By:  Van de Putte                                      S.B. No. 274
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the contracting authority of, authorized uses for tax
 1-3     proceeds by, and eligibility for participation in tax increment
 1-4     financing of Bexar County Hospital District and Harris County
 1-5     Hospital District.
 1-6           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-7           SECTION 1.  Subchapter E, Chapter 281, Health and Safety
 1-8     Code, is amended by adding Section 281.095 to read as follows:
 1-9           Sec. 281.095.  PROHIBITION AGAINST PARTICIPATION IN TAX
1-10     INCREMENT FINANCING BY CERTAIN HOSPITAL DISTRICTS.  (a)  In this
1-11     section, "district" means Bexar County Hospital District or Harris
1-12     County Hospital District.
1-13           (b)  The district may not enter into a contract or agreement
1-14     to pay into a tax increment fund any of the district's tax
1-15     increment produced from property located in a reinvestment zone
1-16     under Chapter 311, Tax Code.  This subsection does not affect the
1-17     validity of an agreement entered into by the district before
1-18     September 1, 2001, to pay a portion of the district's tax increment
1-19     into a tax increment fund under Chapter 311, Tax Code.
1-20           (c)  The proceeds of a tax imposed under Section 281.121 may
1-21     not be used to make a payment into a tax increment fund under
1-22     Chapter 311, Tax Code, if that payment is prohibited by this
1-23     section.
1-24           (d)  A project plan or reinvestment zone financing plan
1-25     approved under Section 311.011, Tax Code, on or after September 1,
 2-1     2001, may not include any of the district's tax increment or any
 2-2     other funds derived from the district as a source of revenue to
 2-3     finance or pay project costs.
 2-4           (e)  A project plan or reinvestment zone financing plan
 2-5     approved under Section 311.011, Tax Code, before September 1, 2001,
 2-6     may not be amended on or after September 1, 2001, to:
 2-7                 (1)  increase the percentage of the district's tax
 2-8     increment to be contributed to a tax increment fund;
 2-9                 (2)  increase the time during which the district is to
2-10     contribute any of the district's tax increment to a tax increment
2-11     fund;
2-12                 (3)  allow or require the district, if it was not
2-13     included in the originally approved project plan or reinvestment
2-14     zone financing plan, to contribute any of the district's tax
2-15     increment or other money to a tax increment fund; or
2-16                 (4)  allow the district to pay into a tax increment
2-17     fund any of the district's tax increment derived from property
2-18     added to the reinvestment zone on or after September 1, 2001.
2-19           (f)  An agreement entered into by the district under Section
2-20     311.013(f), Tax Code, before September 1, 2001, may not be amended
2-21     on or after September 1, 2001, to include any of the conditions
2-22     prohibited by Subsection (e).
2-23           SECTION 2.  This Act takes effect September 1, 2001.
2-24                          COMMITTEE AMENDMENT NO. 1
2-25           Amend SB 274 as follows:
2-26     on line 1-11, after the last word of "Bexar County Hospital
 3-1     District" add ", Nueces County Hospital District, El Paso County
 3-2     Hospital District or"
 3-3           Sec. 281.095.  PROHIBITION AGAINST PARTICIPATION IN TAX
 3-4     INCREMENT FINANCING BY CERTAIN HOSPITAL DISTRICTS. (a)  In this
 3-5     section, "district" means Bexar County Hospital District, Nueces
 3-6     County Hospital District, El Paso County Hospital District or
 3-7     Harris County Hospital District".
 3-8                                                                  Ramsay