LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              April 12, 2001
  
  
          TO:  Honorable Frank Madla, Chair, Senate Committee on
               Intergovernmental Relations
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB1480  by Madla (Relating to the administration of
               reinvestment zones for tax increment finance and ad
               valorem tax abatement and to ad valorem tax abatement
               agreements for property in a reinvestment zone.), As
               Introduced
  
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*  No significant fiscal implication to the State is anticipated.        *
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The bill would amend Section 311.009 of the Tax Code to grant additional
appointment authority regarding reinvestment zone boards of directors to
taxing units that pay into a tax increment financing (TIF) fund.

Taxing units that had approved the payment of all or part of the tax
increment produced by the unit would have the right to appoint as many
board members as had the city that created the reinvestment zone.  The
bill would allow for the appointment of the board chairman by fellow
board members.

The bill would amend Chapter 312 of the Tax Code to allow the governing
body of a taxing unit to impose a reasonable fee, not to exceed $1,000,
in connection with a property owner's application or request for a tax
abatement.

Proprietary information provided to a taxing unit in connection with a
tax abatement would remain confidential after an abatement agreement was
executed.  An abatement agreement would be permitted to take effect on
January 1 of the next tax year following the substantial completion of
improvements or repairs required by the agreement.  The current
requirement that other taxing units must execute a tax abatement
agreement with the owner no later than the 90th day after the date the
municipal agreement was executed would be deleted.
  
Local Government Impact
  
If tax abatement agreements were to take effect after improvements had
been made and value added to the taxable real property located in the
reinvestment zone, the bill could affect tax abatement exemptions granted
by taxing units.

Additionally, the bill could result in additional revenue to taxing units
choosing to impose the discretionary fee.  The amount of such revenues
would depend on the number of units imposing such a fee, the number of
applicants, and the amounts of the fees charged.

Note:  According to the Comptroller's Property Tax Division, taxing units
reported 276 tax abatement agreements executed in tax year 2001.
  
  
Source Agencies:   304   Comptroller of Public Accounts
LBB Staff:         JK, DB, BR