83R20620 TJB-D
 
  By: Harper-Brown, Ratliff, Hilderbran H.B. No. 3121
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the qualifications for the exemption from ad valorem
  taxation for aircraft parts located in this state for a limited
  time.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 11.251, Tax Code, is amended by amending
  Subsections (b), (c), (e), (g), and (k) and adding Subsection (l) to
  read as follows:
         (b)  A person is entitled to an exemption from taxation by a
  taxing unit of the appraised value of that portion of the person's
  inventory or property consisting of freeport goods as determined
  under this section for the taxing unit.
         (c)  The exemption provided by Subsection (b) is subtracted
  from the market value of the inventory or property determined under
  Section 23.12 to determine the taxable value of the inventory or
  property for the taxing unit.
         (e)  In determining the market value of freeport goods that
  in the preceding year were assembled, manufactured, repaired,
  maintained, processed, or fabricated in this state or used by the
  person who acquired or imported the property in the repair or
  maintenance of aircraft operated by a certificated air carrier, the
  chief appraiser shall exclude the cost of equipment, machinery, or
  materials that entered into and became component parts of the
  freeport goods but were not themselves freeport goods or that were
  not transported outside the state before the expiration of 175
  days, or, if applicable, the greater number of days adopted by the
  taxing unit as authorized by Subsection (l), after they were
  brought into this state by the property owner or acquired by the
  property owner in this state. For component parts held in bulk, the
  chief appraiser may use the average length of time a component part
  was held in this state by the property owner during the preceding
  year in determining whether the component parts were transported
  out of this state before the expiration of 175 days or, if
  applicable, the greater number of days adopted by the taxing unit as
  authorized by Subsection (l).
         (g)  If the property owner or the chief appraiser
  demonstrates that the method provided by Subsection (d)
  significantly understates or overstates the market value of the
  property qualified for an exemption under Subsection (b) in the
  current year, the chief appraiser shall determine the market value
  of the freeport goods to be exempt by determining, according to the
  property owner's records and any other available information, the
  market value of those freeport goods owned by the property owner on
  January 1 of the current year, excluding the cost of equipment,
  machinery, or materials that entered into and became component
  parts of the freeport goods but were not themselves freeport goods
  or that were not transported outside the state before the
  expiration of 175 days, or, if applicable, the greater number of
  days adopted by the taxing unit as authorized by Subsection (l),
  after they were brought into this state by the property owner or
  acquired by the property owner in this state.
         (k)  Property that meets the requirements of Article VIII,
  Sections 1-j(a)(1) and (2), of the Texas Constitution and that is
  transported outside of this state not later than 175 days, or, if
  applicable, the greater number of days adopted by the taxing unit as
  authorized by Subsection (l), after the date the person who owns it
  on January 1 acquired it or imported it into this state is freeport
  goods regardless of whether the person who owns it on January 1 is
  the person who transports it outside of this state.
         (l)  The governing body of a taxing unit, in the manner
  provided by law for official action, may extend the date by which
  freeport goods that are aircraft parts must be transported outside
  the state to a date not later than the 730th day after the date the
  person acquired or imported the property in this state.  An
  extension adopted by official action under this subsection applies
  only to the exemption from ad valorem taxation by the taxing unit
  adopting the extension and applies to:
               (1)  the tax year:
                     (A)  in which the extension is adopted if
  officially adopted before June 1 of a tax year; or
                     (B)  immediately following the tax year in which
  the extension is adopted if officially adopted on or after June 1 of
  a tax year; and
               (2)  each tax year following the year of adoption of the
  extension.
         SECTION 2.  This Act applies only to a tax year beginning on
  or after the effective date of this Act.
         SECTION 3.  This Act takes effect January 1, 2014, but only
  if the constitutional amendment proposed by the 83rd Legislature,
  Regular Session, 2013, to authorize a political subdivision of this
  state to extend the number of days that aircraft parts that are
  exempt from ad valorem taxation due to their location in this state
  for a temporary period may be located in this state for purposes of
  qualifying for the tax exemption is approved by the voters. If that
  amendment is not approved by the voters, this Act has no effect.