79R11775 E


By:  Hill                                                         H.B. No. 3016

Substitute the following for H.B. No. 3016:                                   

By:  Hamilton                                                 C.S.H.B. No. 3016



A BILL TO BE ENTITLED

AN ACT

relating to the determination of the market value of certain drug 
supplies for ad valorem property tax purposes.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 23.12, Tax Code, is amended by adding 
Subsection (h) to read as follows:
	(h)  In determining the market value of drug supplies held in 
surplus, the chief appraiser shall exclude as economic obsolescence 
from the market value cost attributable to "drug supplies held in 
surplus" that are in excess of the amount of drugs held for normal 
market purposes.  "Drug supplies held in surplus" consist of drugs 
or medicines as defined by Section 151.313 that are owned by the 
holder of a license for the wholesale distribution of drugs under 
Chapter 431, Health and Safety Code, excluding pharmaceutical drug 
manufacturers, retail pharmacies, or chain pharmacies, and are held 
for less than 60 days, for response to public health demands, 
emergency treatment, or similar health care needs.  In calculating 
the number of days "drug supplies held in surplus" are held in 
inventory, a wholesale distributor of drugs will quantify for 
appraisal rendition purposes the average days of "cycle stock" 
inventory held to meet normal customer demand and will subtract the 
average days of "cycle stock" inventory from "total pharmaceutical 
drug inventory."
	SECTION 2.  This Act takes effect January 1, 2006.