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AN ACT
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relating to a single local use tax rate as an alternative to |
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combined local use tax rates for computing the amount of local use |
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taxes remote sellers are required to collect and to the allocation |
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of tax revenue collected at that rate. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. The purpose of this Act is to provide an |
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optional, simplified means of computing the amount of local use tax |
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remote sellers are required to collect following the decision of |
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the United States Supreme Court in South Dakota v. Wayfair, Inc., |
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138 S. Ct. 2080 (2018). |
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SECTION 2. Subchapter C, Chapter 151, Tax Code, is amended |
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by adding Section 151.0595 to read as follows: |
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Sec. 151.0595. SINGLE LOCAL TAX RATE FOR REMOTE SELLERS. |
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(a) In this section, "remote seller" means a seller whose only |
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activities in this state are described by Section 151.107(a)(4) or |
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(5). |
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(b) A remote seller required to collect and remit one or |
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more local use taxes in connection with a sale of a taxable item |
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made by the remote seller shall compute the amount to collect and |
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remit using: |
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(1) the combined rate of all applicable local use |
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taxes authorized or governed by Title 3; or |
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(2) at the remote seller's election, the single local |
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use tax rate published in the Texas Register as required by |
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Subsection (d). |
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(c) A remote seller who elects under Subsection (b)(2) to |
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use the single local use tax rate shall notify the comptroller of |
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the election before using that rate. The election applies to all |
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sales of taxable items made by the remote seller unless the remote |
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seller revokes the election by notifying the comptroller. Notice to |
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the comptroller under this subsection must be in the form and manner |
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provided by the comptroller. |
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(d) The single local use tax rate effective in a calendar |
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year is equal to the estimated average rate of local sales and use |
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taxes imposed in this state during the preceding state fiscal year, |
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as determined under Subsection (e). Before the beginning of a |
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calendar year, the comptroller shall publish in the Texas Register |
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notice of the single local use tax rate that will be in effect for |
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that calendar year. |
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(e) As soon as practicable after the end of a state fiscal |
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year, the comptroller shall determine the estimated average rate of |
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local sales and use taxes imposed in this state during the preceding |
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state fiscal year by: |
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(1) dividing the total amount of net local sales and |
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use taxes remitted to the comptroller under this section and Title 3 |
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during that state fiscal year by the total amount of net state sales |
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and use taxes remitted to the comptroller under this chapter during |
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that state fiscal year; |
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(2) multiplying the amount computed under Subdivision |
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(1) by the rate provided by Section 151.051; and |
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(3) rounding the amount computed under Subdivision (2) |
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to the nearest .0025. |
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(f) Notwithstanding Section 111.104(b), a purchaser may |
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annually apply for a refund of any amount by which the amount of use |
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tax computed using the rate described by Subsection (b)(2) and paid |
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by the purchaser exceeds the amount the purchaser would have paid if |
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that tax had been computed using the rate described by Subsection |
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(b)(1). The comptroller may adopt rules regarding the procedure |
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and proof required for the refund. |
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(g) A person storing, using, or consuming in this state a |
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taxable item purchased from a remote seller is not liable for any |
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additional amount of local use tax authorized or governed by Title 3 |
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if the remote seller elects under Subsection (b)(2) to use the |
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single local use tax rate and the person pays to the remote seller |
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the amount of local use tax computed on the purchase using the |
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single local use tax rate. |
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(h) The comptroller shall administer, collect, and enforce |
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local use taxes computed using the single local use tax rate. |
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(i) The comptroller shall apportion and distribute revenue |
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from local use taxes computed using the single local use tax rate as |
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provided by Section 403.107, Government Code. |
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(j) The comptroller may adopt rules to administer this |
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section. |
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SECTION 3. Section 403.107, Government Code, is reenacted |
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and amended to read as follows: |
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Sec. 403.107. SINGLE LOCAL USE TAXES COLLECTED BY REMOTE |
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SELLERS [SALES AND USE TAX FEES]. (a) The comptroller shall |
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deposit revenue remitted to the comptroller from taxes computed |
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using the single local use tax rate under Section 151.0595(b)(2) |
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[fees imposed under Section 151.059], Tax Code, in the state |
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treasury and shall keep records of the amount of money deposited |
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[collected] for each reporting period. Money deposited under this |
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subsection [Such fees] shall be held in trust for the benefit of |
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eligible taxing units, as determined under Subsection (b) [in the
