By: Hinojosa S.B. No. 1084
 
  (Murphy)
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the enterprise zone program.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 2303.003, Government Code, is amended by
  amending Subdivision (7) and adding Subdivision (9) to read as
  follows:
               (7)  "Qualified employee" means a person who:
                     (A)  works for a qualified business; [and]
                     (B)  receives wages from the qualified business
  from which employment taxes are deducted; and
                     (C)  performs at least 50 percent of the person's
  service for the business at the qualified business site, or if the
  person engages in the transportation of goods or services, the
  person reports to the qualified business site and resides within 50
  miles of the qualified business site.
               (9)  "Veteran" means a person who:
                     (A)  has served in:
                           (i)  the army, navy, air force, coast guard,
  or marine corps of the United States;
                           (ii)  the state military forces as defined
  by Section 431.001; or
                           (iii)  an auxiliary service of one of those
  branches of the armed forces; and
                     (B)  has been honorably discharged from the branch
  of the service in which the person served.
         SECTION 2.  Section 2303.004, Government Code, is amended by
  amending Subsection (b) and adding Subsection (c) to read as
  follows:
         (b)  Notwithstanding Subsection (a), the governing body of a
  county [with a population of one million or more] may nominate for
  designation as an enterprise project a project or activity of a
  qualified business that is located within the jurisdiction of a
  municipality located in the county.  [For purposes of this
  subsection, a county during any biennium may not use in any one
  municipality more than three of the maximum number of designations
  the county is permitted under Section 2303.406(d)(2).]
         (c)  Before a county makes a nomination under Subsection (b),
  the nominating county must enter into an interlocal agreement with
  the municipality that has jurisdiction of the territory in which
  the nominated project or activity will be located.  The interlocal
  agreement must specify that either the nominating county or the
  municipality that has jurisdiction of the territory in which the
  nominated project or activity will be located is the governmental
  body having administration authority under Section 2303.201 and
  that both the nominating county and municipality approve the
  nomination. For purposes of this subsection, a county during any
  biennium may use the maximum number of designations the county is
  permitted under Section 2303.406(d) within the territory described
  by this subsection.
         SECTION 3.  Section 2303.201, Government Code, is amended to
  read as follows:
         Sec. 2303.201.  ADMINISTRATION BY GOVERNING BODY. (a)  The
  governing body of an enterprise zone is the governing body of the
  municipality or county with jurisdiction over the area designated
  as an enterprise zone, except as provided by Subsection (b).
         (b)  The governing body with administration authority over
  an enterprise project nominated under Section 2303.004(c) is
  determined under the terms of an interlocal agreement required by
  that subsection.
         SECTION 4.  Subsection (a), Section 2303.402, Government
  Code, is amended to read as follows:
         (a)  A person is a qualified business if the bank, for the
  purpose of state benefits under this chapter, or the nominating
  body of a project or activity of the person under this chapter, for
  the purpose of local incentives, certifies that:
               (1)  the person is engaged in or has provided
  substantial commitment to initiate the active conduct of a trade or
  business in an enterprise zone, and at least 25 percent of the
  person's new permanent jobs [employees] in the enterprise zone are
  held by:
                     (A)  residents of any enterprise zone in this
  state; [or]
                     (B)  economically disadvantaged individuals; or
                     (C)  veterans; or
               (2)  the person is engaged in or has provided
  substantial commitment to initiate the active conduct of a trade or
  business in an area of this state that does not qualify as an
  enterprise zone, and at least 35 percent of the person's new
  permanent jobs [employees] at the qualified business site are held
  by:
                     (A)  residents of any enterprise zone in this
  state; [or]
                     (B)  individuals who are economically
  disadvantaged; or
                     (C)  veterans.
         SECTION 5.  Section 2303.4052, Government Code, is amended
  to read as follows:
         Sec. 2303.4052.  REQUIRED INFORMATION FROM NOMINATING BODY.
  Before nominating the project or activity of a qualified business
  for designation as an enterprise project, the nominating body must
  submit to the bank:
               (1)  a certified copy of the ordinance or order, as
  appropriate, or reference to an ordinance or order as required by
  Section 2303.4051;
               (2)  a certified copy of the minutes [transcript] of
  all public hearings conducted with respect to local incentives
  available to qualified businesses within the jurisdiction of the
  governmental entity nominating the project or activity, regardless
  of whether those businesses are located in an enterprise zone;
               (3)  the name, title, address, telephone number, and
  electronic mail address of the nominating body's liaison designated
  under Section 2303.204;
               (4)  if the business is seeking job retention benefits,
  documentation showing the number of employment positions at the
  qualified business site; [and]
               (5)  any interlocal agreement required under Section
  2303.004(c) that states:
                     (A)  which governing body has the administration
  authority under Section 2303.201; and
                     (B)  that both the county in which the project or
  activity is located and the municipality in whose jurisdiction the
  project or activity is located approve the nomination of the
  project or activity; and
               (6)  any additional information the bank may require.
         SECTION 6.  Section 2303.406, Government Code, is amended by
  amending Subsections (b) and (e) and adding Subsection (d-1) to
  read as follows:
         (b)  [This subsection does not apply to a qualified business
  located in a federally designated zone, as described by Section
  2303.101(2), which will receive priority designation in allocating
  the number of enterprise projects allowed statewide per biennium as
  provided by Section 2303.403.]  The bank shall designate qualified
  businesses as enterprise projects on a competitive basis. The bank
  shall make its designation decisions using a weighted scale in
  which:
               (1)  40 percent of the evaluation depends on the
  economic distress of the block group or distressed county in which a
  proposed enterprise project is located;
               (2)  25 percent of the evaluation depends on the local
  effort to achieve development and revitalization of the block group
  or distressed county in which a proposed enterprise project is
  located; and
               (3)  35 percent of the evaluation depends on the
  evaluation criteria as determined by the bank, which must include:
                     (A)  with respect to a proposed enterprise project
  located in a block group, the level of cooperation and support the
  project applicant commits to the revitalization goals of all of the
  enterprise zone block groups within the jurisdiction of the
  nominating governmental entity;
                     (B)  with respect to a proposed enterprise project
  located in a distressed county, the level of cooperation and
  support the project applicant commits to the revitalization of the
  distressed county; and
                     (C)  the type and wage level of the jobs to be
  created or retained by the business.
         (d-1)  An enterprise project designation may be split into
  two half designations.  A half designation uses one-half of one of
  the enterprise project designations allowed to a nominating body
  under Subsection (d) and to the bank under Section 2303.403.
         (e)  The office may not[, during any biennium,] designate
  multiple concurrent enterprise projects to a qualified business
  located at a qualified business site.
         SECTION 7.  Section 2303.407, Government Code, is amended by
  amending Subsections (b), (c), and (d) and adding Subsections (e)
  and (f) to read as follows:
         (b)  A capital investment in a project of:
               (1)  $40,000 to $399,999 will result in a refund of up
  to $2,500 per job with a maximum refund of $25,000 for the creation
  or retention of 10 jobs;
               (2)  $400,000 to $999,999 will result in a refund of up
  to $2,500 per job with a maximum refund of $62,500 for the creation
  or retention of 25 jobs;
               (3)  $1,000,000 to $4,999,999 will result in a refund
  of up to $2,500 per job with a maximum refund of $312,500 for the
  creation or retention of 125 jobs;
               (4)  $5,000,000 or more [to $149,999,999] will result
  in a refund of up to $2,500 per job with a maximum refund of
  $1,250,000 for the creation or retention of 500 jobs, except as
  provided by Subdivision (5) or (6);
               (5)  $150,000,000 to $249,999,999 will result in a
  refund of up to $5,000 per new permanent job with a maximum refund
  of $2,500,000 for the creation [or retention] of 500 new permanent 
  jobs if the bank designates the project as a double jumbo enterprise
  project; or
               (6)  $250,000,000 or more will result in a refund of up
  to $7,500 per new permanent job with a maximum refund of $3,750,000
  for the creation [or retention] of at least 500 new permanent jobs
  if the bank designates the project as a triple jumbo enterprise
  project.
