By Keffer                                             H.B. No. 3352
         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 a credit against severance taxes for a person who
 1-3     transfers ownership of a water supply pipeline to a political
 1-4     subdivision of this state.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1. Subtitle I, Title 2, Tax Code, is amended by
 1-7     adding Chapter 205 to read as follows:
 1-8        CHAPTER 205. TAX CREDIT FOR TRANSFER OF WATER SUPPLY PIPELINE
 1-9           Sec. 205.001.  TAX CREDIT. A person is eligible for a tax
1-10     credit applicable against the taxes imposed by Chapters 201 and 202
1-11     in the amount and under the conditions provided by this chapter.
1-12           Sec. 205.002.  ELIGIBILITY. A person is eligible for a tax
1-13     credit under this chapter if the person owns a water supply
1-14     pipeline and transfers ownership of the pipeline to a political
1-15     subdivision of this state, including a county, municipality, or
1-16     district, for conjunctive use as a public water supply conveyance.
1-17           Sec. 205.003.  AMOUNT OF CREDIT. The amount of the credit is
1-18     50 percent of the taxes imposed by Chapters 201 and 202 for the
1-19     period that the pipeline is used as a public water supply
1-20     conveyance.
1-21           Sec. 205.004.  APPLICATION. (a)  A person must apply to the
1-22     comptroller to qualify for the credit under this chapter.  The
1-23     comptroller shall approve the application of person who
 2-1     demonstrates eligibility for the credit.
 2-2           (b)  The comptroller may require a person applying for the
 2-3     credit to provide any information the comptroller considers
 2-4     necessary to determine if the person qualifies for the credit.
 2-5           SECTION 2. This Act takes effect immediately if it receives a
 2-6     vote of two-thirds of all the members elected to each house, as
 2-7     provided by Section 39, Article III, Texas Constitution.  If this
 2-8     Act does not receive the vote necessary for immediate effect, this
 2-9     Act takes effect September 1, 2001.
2-10           (b)  This Act applies only to the transfer of ownership of a
2-11     water supply pipeline that takes place on or after the effective
2-12     date of this Act.