H.B. No. 1770
AN ACT
relating to the Tax Increment Financing Act.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 311.003(a), Tax Code, is amended to read
as follows:
(a) The governing body of a county by order may designate a
contiguous geographic area in the county and the governing body of a
municipality by ordinance [or the governing body of a county by
order] may designate a contiguous or noncontiguous geographic area
that is in the corporate limits of the municipality, in the
extraterritorial jurisdiction of the municipality, or in both [in
the jurisdiction of the municipality or county] to be a
reinvestment zone to promote development or redevelopment of the
area if the governing body determines that development or
redevelopment would not occur solely through private investment in
the reasonably foreseeable future. The designation of an area that
is wholly or partly located in the extraterritorial jurisdiction of
a municipality is not affected by a subsequent annexation of real
property in the reinvestment zone by the municipality.
SECTION 2. Section 311.006(a), Tax Code, is amended to read
as follows:
(a) A municipality may not create a reinvestment zone if:
(1) more than 10 percent of the property in the
proposed zone, excluding property that is publicly owned, is used
for residential purposes; or
(2) the total appraised value of taxable real property
in the proposed zone and in existing reinvestment zones exceeds:
(A) 20 percent of the total appraised value of
taxable real property in the municipality and in the industrial
districts created by the municipality, if the municipality is the
county seat of a county:
(i) that is adjacent to a county with a
population of 3.3 million or more; and
(ii) in which a planned community is
located that has 20,000 or more acres of land, that was originally
established under the Urban Growth and New Community Development
Act of 1970 (42 U.S.C. Section 4501 et seq.), and that is subject to
restrictive covenants containing ad valorem or annual variable
budget-based assessments on real property; or
(B) 15 percent of the total appraised value of
taxable real property in the municipality and in the industrial
districts created by the municipality, if Paragraph (A) does not
apply to the municipality.
SECTION 3. Section 311.012(a), Tax Code, is amended to read
as follows:
(a) The amount of a taxing unit's tax increment for a year is
the amount of property taxes levied and assessed by the unit for
that year on the captured appraised value of real property taxable
by the unit and located in a reinvestment zone or the amount of
property taxes levied and collected by the unit for that year on the
captured appraised value of real property taxable by the unit and
located in a reinvestment zone. The governing body of a taxing unit
shall determine which of the methods specified by this subsection
is used to calculate the amount of the unit's tax increment.
SECTION 4. Sections 311.013(c) and (i), Tax Code, are
amended to read as follows:
(c) Notwithstanding any termination of the reinvestment
zone under Section 311.017(a), a [A] taxing unit shall make a
payment required by Subsection (b) not later than the 90th day after
the delinquency date for the unit's property taxes. A delinquent
payment incurs a penalty of five percent of the amount delinquent
and accrues interest at an annual rate of 10 percent.
(i) Notwithstanding Subsection (c) and Section 311.012(a),
a taxing unit is not required to pay into a tax increment fund the
applicable portion of a tax increment attributable to delinquent
taxes until those taxes are collected.
SECTION 5. Section 311.017, Tax Code, is amended by amending
Subsection (a) and adding Subsection (a-1) to read as follows:
(a) A reinvestment zone terminates on the earlier of:
(1) the termination date designated in the ordinance
or order, as applicable, creating the zone or an earlier or later
termination date designated by an ordinance or order adopted
subsequent to the ordinance or order creating the zone; or
(2) the date on which all project costs, tax increment
bonds and interest on those bonds, and other obligations have been
paid in full.
(a-1) Notwithstanding the designation of a later
termination date under Subsection (a), a taxing unit that taxes
real property located in the reinvestment zone, other than the
municipality or county that created the zone, is not required to pay
any of its tax increment into the tax increment fund for the zone
after the termination date designated in the ordinance or order
creating the zone unless the governing body of the taxing unit
enters into an agreement to do so with the governing body of the
municipality or county that created the zone.
SECTION 6. Section 311.006(a), Tax Code, as amended by this
Act, applies only to a reinvestment zone created on or after the
effective date of this Act. The creation of a reinvestment zone
before the effective date of this Act is covered by the law in
effect immediately before the effective date of this Act, and the
former law is continued in effect for that purpose.
SECTION 7. (a) The legislature validates and confirms all
governmental acts and proceedings of a municipality or county that
were taken before the effective date of this Act and relate to or
are associated with the extension of the term of a reinvestment zone
created by the municipality or county under Chapter 311, Tax Code,
as of the dates on which they occurred. The acts and proceedings
may not be held invalid because they were not in accordance with
Chapter 311, Tax Code, or other law.
(b) Subsection (a) of this section does not apply to any
matter that on the effective date of this Act:
(1) is involved in litigation if the litigation
ultimately results in the matter being held invalid by a final
judgment of a court; or
(2) has been held invalid by a final judgment of a
court.
SECTION 8. This Act applies only to a taxing unit's tax
increment for a period occurring on or after the effective date of
this Act. A taxing unit's tax increment for a period occurring
before the effective date of this Act is governed by the law in
effect for such period, and the former law is continued in effect
for that purpose.
SECTION 9. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2009.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1770 was passed by the House on April
28, 2009, by the following vote: Yeas 148, Nays 1, 1 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 1770 on May 29, 2009, by the following vote: Yeas 123, Nays 16,
1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 1770 was passed by the Senate, with
amendments, on May 25, 2009, by the following vote: Yeas 30, Nays
1.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor