78R2056 SMJ-D
By: Jones of Bexar H.B. No. 2956
A BILL TO BE ENTITLED
AN ACT
relating to a franchise tax credit for oil and gas producers that
make financial contributions to institutions of higher education.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 171, Tax Code, is amended by adding
Subchapter V to read as follows:
SUBCHAPTER V. TAX CREDIT FOR CONTRIBUTIONS BY GAS AND OIL PRODUCERS
TO INSTITUTIONS OF HIGHER EDUCATION
Sec. 171.901. DEFINITIONS. In this subchapter:
(1) "Gas" has the meaning assigned by Section
201.001(4).
(2) "Institution of higher education" means a public
or private institution of higher education in this state that is
accredited by a recognized accrediting agency.
(3) "Oil" has the meaning assigned by Section
202.001(3).
Sec. 171.902. APPLICATION OF SUBCHAPTER. This subchapter
applies only to a corporation that:
(1) takes gas or oil from the earth or water;
(2) owns, controls, manages, or leases a gas well or an
oil well; or
(3) owns an interest, including a royalty interest, in
gas or its value or in oil or its value, regardless of whether the
gas or oil is produced by the corporation owning the interest or by
another person on the corporation's behalf by lease, contract, or
other arrangement.
Sec. 171.903. CREDIT. A corporation that meets the
eligibility requirements under this subchapter is entitled to a
credit in the amount allowed by this subchapter against the tax
imposed under this chapter.
Sec. 171.904. EXPENDITURES ELIGIBLE FOR CREDIT. A
corporation may claim a credit under this subchapter only for a
qualifying expenditure. A qualifying expenditure is an expenditure
that is:
(1) used for teaching or research, or services that
support teaching or research, at an institution of higher
education;
(2) used for an acquisition by a library or museum that
is owned by an institution of higher education; or
(3) a contribution to the endowment of an institution
of higher education.
Sec. 171.905. AMOUNT; LIMITATIONS. (a) The amount of the
credit allowed under this subchapter is equal to 50 percent of the
portion of a corporation's qualifying expenditure that is less than
or equal to $100,000 and 100 percent of the portion of a
corporation's qualifying expenditure that exceeds $100,000.
(b) A corporation may not claim a credit under this
subchapter in an amount that, when added to all other credits
claimed for the reporting period, results in a sum that exceeds
$150,000.
(c) A corporation may claim a credit under this subchapter
for a qualifying expenditure during an accounting period only
against the tax owed for the corresponding reporting period.
Sec. 171.906. APPLICATION FOR CREDIT. (a) A corporation
must apply for a credit under this subchapter on or with the tax
report for the period for which the credit is claimed.
(b) The comptroller shall adopt a form for the application
for the credit. A corporation must use this form in applying for
the credit.
Sec. 171.907. RULES. The comptroller shall adopt rules for
implementing this subchapter, including rules requiring an
institution of higher education to report a qualifying expenditure
received under this subchapter in the institution's biennial budget
request.
Sec. 171.908. ASSIGNMENT PROHIBITED. A corporation may not
convey, assign, or transfer a credit allowed under this subchapter
to another entity unless all of the assets of the corporation are
conveyed, assigned, or transferred in the same transaction.
SECTION 2. A corporation may claim the credit under
Subchapter V, Chapter 171, Tax Code, as added by this Act, only:
(1) for a qualifying expenditure made on or after the
effective date of this Act; and
(2) on a franchise tax report due under Chapter 171,
Tax Code, on or after January 1, 2004.
SECTION 3. 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.