Austin, Texas
                    FISCAL NOTE, 77th Regular Session
                                Revision 1
                                May 9, 2001
          TO:  Honorable Rodney Ellis, Chair, Senate Committee on Finance
        FROM:  John Keel, Director, Legislative Budget Board
       IN RE:  HB2845  by Danburg (Relating to the creation of an
               initiative to promote the commercialization of fuel cell
               technologies, including tax exemptions and reductions
               for certain corporations.), As Engrossed
*  No significant fiscal implication to the State is anticipated.        *
The bill would mandate that the State Energy Conservation Office, with
assistance and support from the Texas Natural Resource Conservation
Commission, Public Utility Commission, and other state and local
agencies, develop a statewide plan to accelerate the commercialization of
fuel cells in Texas.  This portion of the bill would have no effect on
state or local revenues and would not authorize the use of state or local

The bill would also exempt from the franchise tax those corporations
engaged solely in the business of manufacturing, selling, or installing
fuel cell devices.  The bill would allow a corporation to deduct from its
apportioned taxable capital the amortized cost of a fuel cell device or
from its apportioned taxable earned surplus 10 percent of the amortized
cost of a fuel cell device.  The Comptroller's office indicates that the
current commercial market for fuel cell devices is such that no
significant fiscal impact would be anticipated in fiscal 2002 and 2003.
After 2003, the development of fuel cell markets and the corresponding
effect on franchise tax incentives cannot be estimated by the
Comptroller's office.

The bill would take effect September 1, 2001.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies:   304   Comptroller of Public Accounts
LBB Staff:         JK, SD, CL, SF