of one percent of gross revenues received 4-4 at the wellhead. 4-5 (b) Chapter 201 and 202, Tax Code, apply to the 4-6 administration and collection of the assessment imposed by this 4-7 Act. 4-8 (c) Proceeds from the assessment shall be deposited to the 4-9 energy resource fund as provided by Section 3.01 of this Act. 4-10 (d) To defray the costs of collecting and administering the 4-11 assessment imposed by this Section, the comptroller shall retain a 4-12 portion of the proceeds collected from the assessment in an amount 4-13 approximately equal to the amount necessary for administering this 4-14 Section. 4-15 Sec. 4.02. The council is responsible for taking appropriate 4-16 legal actions to collect any assessment which is not paid or is not 4-17 properly paid. The comptroller shall not be responsible for 4-18 collecting any assessment not remitted to the comptroller for 4-19 deposit in the energy resource fund. The comptroller shall report 4-20 to the council any information it obtains regarding failure of any 4-21 person to properly pay the assessment due, including any 4-22 documentation it may have of such failure. 4-23 Sec. 4.03. (a) Any person subject to the assessment levied 4-24 by Section 4.01(a) of this Act may request a refund as provided in 4-25 this Section of the assessment paid on production for the preceding 4-26 calendar year. Upon compliance with the provisions of this Section 5-1 and rules promulgated by the council to implement this Section, the 5-2 council shall refund to each person requesting a refund of the 5-3 amount of the assessment paid by or on behalf of such person during 5-4 the preceding calendar year. Refunds will include interest earned 5-5 at the rate equal to the average United States Treasury bill rate 5-6 of the preceding calendar year as certified by the comptroller. 5-7 (b) The request for a refund of the assessment paid on 5-8 production for the preceding calendar year for which the refund is 5-9 requested. Failure to request a refund during this period shall 5-10 terminate the right of any person to receive a refund for the 5-11 assessment paid on production for the preceding calendar year. The 5-12 council shall give notice of the availability of the refund through 5-13 press releases, paid advertisements placed in the newspaper with 5-14 the largest general circulation in each county of the state, and 5-15 such other means as it deems appropriate. 5-16 (c) Each person requesting a refund shall execute an 5-17 affidavit showing the amount of refund requested, and that the 5-18 affiant was the person responsible for paying the assessment for 5-19 which the refund is requested. Each person requesting a refund 5-20 shall submit supporting evidence demonstrating the gross revenues, 5-21 net to the person's revenue interest, received person's revenue 5-22 interest, received for oil, gas, or condensate in Texas. The 5-23 council may verify principally, through the use of audits, the 5-24 accuracy of the request for refund, the council shall exercise its 5-25 authority in a manner that will reduce, to the extent practicable 5-26 and appropriate, the burden on the persons providing the 6-1 information to the Council. 6-2 SECTION 2. This Act takes effect september 1, 2001.