80R2863 T

By: Krusee H.B. No. 3722

A BILL TO BE ENTITLED

AN ACT

relating to pass-through financing and the creation and operation of the Transportation Reinvestment Fund.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. The heading to Section 222.104, Transportation Code, is amended to read as follows:

Sec. 222.104. PASS-THROUGH [TOLLS] FINANCING.

SECTION 2. Subchapter E, Chapter 222, Transportation Code, is amended by adding Section 222.105 to read as follows:

Sec. 222.105. CREATION OF THE TRANSPORTATION REINVESTMENT FUND. (a) The Transportation Reinvestment Fund is an account in the state treasury.

(b) The fund is administered by the comptroller for the benefit of the plan established under section 222.106 of this chapter. The fund is exempt from the application of Section 403.095, Government Code. Interest earned on the fund shall be credited to the fund.

(c) The fund consists of revenue collected under Section 222.106 of this chapter. Any revenue deposited to this account shall be limited to use in the geographic regions described in Sections 222.106 and 222.107 for the sole purpose of providing funding for projects authorized under Section 222.104 as determined by the department.

SECTION 3. Subchapter E, Chapter 222, Transportation Code, is amended by adding Section 222.106 to read as follows:

Sec. 222.106. CREATION OF TRANSPORTATION REINVESTMENT ZONES BY A MUNICIPALITY. (a) The governing body of a municipality which has entered into a pass-through toll agreement with the department may by ordinance designate a contiguous geographic area within its jurisdiction to be a Transportation Reinvestment Zone to promote transportation projects authorized under Section 222.104 which cultivate development or redevelopment of an area the governing body determines to be unproductive, underdeveloped, or blighted. In making this determination the governing body of the municipality may utilize the criteria defined in Tax Code Section 311.005(a) or may utilize its own criteria that reasonably support a finding that an area is unproductive, underdeveloped, or blighted.

(b) Not later than the seventh day before the adoption of the ordinance referred to in subsection (a), the governing body of the municipality must hold a public hearing on the creation of the zone and its benefits to the municipality and to property in the proposed zone. Notice of the public hearing must be published in a newspaper of general circulation in the municipality not later than the seventh day before the public hearing. Designation of an area as a Transportation Reinvestment Zone by adoption of an ordinance constitutes designation of the area as a reinvestment zone under Chapters 311 and 312, Tax Code, without further hearings or procedural requirements.

(c) For property located within a Transportation Reinvestment Zone the municipality may determine the increase in assessed property value resulting from the transportation project developed through a pass-through financing agreement with the department under Section 222.104.

(d) A municipality may, by affirmative vote of its governing body, dedicate the tax increment to reimburse up to fifty percent of the aggregate amount of pass-through toll payments made by the department to the municipality pursuant to an agreement under Section 222.104. All reimbursements collected under this section must be deposited to the credit of the Transportation Reinvestment Fund to be used only for purposes identified in Section 222.105 and only within the department district where the zone is located. The maximum duration for the existence of a zone created hereunder shall be for a term of years from the date of the ordinance creating the zone until the obligation to reimburse the department pursuant to an agreement under Section 222.104 has been satisfied.

SECTION 4. Subchapter E, Chapter 222, Transportation Code, is amended by adding Section 222.107 to read as follows:

Sec. 222.107. TAX ABATEMENTS AND RELATED ACTIONS OF A COUNTY. (a) The commissioners court of a county which has entered into a pass-through financing agreement with the department may by ordinance or other official action designate a contiguous geographic area within its jurisdiction to be a Transportation Reinvestment Zone within which certain ad valorem taxes may be abated to promote transportation projects authorized under sec. 222.104 which encourage development or redevelopment and improvement of the property.

(b) Not later than the seventh day before the adoption of the ordinance or other official action referred to in subsection (a), the commissioners court must hold a public hearing on the creation of the zone, the abatement of taxes, and benefits to the county and to property in the proposed zone. Notice of the public hearing must be published in a newspaper of general circulation in the county not later than the seventh day before the public hearing and must be delivered in writing to the presiding officer of the governing body of each taxing unit that includes in its boundaries property to be located in the zone. Notice is deemed delivered when mailed. Designation of an area as a Transportation Reinvestment Zone by adoption of an ordinance or other official action constitutes designation of the area as a reinvestment zone under Chapters 311 and 312, Tax Code, without further hearings or procedural requirements. Notice of the adoption of an ordinance or other official action regarding an abatement of taxes must be delivered in writing to the presiding officer of the governing body of each taxing unit that includes in its boundaries property to be located in the zone. Notice is deemed delivered when mailed.

(c) For property within a Transportation Reinvestment Zone a county may determine the increase in assessed property value resulting from the transportation project developed through a pass-through financing agreement with the department, and may agree to abate a portion of the increment of ad valorem taxes attributable to the increased value.

(d) Notwithstanding any law to the contrary, including without limitation Tax Code, Chapter 312, an agreement to abate taxes within a zone created under this section does not require a separate agreement with each property owner. The abatement of taxes may last no longer than the period required for a road utility district to satisfy any obligation to reimburse the department for a portion of the pass-through financing provided to the county under an agreement under Section 222.104.

(e) In order to assist a county in satisfying its obligations under a pass-through financing agreement with the department under Section 222.104 a road utility district may be formed under Transportation Code Chapter 441 with the same geographic boundaries as a zone created under this section.

(f) A road utility district formed with the same geographic boundaries as a zone created under this section may impose a tax on property within the zone at a rate which does not exceed the amount of ad valorem taxes abated under an agreement of the county under subsection (c).

(g) A road utility district formed for the purpose set forth in subsection (e) may assume the obligations, if any, of a county to make payments to the department to reimburse up to fifty percent of funding provided to the county under a pass-through financing agreement. Such payments shall be considered an operating expense of the district. All reimbursement payments received by the department under this section must be deposited to the credit to the Transportation Reinvestment Fund to be used within the department district where the zone is located for any purpose identified in Section 222.105. The obligation to make such payments shall cease when the amount to be reimbursed to the department has been paid or, if sooner, when the period of the abatement under subsection (d) terminates.

SECTION 5. 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, 2007.