79R7814 JD-F

By:  Madla                                                        S.B. No. 1339



A BILL TO BE ENTITLED

AN ACT

relating to the limitation on the sales and use tax rate of a 
political subdivision in an advanced transportation district.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 451.706, Transportation Code, is amended 
by amending Subsection (b) and adding Subsection (b-1) to read as 
follows:
	(b)  Except as provided by Subsection (b-1), if [If] after an 
election held under this subchapter the imposition of the 
district's tax in a participating unit would exceed the limit 
imposed under Subsection (a), the election of a participating unit 
to join the district repeals all other local sales and use taxes in 
that unit, except for:
		(1)  the sales and use tax of the authority; [and]           
		(2)  a sales and use tax of not more than one percent 
imposed by a municipality under Section 321.101(a) or 321.103(a), 
Tax Code; or
		(3)  a sales and use tax, or the dedicated portion of a 
sales and use tax, that is imposed to pay the principal of and 
interest on a debt of the participating unit.
	(b-1)  If after repealing all other local sales and use taxes 
under Subsection (b) the imposition of the district's tax would 
still cause the tax rate in the participating unit to exceed the 
limitation imposed under Subsection (a), the unit does not become 
part of the district until the rate imposed in the unit does not 
exceed the limitation.  A sales and use tax or dedicated portion of 
a tax imposed in the unit that is described by Subsection (b)(3) is 
repealed on retirement of the debt for which the tax or portion was 
imposed.
	SECTION 2.  The change in law made by this Act applies only 
to a political subdivision that participates in or that holds an 
election to join an advanced transportation district on or after 
the effective date of this Act.
	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, 2005.