78(R) HB 164 - Senate Committee Report version


                                                                                


By:  Truitt (Senate Sponsor - Nelson)                             H.B. No. 164
	(In the Senate - Received from the House April 1, 2003; 
April 7, 2003, read first time and referred to Committee on 
Intergovernmental Relations; May 7, 2003, reported favorably by 
the following vote:  Yeas 4, Nays 0; May 7, 2003, sent to printer.)


A BILL TO BE ENTITLED

AN ACT


relating to the rates at which the municipal sales and use tax for 
street maintenance may be imposed.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 327.003(b) and (c), Tax Code, are 
amended to read as follows:
	(b)  A municipality may not adopt a tax under this chapter or 
increase the rate of the tax if as a result of the adoption of the 
tax or the increase in the rate of the tax the combined rate of all 
sales and use taxes imposed by the municipality and other political 
subdivisions of this state having territory in the municipality 
would exceed two percent at any location in the municipality.
	(c)  If the voters of a municipality approve the adoption of 
the tax or the increase in the rate of the tax at an election held on 
the same election date on which another political subdivision 
adopts a sales and use tax or approves the increase in the rate of 
its sales and use tax and as a result the combined rate of all sales 
and use taxes imposed by the municipality and other political 
subdivisions of this state having territory in the municipality 
would exceed two percent at any location in the municipality, the 
election to adopt a sales and use tax under this chapter has no 
effect.
	SECTION 2.  Section 327.004, Tax Code, is amended to read as 
follows:        
	Sec. 327.004.  TAX RATE.  The [rate of the] tax authorized by 
this chapter may be imposed at the rate of one-eighth of one percent 
or [is] one-fourth of one percent.
	SECTION 3.  Section 327.005(a), Tax Code, is amended to read 
as follows:     
	(a)  The adoption of the tax or the change in the rate of the 
tax takes effect on the first day of the first calendar quarter 
occurring after the expiration of the first complete calendar 
quarter occurring after the date on which the comptroller receives 
notice of the results of the election.
	SECTION 4.  Section 327.006(b), Tax Code, is amended to read 
as follows:     
	(b)  At an election to adopt the tax, the ballot shall be 
prepared to permit voting for or against the proposition:  "The 
adoption of a local sales and use tax in (name of municipality) at 
the rate of (insert one-eighth of one percent or one-fourth of one 
percent)[one-fourth of one percent] to provide revenue for 
maintenance and repair of municipal streets."
	SECTION 5.  Chapter 327, Tax Code, is amended by adding 
Section 327.0065 to read as follows:
	Sec. 327.0065.  RATE CHANGE.  (a)  A municipality that has 
adopted a sales and use tax under this chapter at a rate of 
one-fourth of one percent may by ordinance decrease the rate of the 
tax to one-eighth of one percent.
	(b)  A municipality that has adopted a sales and use tax 
under this chapter at a rate of one-eighth of one percent may by 
ordinance increase the rate of the tax to one-fourth of one percent 
if the increase is authorized at an election held in the 
municipality.
	(c)  The ballot for an election to increase the tax shall be 
printed to permit voting for or against the proposition:  "The 
adoption of a local sales and use tax in (name of municipality) at 
the rate of one-fourth of one percent to provide revenue for 
maintenance and repair of municipal streets."
	SECTION 6.  Section 327.007(b), Tax Code, is amended to read 
as follows:     
	(b)  An election to reauthorize the tax is called and held in 
the same manner as an election to adopt the tax under Section 
327.006, except the ballot proposition shall be prepared to permit 
voting for or against the proposition:  "The reauthorization of the 
local sales and use tax in (name of municipality) at the rate of 
(insert appropriate rate) [one-fourth of one percent] to continue 
providing revenue for maintenance and repair of municipal streets."
	SECTION 7.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2003.



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