         (c)  An enterprise project for which a commitment for a
  capital investment in the range amount and the creation [or
  retention] of the number of new permanent jobs specified by
  Subsection (b)(5) is made is considered a double jumbo enterprise
  project if the project is so designated by the bank.  The bank may
  not designate a project as a double jumbo enterprise project after
  the initial designation period approved by the bank under Section
  2303.404(b).
         (d)  An enterprise project for which a commitment for a
  capital investment in the range amount and the creation [or
  retention] of the number of new permanent jobs specified by
  Subsection (b)(6) is made is considered a triple jumbo enterprise
  project if the project is so designated by the bank.  The bank may
  not designate a project as a triple jumbo enterprise project after
  the initial designation period approved by the bank under Section
  2303.404(b).
         (e)  A state-mandated or federally mandated capital
  investment, including an investment in pollution abatement
  equipment, does not qualify as a committed capital investment in an
  enterprise project under this chapter.
         (f)  The maximum number of jobs that the bank may allocate to
  an enterprise project split into two half designations as provided
  by Section 2303.406(d-1) is 250.
         SECTION 8.  Section 2303.4071, Government Code, is amended
  by amending Subsection (a) and adding Subsection (e) to read as
  follows:
         (a)  In this section:
               (1)  "Double[, "double] jumbo enterprise project" and
  "triple jumbo enterprise project" have the meanings assigned by
  Section 2303.407.
               (2)  "Half enterprise project" means an enterprise
  project split into two half designations as provided by Section
  2303.406(d-1).
         (e)  A half enterprise project is eligible for a maximum
  refund not to exceed $125,000 in each state fiscal year and is
  subject to the capital investment and job allocation requirements
  under Section 2303.407(b)(1), (2), or (3).
         SECTION 9.  Section 2303.504, Government Code, is amended to
  read as follows:
         Sec. 2303.504.  STATE TAX REFUNDS [AND CREDITS]; REPORT.  
  (a)  Subject to Section 2303.516, an enterprise project is entitled
  to[:
               [(1)]  a refund of state taxes under Section 151.429,
  Tax Code[; and
               [(2)     a franchise tax credit under Subchapter Q-1,
  Chapter 171, Tax Code].
         (b)  At the time of receipt of any tax benefit available as a
  result of participating in the enterprise zone program, including a
  state sales and use tax refund [or franchise tax credit], three
  percent of the amount of the tax benefit shall be transferred to the
  Texas economic development bank fund under Subchapter B, Chapter
  489, to defray the cost of administering this chapter.
         (c)  Not later than the 60th day after the last day of each
  fiscal year, the comptroller shall report to the bank the statewide
  total of actual jobs created, actual jobs retained, and the tax
  refunds [and credits] made under this section during that fiscal
  year.
         SECTION 10.  Subsection (b), Section 2303.516, Government
  Code, is amended to read as follows:
         (b)  The comptroller may determine that the business or
  project is not entitled to a refund [or credit] of state taxes under
  Section 2303.504 if the comptroller finds that:
               (1)  the business or project is not willing to
  cooperate with the comptroller in providing the comptroller with
  the information the comptroller needs to determine the state
  benefits; or
               (2)  the business or project has substantially failed
  to follow through on any commitments made by it or on its behalf
  under this chapter.
