Amend CSHB 3588 as follows:                                                  
	(1)  In Article 2, on page 57, between lines 9 and 10, insert 
the following: 
	Sec. 370.119.  TRANSFER OF LOCAL SALES TAX AUTHORITY.  (a)  
The board of an authority may impose a local sales and use tax if the 
authority to impose the tax is transferred to the authority by a 
local governmental entity, including a municipality, county, 
transit authority, or special district, that is authorized to 
impose a local sales and use tax.
	(b)  A local governmental entity that is authorized by law to 
impose a local sales and use tax may transfer all or part of that 
taxing authority to an authority if:
		(1)  the transfer of the taxing authority is approved by 
the governing body of the local governmental entity; and
		(2)  a majority of the qualified voters of the local 
governmental entity approve the transfer of the taxing authority in 
an election held for that purpose.
	(c)  If a local governmental entity transfers all or part of 
its authority to impose a sales and use tax to an authority, the 
local governmental entity's authority to impose a sales and use tax 
is reduced by the amount transferred.
	(d)  A sales and use tax imposed by an authority under this 
section is assessed, administered, and distributed under Chapter 
322, Tax Code.
	(e)  A sales and use tax imposed by an authority under this 
section may be imposed only in the geographic limits of the local 
governmental entity that transferred its taxing authority to the 
authority.
	(f)  Revenues from a sales and use tax imposed by an authority 
under this section may be used only for transportation projects 
located in the geographic limits of the local governmental entity 
that transferred its taxing capacity to the authority.
	(g)  By majority vote of the board, an authority may return to 
a local governmental entity all or part of the taxing authority 
originally transferred by that local governmental entity to the 
authority.
	(h)  This section may not be construed to authorize an 
authority to impose a sales and use tax at a rate that when combined 
with the rates of sales and use taxes imposed by the authority and 
all other governmental entities in its geographic limits would 
exceed two percent at any location in the geographic limits of the 
authority.
	(i)  For purposes of this section, a county is considered to 
transfer all or part of its taxing authority to impose a local sales 
and use tax to an authority in locations within the county in which 
the tax is below two percent.  This subsection does not preclude 
another local governmental entity from subsequently holding an 
election to authorize a local sales and use tax within the 
geographic limits of the entity, and the authority's tax rate will 
be reduced commensurate with the local governmental entity's 
increase in order for the total to not exceed two percent.
	(2)  On page 57, line 10, strike "370.119-370.160" and 
substitute "370.120-370.160".