S.B. 353 78(R)    BILL ANALYSIS


S.B. 353
By: Shapleigh
Border and International Affairs
Committee Report (Unamended)



BACKGROUND AND PURPOSE 

Under current law ( 311, 013(f), Tax Code) a taxing unit is not required
to pay into the tax increment fund (fund) any of its tax increment derived
from property in a reinvestment zone. However, current law ( 311.013(h),
Tax Code) creates an exception which provides that a taxing unit for a
city with a population that exceeds 230,000 and that borders the United
Mexican States (Mexico) is still required to pay into the fund. At
present, El Paso is the only city which meets this description. 

In December of 2001, the City of El Paso passed two Ordinances (No. 14996,
No 14999) establishing Tax Increment Finance Districts No. 2 & No. 3.
Subsequently, the County of El Paso expressed its desire to waive
participation in the districts and the City of El Paso signed a Settlement
Contract with the County of El Paso allowing the County to waive
participation. 

S.B. 353 would provide that a taxing unit that levies taxes on property in
a reinvestment zone within a city with a population of more than 230,000
and that borders Mexico is not required to pay into the fund.  


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly delegate
any additional rulemaking authority to a state officer, department,
agency, or institution. 
   
ANALYSIS

SECTION 1. Senate Bill 353 amends the Tax Code by repealing  311.013 (h)
such that a taxing unit that levies taxes on property in a reinvestment
zone within a city with a population that exceeds 230,000 and borders
Mexico is not required to pay into the tax increment fund any of its tax
increment derived from property in the reinvestment zone. 

SECTION 2. Effective Date.

EFFECTIVE DATE

On passage or, if the Act does not receive the necessary vote, the Act
takes effect September 1, 2003.