80R10634 JJT-F
 
  By: Isett H.B. No. 3533
 
 
 
   
 
 
A BILL TO BE ENTITLED
AN ACT
relating to the limit on the rate of growth in appropriations and to
the authority of the comptroller to reduce the state sales tax rate
for designated periods.
       BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
       SECTION 1.  Section 316.001, Government Code, is amended to
read as follows:
       Sec. 316.001.  LIMIT. The rate of growth of appropriations
in a biennium from all available sources of revenue except the
federal government [state tax revenues not dedicated by the
constitution] may not exceed the average rate of growth of this
state's population during the three previous state fiscal bienniums
adjusted by the average rate of monetary inflation over the same
period, as determined under Section 316.002 [estimated rate of
growth of the state's economy].
       SECTION 2.  Sections 316.002(a), (b), (c), and (e),
Government Code, are amended to read as follows:
       (a)  Before the Legislative Budget Board submits the budget
as prescribed by Section 322.008(c) [322.008(b)], the board shall
establish[:
             [(1)]  the limit on the rate of growth in
appropriations for that state fiscal biennium, as compared to the
previous state fiscal biennium, by subtracting one from the product
of:
             (1)  the sum of one and the estimated average rate of
growth of this state's population during the three previous fiscal
bienniums; and
             (2)  the sum of one and the estimated average rate of
monetary inflation during the three previous fiscal bienniums [the
state's economy from the current biennium to the next biennium;
             [(2)  the level of appropriations for the current
biennium from state tax revenues not dedicated by the constitution;
and
             [(3)  the amount of state tax revenues not dedicated by
the constitution that could be appropriated for the next biennium
within the limit established by the estimated rate of growth of the
state's economy].
       (b)  Except as provided by Subsection (c), the board shall
determine for the next state fiscal biennium the maximum
permissible amount of appropriations from all sources of revenue
except the federal government by multiplying the amount of
appropriations from those sources of revenue for the then current
biennium by the sum of one and the limit on the rate of growth of
appropriations determined by the board under Subsection (a) [the
estimated rate of growth of the state's economy by dividing the
estimated Texas total personal income for the next biennium by the
estimated Texas total personal income for the current biennium.  
Using standard statistical methods, the board shall make the
estimate by projecting through the biennium the estimated Texas
total personal income reported by the United States Department of
Commerce or its successor in function].
       (c)  If a more effective method of computing the average
[comprehensive definition of the] rate of growth of the state's
population adjusted for monetary inflation [economy] is developed
and is approved by the committee established by Section 316.005,
the board may use that alternative method in computing [definition
in calculating] the limit on appropriations.
       (e)  In the absence of an action by the Legislative Budget
Board to adopt a spending limit as provided in Subsections (a) and
(b), the limit on the [estimated] rate of growth of appropriations
for the [in the state's economy from the current biennium to the]
next state fiscal biennium is [shall be treated as if it were] zero,
and the amount of revenue from all available sources except the
federal government appropriated for the next state fiscal biennium
may not exceed [state tax revenues not dedicated by the
constitution that could be appropriated within the limit
established by the estimated rate of growth in the state's economy
shall be the same as] the amount [level] of appropriations from
those sources for the then current biennium.
       SECTION 3.  Section 151.051, Tax Code, is amended to read as
follows:
       Sec. 151.051.  SALES TAX IMPOSED. (a)  A tax is imposed on
each sale of a taxable item in this state at a rate determined by the
comptroller as provided by this section.
       (b)  Except as provided by this section, the [The] sales tax
rate is 6-1/4 percent of the sales price of the taxable item sold.
       (c)  Each odd-numbered year, the comptroller shall determine
whether the amount of undedicated unencumbered anticipated revenue
is sufficient to permit, without resulting in a shortfall of
revenue, a reduction of the sales tax rate by at least one-tenth of
one percent for a period of two calendar years.
       (d)  If the comptroller determines under Subsection (c) that
the rate may be reduced, then not later than November 1 of that year
the comptroller shall declare a reduced sales tax rate for the next
two calendar years that is at least one-tenth of one percent lower
than the rate otherwise provided by Subsection (b). The
comptroller shall publish the declaration in the Texas Register,
shall mail notice of the declaration to each permit holder, and may
provide notice by other means the comptroller determines prudent.
The reduced rate applies beginning January 1 of the following year
through December 31 of the second following year, except as
provided by Subsection (e).
       (e)  Not later than November 1 of the first year of the period
to which the reduced sales tax rate applies, the comptroller shall
determine from then current available information whether the
amount of undedicated unencumbered anticipated revenue is
sufficient to maintain the reduced sales tax rate for the second
year of the period without resulting in a shortfall of revenue. If
the comptroller determines that a revenue shortfall is likely to
occur, the comptroller shall declare the reduced rate rescinded for
the following year. The comptroller shall publish the declaration
in the Texas Register, shall mail notice of the declaration to each
permit holder, and may provide notice by other means the
comptroller determines prudent. For the period from January 1 to
December 31 of the year following a declaration under this
subsection, the sales tax rate is the rate otherwise provided by
Subsection (b).
       (f)  The comptroller shall adopt rules to implement this
section.
       SECTION 4.  This Act takes effect on the date on which the
constitutional amendment proposed by the 80th Legislature, Regular
Session, 2007, regarding (1) limiting the rate of growth of
appropriations from all sources of revenue except the federal
government; (2) establishing and funding a disaster fund to be
managed by the governor for use to prepare for or respond to a
natural disaster or emergency; (3) funding the property tax relief
fund; (4) requiring a declaration of an emergency by the governor
before money may be appropriated from the economic stabilization
fund; and (5) authorizing the legislature to appropriate money for
tax rebates to individual taxpayers, takes effect. If that
amendment is not approved by the voters, this Act has no effect.