         SECTION 11.  Section 151.429, Tax Code, is amended by
  amending Subsections (b) and (c) and adding Subsection (k) to read
  as follows:
         (b)  Subject to the limitations provided by Subsection (c) of
  this section, an enterprise project qualifies for a refund of taxes
  under this section based on the amount of capital investment made at
  the qualified business site, the project's designation level, and
  the refund per job with a maximum refund to be included in a
  computation of a tax refund for the project.  A capital investment
  at the qualified business site of:
               (1)  $40,000 to $399,999 will result in a refund of up
  to $2,500 per job with a maximum refund of $25,000 for the creation
  or retention of 10 jobs;
               (2)  $400,000 to $999,999 will result in a refund of up
  to $2,500 per job with a maximum refund of $62,500 for the creation
  or retention of 25 jobs;
               (3)  $1,000,000 to $4,999,999 will result in a refund
  of up to $2,500 per job with a maximum refund of $312,500 for the
  creation or retention of 125 jobs;
               (4)  $5,000,000 or more [to $149,999,999] will result
  in a refund of up to $2,500 per job with a maximum refund of
  $1,250,000 for the creation or retention of 500 jobs, except as
  provided by Subdivision (5) or (6);
               (5)  $150,000,000 to $249,999,999 will result in a
  refund of up to $5,000 per new permanent job with a maximum refund
  of $2,500,000 for the creation [or retention] of 500 new permanent
  jobs if the Texas Economic Development Bank designates the project
  as a double jumbo enterprise project; or
               (6)  $250,000,000 or more will result in a refund of up
  to $7,500 per new permanent job with a maximum refund of $3,750,000
  for the creation [or retention] of at least 500 new permanent jobs
  if the Texas Economic Development Bank designates the project as a
  triple jumbo enterprise project.
         (c)  The total amount of tax refund that an enterprise
  project may apply for in a state fiscal year may not exceed
  $250,000, at not more than $2,500 per job.  The total amount of tax
  refund that a double jumbo enterprise project may apply for in a
  state fiscal year may not exceed $500,000, at not more than $5,000
  per new permanent job.  The total amount of tax refund that a triple
  jumbo enterprise project may apply for in a state fiscal year may
  not exceed $750,000, at not more than $7,500 per new permanent job.  
  If an enterprise project, double jumbo enterprise project, or
  triple jumbo enterprise project qualifies in a state fiscal year
  for a refund of taxes in an amount in excess of the applicable
  limitation provided by this subsection, it may apply for a refund of
  those taxes in a subsequent year, subject to the applicable
  limitation for each year.  The total amount that may be refunded to:
               (1)  an enterprise project under this section may not
  exceed the amount determined by multiplying $250,000 by the number
  of state fiscal years during which the enterprise project created
  or retained one or more jobs for qualified employees;
               (2)  a double jumbo enterprise project under this
  section may not exceed the amount determined by multiplying
  $500,000 by the number of state fiscal years during which the double
  jumbo enterprise project created [or retained] one or more new
  permanent jobs for qualified employees; or
               (3)  a triple jumbo enterprise project under this
  section may not exceed the amount determined by multiplying
  $750,000 by the number of state fiscal years during which the triple
  jumbo enterprise project created [or retained] one or more new
  permanent jobs for qualified employees.
         (k)  A half enterprise project is eligible for a maximum
  refund not to exceed $125,000 in each state fiscal year and is
  subject to the capital investment and job allocation requirements
  under Subsection (b)(1), (2), or (3).
         SECTION 12.  Subsection (e), Section 151.429, Tax Code, is
  amended by adding Subdivision (6) to read as follows:
               (6)  "Half enterprise project" means an enterprise
  project split into two half designations as provided by Section
  2303.406(d-1), Government Code.
         SECTION 13.  Subsection (b), Section 2303.109, Government
  Code, is repealed.
         SECTION 14.  (a)  The changes in law made by this Act to
  Subsection (a), Section 2303.402, Government Code, apply only to an
  application for a designation of an enterprise project under the
  enterprise zone program under Chapter 2303, Government Code, as
  amended by this Act, filed on or after the effective date of this
  Act. An application for designation of an enterprise project under
  the enterprise zone program filed before the effective date of this
  Act is governed by the law in effect on the date the application was
  filed, and the former law is continued in effect for that purpose.
         (b)  The changes in law made by this Act to Section 2303.407,
  Government Code, and Section 151.429, Tax Code, apply only to an
  enterprise project designation made on or after the effective date
  of this Act. An enterprise project designation made before the
  effective date of this Act is governed by the law in effect when the
  designation was made, and the former law is continued in effect for
  that purpose.
         SECTION 15.  This Act takes effect September 1, 2013.