By: Smith of Tarrant H.B. No. 3462

A BILL TO BE ENTITLED

AN ACT

relating to the rate of the state gasoline tax and diesel fuel taxes and to the permissible uses of the state highway fund.

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

SECTION 1. Section 162.102, Tax Code, is amended to read as follows:

Sec. 162.102. TAX RATE. Except as provided by Section 162.1025, the [The] gasoline tax rate is 20 cents for each net gallon or fractional part on which the tax is imposed under Section 162.101.

SECTION 2. Subchapter B, Chapter 162, Tax Code, is amended by adding Section 162.1025 to read as follows:

Sec. 162.1025. ANNUAL RATE CHANGE ACCORDING TO PRODUCER PRICE INDEX. (a) In this section:

(1) "Producer price index" means the producer price index for highway and street construction published by the United States Department of Labor.

(2) "Producer price index percentage change" means the percentage increase or decrease, not to exceed five percent, in the producer price index of a given state fiscal year from the producer price index of the preceding state fiscal year.

(b) Subject to Subsection (c), on October 1 of each year, the rate of the gasoline tax imposed under this subchapter is increased or decreased by an amount that is equal to the producer price index percentage change for the preceding fiscal year multiplied by the combined rate of the state and federal gasoline taxes on August 1 of that year.

(c) If the computation required by Subsection (b) will result in a tax rate that is less than 20 cents for each net gallon or fractional part on which the tax is imposed under Section 162.101, the comptroller shall set the tax rate at 20 cents.

(d) Not later than September 1 of each year, the comptroller shall:

(1) compute the new tax rate as provided by this section;

(2) give the new tax rate to the secretary of state for publication in the Texas Register; and

(3) notify each license holder under this subchapter of the applicable new tax rate.

SECTION 3. Section 162.103(a), Tax Code, is amended to read as follows:

(a) A backup tax is imposed at the rate prescribed by Sections [Section] 162.102 and 162.1025 on:

(1) a person who obtains a refund of tax on gasoline by claiming the gasoline was used for an off-highway purpose, but actually uses the gasoline to operate a motor vehicle on a public highway;

(2) a person who operates a motor vehicle on a public highway using gasoline on which tax has not been paid; and

(3) a person who sells to the ultimate consumer gasoline on which tax has not been paid and who knew or had reason to know that the gasoline would be used for a taxable purpose.

SECTION 4. Section 162.202, Tax Code, is amended to read as follows:

Sec. 162.202. TAX RATE. Except as provided by Section 162.2025, the [The] diesel fuel tax rate is 20 cents for each net gallon or fractional part on which the tax is imposed under Section 162.201.

SECTION 5. Subchapter C, Chapter 162, Tax Code, is amended by adding Section 162.2025 to read as follows:

Sec. 162.2025. ANNUAL RATE CHANGE ACCORDING TO PRODUCER PRICE INDEX. (a) In this section:

(1) "Producer price index" means the producer price index for highway and street construction published by the United States Department of Labor.

(2) "Producer price index percentage change" means the percentage increase or decrease, not to exceed five percent, in the producer price index of a given state fiscal year from the producer price index of the preceding state fiscal year.

(b) Subject to Subsection (c), on October 1 of each year, the rate of the diesel fuel tax imposed under this subchapter is increased or decreased by an amount that is equal to the producer price index percentage change for the preceding fiscal year multiplied by the combined rate of the state and federal diesel fuel taxes on August 1 of that year.

(c) If the computation required by Subsection (b) will result in a tax rate that is less than 20 cents for each net gallon or fractional part on which the tax is imposed under Section 162.201, the comptroller shall set the tax rate at 20 cents.

(d) Not later than September 1 of each year, the comptroller shall:

(1) compute the new tax rate as provided by this section;

(2) give the new tax rate to the secretary of state for publication in the Texas Register; and

(3) notify each license holder under this subchapter of the applicable new tax rate.

SECTION 6. Section 162.203(a), Tax Code, is amended to read as follows:

(a) A backup tax is imposed at the rate prescribed by Sections [Section] 162.202 and 162.2025 on:

(1) a person who obtains a refund of tax on diesel fuel by claiming the diesel fuel was used for an off-highway purpose, but actually uses the diesel fuel to operate a motor vehicle on a public highway;

(2) a person who operates a motor vehicle on a public highway using diesel fuel on which tax has not been paid; and

(3) a person who sells to the ultimate consumer diesel fuel on which a tax has not been paid and who knew or had reason to know that the diesel fuel would be used for a taxable purpose.

SECTION 7. Section 201.115(d), Transportation Code, is amended to read as follows:

(d) Notwithstanding Section 222.001, money in the state highway fund may be used to repay a loan under this section, if permissible under the Texas Constitution and appropriated by the legislature for that purpose.

SECTION 8. Section 222.001, Transportation Code, is amended to read as follows:

Sec. 222.001. USE OF STATE HIGHWAY FUND. (a) Money that is required to be used for public roadways by the Texas Constitution or federal law and that is deposited in the state treasury to the credit of the state highway fund, including money deposited to the credit of the state highway fund under Title 23, United States Code, may be used only:

(1) to improve the state highway system;

(2) to mitigate adverse environmental effects that result directly from construction or maintenance of a state highway by the department; or

(3) by the Department of Public Safety to [police the state highway system and to] administer state laws relating to traffic and safety on public roads.

(b) Except as otherwise provided by this code, money in the state highway fund that is not described by Subsection (a) may be used only to improve the state highway system.

SECTION 9. Section 222.073, Transportation Code, is amended to read as follows:

Sec. 222.073. PURPOSES OF INFRASTRUCTURE BANK. To the extent permissible under [Notwithstanding] Section 222.001, the commission shall use money deposited in the bank to:

(1) encourage public and private investment in transportation facilities both within and outside of the state highway system, including facilities that contribute to the multimodal and intermodal transportation capabilities of the state; and

(2) develop financing techniques designed to:

(A) expand the availability of funding for transportation projects and to reduce direct state costs;

(B) maximize private and local participation in financing projects; and

(C) improve the efficiency of the state transportation system.

SECTION 10. Section 222.002, Transportation Code, is repealed.

SECTION 11. This Act takes effect only if the constitutional amendment proposed by the 81st Legislature, Regular Session, 2009, limiting the purposes for which revenue from motor vehicle registration fees, taxes on motor fuels and lubricants, and certain revenues received from the federal government may be used and authorizing the legislature to provide for automatic adjustments of the rates of motor fuels taxes is approved by the voters. If that amendment is not approved by the voters, this Act has no effect.

SECTION 12. This Act takes effect September 1, 2011.