82R420 JTS-D

By: Pickett H.B. No. 629

A BILL TO BE ENTITLED

AN ACT

relating to the use of municipal or county sales tax increment

financing for a transportation reinvestment zone.

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

SECTION 1. Section 222.106(g), Transportation Code, is

amended to read as follows:

(g) The ordinance designating an area as a transportation

reinvestment zone must:

(1) describe the boundaries of the zone with

sufficient definiteness to identify with ordinary and reasonable

certainty the territory included in the zone;

(2) provide that the zone takes effect immediately on

passage of the ordinance;

(3) assign a name to the zone for identification, with

the first zone designated by a municipality designated as

"Transportation Reinvestment Zone Number One, (City or Town, as

applicable) of (name of municipality)," and subsequently

designated zones assigned names in the same form, numbered

consecutively in the order of their designation;

(4) establish a [an ad valorem] tax increment account

for the zone; and

(5) contain findings that promotion of the

transportation project will cultivate development or redevelopment

of the zone.

SECTION 2. Subchapter E, Chapter 222, Transportation Code,

is amended by adding Section 222.108 to read as follows:

Sec. 222.108. SALES TAX INCREMENT. (a) In this section,

"sales tax base" for a transportation reinvestment zone means the

amount of sales and use taxes imposed by a municipality under

Section 321.101(a), Tax Code, or by a county under Chapter 323, Tax

Code, as applicable, attributable to the zone for the year in which

the zone was designated under this chapter.

(b) The governing body of a municipality or county may

determine, in an ordinance or order designating an area as a

transportation reinvestment zone or in an ordinance or order

adopted subsequent to the designation of a zone, the portion or

amount of tax increment generated from the sales and use taxes

imposed by a municipality under Section 321.101(a), Tax Code, or by

a county under Chapter 323, Tax Code, attributable to the zone,

above the sales tax base, to be used as provided by Subsection (e).

Nothing in this section requires a municipality or county to

contribute sales tax increment under this subsection.

(c) A county that designates a portion or amount of sales

tax increment under Subsection (b) must establish a tax increment

account. A municipality or county shall deposit the designated

portion or amount of tax increment under Subsection (b) to their

respective tax increment account.

(d) Before pledging or otherwise committing money in the tax

increment account under Subsection (c), the governing body of a

municipality or county may enter into an agreement, under

Subchapter E, Chapter 271, Local Government Code, to authorize and

direct the comptroller to:

(1) withhold from any payment to which the

municipality or county may be entitled the amount of the payment

into the tax increment account under Subsection (b);

(2) deposit that amount into the tax increment

account; and

(3) continue withholding and making additional

payments into the tax increment account until an amount sufficient

to satisfy the amount due has been met.

(e) The sales and use taxes to be deposited into the tax

increment account under this section may be disbursed from the

account only to:

(1) pay for projects authorized under Section 222.104,

including the repayment of amounts owed under an agreement entered

into under that section; and

(2) notwithstanding Sections 321.506 and 323.505, Tax

Code, satisfy claims of holders of tax increment bonds, notes, or

other obligations issued or incurred for projects authorized under

Section 222.104.

(f) The amount deposited by a county to a tax increment

account under this section is not considered to be sales and use tax

revenue for the purpose of property tax reduction and computation

of the county tax rate under Section 26.041, Tax Code.

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, 2011.