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A BILL TO BE ENTITLED
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AN ACT
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relating to tax incentives with respect to certain data centers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter I, Chapter 151, Tax Code, is amended |
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by adding Section 151.4292 to read as follows: |
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Sec. 151.4292. TAX REFUNDS RELATING TO QUALIFYING DATA |
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CENTERS. (a) In this section: |
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(1) "County average weekly wage" means the average |
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weekly wage in a county for all jobs during the most recent four |
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quarterly periods for which data is available, as computed by the |
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Texas Workforce Commission, at the time a data center creates a job |
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used to qualify under this section. |
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(2) "Data center" means a facility: |
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(A) located in this state; |
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(B) composed of a single building or a portion of |
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a single building specifically constructed or refurbished and |
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actually used primarily to house servers and related equipment and |
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support staff for the processing, storage, and distribution of |
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data; and |
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(C) that has an uninterruptible power source, a |
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generator backup power, a sophisticated fire suppression and |
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prevention system, and enhanced physical security that includes |
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restricted access, video surveillance, and electronic systems. |
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(3) "Permanent job" means an employment position that |
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will exist for at least five years after the date the job is |
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created. |
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(4) "Qualifying data center" means a data center that |
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meets the qualifications prescribed by Subsection (d). |
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(5) "Qualifying job" means a full-time, permanent job |
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that pays at least 120 percent of the county average weekly wage in |
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the county in which the job is based. |
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(6) "Qualifying operator" means a person who controls |
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access to a qualifying data center, regardless of whether that |
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person owns each item of tangible personal property located at the |
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data center. |
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(7) "Qualifying tenant" means a person who contracts |
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with a qualifying operator to place, or cause to be placed, and to |
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use tangible personal property at a qualifying data center. |
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(b) Except as provided by Subsection (c), a qualifying data |
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center, a qualifying operator, and a qualifying tenant are entitled |
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to receive a refund in the amount provided by this section of the |
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taxes imposed on the purchase of tangible personal property that is |
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necessary to manage or operate the data center, including: |
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(1) electricity; |
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(2) an electrical system; |
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(3) a cooling system; |
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(4) an emergency generator; |
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(5) hardware or a distributed mainframe computer or |
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server; |
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(6) a data storage device; |
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(7) network connectivity equipment; |
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(8) a rack, cabinet, and raised floor system; |
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(9) a peripheral component or system; |
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(10) software; |
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(11) a mechanical, electrical, or plumbing system that |
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is necessary to operate any tangible personal property described by |
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Subdivisions (2)-(10); |
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(12) any other item of equipment or system necessary |
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to operate any tangible personal property described by Subdivisions |
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(2)-(11), including a fixture; and |
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(13) a component part of any tangible personal |
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property described by Subdivisions (2)-(10). |
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(c) This section does not apply to: |
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(1) office equipment or supplies; |
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(2) equipment or supplies used primarily in sales or |
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distribution activities or in transportation activities; or |
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(3) tangible personal property purchased by an |
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applicant for a refund under this section with respect to which the |
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applicant received or has a pending application for a refund under |
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Section 151.429. |
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(d) A data center is eligible to be a qualifying data center |
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for purposes of this section if the data center, an operator of the |
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data center, or a tenant of the data center, independently or as a |
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group: |
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(1) creates at least 20 qualifying jobs in the county |
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in which the data center is located; and |
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(2) makes or agrees to make a capital investment, on or |
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after September 1, 2013, of at least $150 million in this state |
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related to improvements to real and tangible personal property |
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installed at the data center over a four-year period after initial |
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construction or refurbishing of the data center facility. |
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(e) A data center may apply to the comptroller for |
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qualification as a qualifying data center. The application must be |
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made on a form prescribed by the comptroller and include the |
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information required by the comptroller. The application form must |
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include a section for the data center to certify that the data |
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center, an operator of the data center, or a tenant of the data |
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center, independently or as a group, will make the investment |
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required by Subsection (d)(2). |
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(f) Beginning on the date a data center becomes a qualifying |
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data center, the data center, a qualifying operator of the data |
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center, and a qualifying tenant of the data center are entitled to |
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receive a refund as provided by this section on an annual basis as |
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provided by Subsection (j) for the purchase of tangible personal |
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property occurring on or after that date and before: |
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(1) the 10th anniversary of the date the data center |
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becomes a qualifying data center, if the data center, operator, or |
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tenant makes a capital investment of at least $150 million but less |
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than $200 million as provided by Subsection (d)(2); or |
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(2) the 15th anniversary of the date the data center |
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becomes a qualifying data center, if the data center, operator, or |
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tenant makes a capital investment of $200 million or more as |
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provided by Subsection (d)(2). |
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(g) The amount of the refund authorized by this section for |
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each annual period with respect to the taxes imposed on the purchase |
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during that period of an item of tangible personal property to which |
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this section applies is equal to the greater of: |
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(1) an amount equal to the amount by which the taxes |
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paid under this chapter exceed the amount of taxes that would have |
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been imposed under this chapter on the purchase of the item if the |
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rate of the tax imposed under this chapter were one percent; or |
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(2) the amount by which the taxes paid under this |
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chapter exceed $80. |
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(h) To receive a refund as provided by this section, a data |
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center must apply to the comptroller. |
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(i) The comptroller shall adopt rules necessary to |
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implement this section, including rules relating to the: |
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(1) qualification and disqualification of a data |
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center, operator, or tenant under this section; |
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(2) determination of the date a data center, operator, |
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or tenant initially qualifies for a refund as provided by this |
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section; and |
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(3) reporting and other procedures necessary to ensure |
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that a qualifying data center, qualifying operator, and qualifying |
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tenant comply with this section and remain entitled to receive a |
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refund as provided by this section. |
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(j) The rules adopted by the comptroller under Subsection |
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(i) must allow for a qualifying data center, qualifying operator, |
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or qualifying tenant to apply for and receive annually the refund |
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provided under this section. The rules must prescribe the period |
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each year during which an application may be filed requesting a |
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refund of taxes imposed and paid during the preceding state fiscal |
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year. |
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SECTION 2. Section 313.024(b), Tax Code, is amended to read |
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as follows: |
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(b) To be eligible for a limitation on appraised value under |
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this subchapter, the entity must use the property in connection |
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with: |
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(1) manufacturing; |
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(2) research and development; |
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(3) a clean coal project, as defined by Section 5.001, |
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Water Code; |
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(4) an advanced clean energy project, as defined by |
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Section 382.003, Health and Safety Code; |
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(5) renewable energy electric generation; |
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(6) electric power generation using integrated |
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gasification combined cycle technology; |
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(7) nuclear electric power generation; [or] |
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(8) a computer center primarily used in connection |
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with one or more activities described by Subdivisions (1) through |
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(7) conducted by the entity; or |
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(9) a data center that is eligible to receive a tax |
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refund under Section 151.4292. |
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SECTION 3. The change in law made by this Act does not |
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affect tax liability accruing before the effective date of this |
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Act. That liability continues in effect as if this Act had not been |
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enacted, and the former law is continued in effect for the |
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collection of taxes due and for civil and criminal enforcement of |
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the liability for those taxes. |
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SECTION 4. This Act takes effect September 1, 2013. |