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AN ACT
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relating to the sale of electric power to certain public customers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 52.133(d), Natural Resources Code, is |
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amended to read as follows: |
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(d) The commissioner, the owner of the soil under Subchapter |
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F, or the commissioner acting on behalf of and at the direction of |
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an owner of the soil under Subchapter F, the board, or a board for |
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lease may negotiate and execute contracts or any other instruments |
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or agreements necessary to convert that portion of the royalty |
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taken in kind into other forms of energy, other than [including] |
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electricity. |
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SECTION 2. Section 53.026(b), Natural Resources Code, is |
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amended to read as follows: |
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(b) The commissioner or the commissioner acting on behalf of |
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and at the direction of the board or a board for lease may negotiate |
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and execute a contract or any other instrument or agreement |
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necessary to convert that portion of the royalty taken in kind to |
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other forms of energy, other than [including] electricity. |
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SECTION 3. Section 53.077(b), Natural Resources Code, is |
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amended to read as follows: |
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(b) The commissioner, each owner of the soil under this |
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subchapter, or the commissioner acting on behalf of and at the |
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direction of the owner of the soil under this subchapter may |
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negotiate and execute a contract or any other instrument or |
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agreement necessary to convert that portion of the royalty taken in |
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kind to other forms of energy, other than [including] electricity. |
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SECTION 4. Section 182.022, Tax Code, is amended by adding |
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Subsection (d) to read as follows: |
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(d) Notwithstanding any other provisions of this chapter, a |
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tax under this chapter may not be imposed on the gross receipts from |
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the sale of electricity to a public school district customer. |
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SECTION 5. Section 35.102, Utilities Code, is transferred |
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to Subchapter A, Chapter 101, Utilities Code, redesignated as |
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Section 101.009, Utilities Code, and amended to read as follows: |
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Sec. 101.009 [35.102]. STATE AUTHORITY TO SELL OR CONVEY |
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[POWER OR] NATURAL GAS. (a) In this section: |
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(1) "Commissioner" means the commissioner of the |
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General Land Office. |
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(2) "Public retail customer" means a retail customer |
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that is an agency of this state, a state institution of higher |
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education, a public school district, a political subdivision of |
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this state, a military installation of the United States, or a |
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United States Department of Veterans Affairs facility. |
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(b) The commissioner, acting on behalf of the state, may |
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sell or otherwise convey [power or] natural gas generated from |
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royalties taken in kind as provided by Sections 52.133(f), 53.026, |
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and 53.077, Natural Resources Code, directly to a public retail |
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customer [regardless of whether the public retail customer is also
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classified as a wholesale customer under other provisions of this
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title]. |
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(c) [(b)] To ensure that the state receives the maximum |
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benefit from the sale of [power or] natural gas generated from |
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royalties taken in kind, the commissioner shall use all feasible |
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means to sell that [power or] natural gas first to public retail |
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customers that are military installations of the United States, |
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agencies of this state, institutions of higher education, or public |
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school districts. The remainder of the [power or] natural gas, if |
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any, may be sold to public retail customers that are political |
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subdivisions of this state or to a United States Department of |
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Veterans Affairs facility. |
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SECTION 6. Section 104.2545(d), Utilities Code, is amended |
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to read as follows: |
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(d) In this section, "public retail customer" has the |
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meaning assigned by Section 101.009 [35.101]. |
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SECTION 7. (a) The heading to Subchapter D, Chapter 35, |
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Utilities Code, is repealed. |
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(b) Sections 35.101, 35.103, 35.104, 35.105, and 35.106, |
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Utilities Code, are repealed. |
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SECTION 8. The General Land Office or an entity operating |
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under a contract with the General Land Office may continue to |
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provide retail electric service in accordance with Subchapter D, |
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Chapter 35, Utilities Code, as that subchapter existed before the |
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effective date of this Act, under the terms of an agreement with a |
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customer entered into before the effective date of this Act, only |
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until the date the agreement expires. An agreement described by |
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this section may be extended to a date not later than January 1, |
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2024. |
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SECTION 9. The change in law made by this Act does not |
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affect taxes imposed before the effective date of this Act, and the |
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law in effect before the effective date of this Act is continued in |
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effect for purposes of the liability for and collection of those |
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taxes. |
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SECTION 10. (a) As soon as practicable after January 1, |
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2024, the Public Utility Commission of Texas, for an electric |
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utility regulated under Chapter 36, Utilities Code, shall provide |
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for the adjustment of the electric utility's billing of a public |
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school district customer to reflect any decrease in the utility's |
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tax liability to this state if the decrease is attributable to the |
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exemption in Section 182.022(d), Tax Code, as added by this Act. An |
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adjustment must be made effective at the same time as the decrease |
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of tax liability or as soon after that decrease occurs as is |
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reasonably practicable. The Public Utility Commission of Texas is |
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not required to provide for an adjustment if the commission enters |
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an order for the utility under Subchapter C or D, Chapter 36, |
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Utilities Code, that accounts for any decrease in the utility's tax |
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liability attributable to the exemption in Section 182.022(d), Tax |
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Code, as added by this Act. An adjustment is not a rate case under |
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Subchapter C or D, Chapter 36, Utilities Code. |
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(b) As soon as practicable after January 1, 2024, a retail |
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electric provider, as defined by Section 31.002, Utilities Code, |
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shall adjust the billing of a public school district customer to |
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reflect any decrease in the retail electric provider's tax |
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liability to this state if the decrease is attributable to the |
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exemption in Section 182.022(d), Tax Code, as added by this Act. An |
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adjustment must be made effective at the same time as the decrease |
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of tax liability or as soon after that decrease occurs as is |
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reasonably practicable. |
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SECTION 11. (a) Except as provided by Subsection (b) of |
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this section, this Act takes effect immediately if it receives a |
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vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2019. |
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(b) Section 182.022(d), Tax Code, as added by this Act, |
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takes effect January 1, 2024. |
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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. 2263 was passed by the House on April |
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10, 2019, by the following vote: Yeas 146, Nays 0, 1 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. 2263 was passed by the Senate on |
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May 2, 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 |