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suspense account of each eligible taxing unit]. The comptroller |
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shall distribute money held in trust [in the suspense accounts] |
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under this section to each eligible taxing unit in the amount and |
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manner provided by [federal law or] this section. |
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(b) A local taxing unit is an eligible taxing unit for |
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purposes of [to receive funds under] this section if it has adopted |
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a sales and use tax authorized or governed by Title 3, Tax Code |
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[under Chapter 321, Chapter 322, or Chapter 323, Tax Code, or has
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adopted a local sales and use tax governed in part by any provision
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of those chapters]. |
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(c) Subject to Subsection (d), the [The] comptroller shall |
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transmit to each eligible taxing unit's treasurer, or to the |
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officer performing the functions of that office, on a monthly |
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[quarterly] basis, the taxing unit's share of money held in trust |
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under Subsection (a) [the fees remitted to the comptroller], |
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together with the pro rata share of any penalty or interest on |
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delinquent taxes computed using the single local use tax rate |
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[fees] that may be collected. Before transmitting the funds, the |
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comptroller shall deduct two percent of [the amount allocated to] |
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each taxing unit's share [unit] as a charge by the state for its |
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services under this section and deposit that amount into the state |
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treasury to the credit of the comptroller's operating fund. |
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Interest earned on all deposits made in the state treasury under |
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this section shall be credited to the general revenue fund. |
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(d) The comptroller shall retain [in the suspense account
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for a taxing unit] a portion of each eligible [the] taxing unit's |
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share of money held in trust under Subsection (a) [the fees
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collected], not to exceed five percent of the amount eligible to be |
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transmitted [remitted] to the taxing unit under Subsection (c). |
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From the amounts retained [in a taxing unit's suspense account], |
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the comptroller may make refunds for overpayments of taxes computed |
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using the single local use tax rate, make refunds to purchasers as |
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provided by Section 151.0595(f), Tax Code, and [to the account and
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to] redeem dishonored checks and drafts deposited under Subsection |
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(a) [to the credit of the account]. |
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(e) The [Unless another method is required by federal law,
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the] comptroller shall compute for each calendar month [quarter] |
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the percentage of the total sales and use tax allocations made |
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pursuant to Title 3, [of the] Tax Code, including any local sales |
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and use taxes governed by any provision of Title 3, [of the] Tax |
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Code, to each eligible taxing unit. The comptroller shall |
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determine each eligible taxing unit's share of the money held in |
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trust from deposits under Subsection (a) for that month by applying |
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the percentage computed under this subsection for the eligible |
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taxing unit [and shall apply that percentage] to the total amount |
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held in trust from deposits for that month [fees collected under
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Section 151.059, Tax Code, and allocated to eligible taxing units
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in that quarter]. |
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(f) The comptroller may combine an eligible taxing unit's |
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share of the money held in trust under Subsection (a) [fees remitted
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or collected under Section 151.059, Tax Code, a suspense account
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under this section, or an allocation made under this section] with |
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other money [trust or suspense accounts] held for that taxing unit |
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[or other allocations made to that taxing unit under Title 3 of the
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Tax Code]. |
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(g) The comptroller may adopt rules to administer this |
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section. |
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SECTION 4. Sections 151.059 and 151.107(c), Tax Code, as |
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added by Chapter 291 (H.B. 2215), Acts of the 71st Legislature, |
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Regular Session, 1989, are repealed. |
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SECTION 5. The changes in law made by this Act do not affect |
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tax liability accruing before the effective date of this Act. That |
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liability continues in effect as if this Act had not been enacted, |
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and the former law is continued in effect for the collection of |
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taxes due and for civil and criminal enforcement of the liability |
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for those taxes. |
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SECTION 6. (a) This Act does not require a remote seller, |
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as defined by Section 151.0595, Tax Code, as added by this Act, to |
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collect local use taxes on sales of taxable items made before |
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October 1, 2019. |
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(b) Notwithstanding Section 151.0595(d), Tax Code, as added |
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by this Act, the single local use tax rate in effect for the period |
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beginning October 1, 2019, and ending December 31, 2019, is 1.75 |
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percent. |
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SECTION 7. This Act takes effect October 1, 2019. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 2153 was passed by the House on April |
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11, 2019, by the following vote: Yeas 145, Nays 0, 2 present, not |
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voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 2153 was passed by the Senate on May |
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3, 2019, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: _____________________ |
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Date |
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_____________________ |
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Governor |