By: Seliger S.B. No. 1593
(In the Senate - Filed March 10, 2009; March 17, 2009, read
first time and referred to Committee on Economic Development;
April 23, 2009, reported favorably, as amended, by the following
vote: Yeas 3, Nays 0; April 23, 2009, sent to printer.)
COMMITTEE AMENDMENT NO. 1 By: Watson
Amend S.B. No. 1593 as follows:
(1) In SECTION 2 of the bill, in amended Subdivision (3),
Section 313.021, Tax Code (page 5, lines 1 through 3), strike
amended Paragraph (E) and substitute the following:
(E) pays:
(i) at least the lesser of $50,000 or 110
percent of the county average weekly wage for manufacturing jobs in
the county where the job is located, if the county has a population
of less than 800,000; or
(ii) at least 110 percent of the county
average weekly wage for all industries in the county where the job
is located, if the county has a population of 800,000 or more.
(2) Strike the recital to SECTION 4 of the bill (page 5,
lines 50 and 51) and substitute the following:
SECTION 4. Section 313.025, Tax Code, is amended by
amending Subsection (a) and adding Subsections (a-1) and (d-1) to
read as follows:
(3) In SECTION 4 of the bill, following Subsection (a),
Section 313.025, Tax Code (page 5, between lines 68 and 69),
insert the following, and renumber subsequent SECTIONS as
appropriate:
(a-1) If the school district maintains a generally
accessible Internet website, the district shall post on that site
each application received under Subsection (a) and any information
in the possession of the district that relates to an application.
This subsection does not require a school district to post
information that is confidential business information under
Section 313.028.
(d-1) The governing body of a school district may approve an
application that the comptroller has recommended should be
disapproved only if:
(1) the governing body holds a public hearing the sole
purpose of which is to consider the application and the
comptroller's recommendation; and
(2) at a subsequent meeting of the governing body held
after the date of the public hearing, at least two-thirds of the
members of the governing body vote to approve the application.
SECTION 5. Subsections (a) and (b), Section 313.026, Tax
Code, are amended to read as follows:
(a) The economic impact evaluation of the application must
include the following:
(1) the recommendations of the comptroller;
(2) the name of the school district;
(3) the name of the applicant;
(4) the general nature of the applicant's investment;
(5) [(2)] the relationship between the applicant's
industry and the types of qualifying jobs to be created by the
applicant to the long-term economic growth plans of this state as
described in the strategic plan for economic development submitted
by the Texas Strategic Economic Development Planning Commission
under Section 481.033, Government Code, as that section existed
before February 1, 1999;
(6) [(3)] the relative level of the applicant's
investment per qualifying job to be created by the applicant;
(7) the number of qualifying jobs to be created by the
applicant;
(8) [(4)] the wages, salaries, and benefits to be
offered by the applicant to qualifying job holders;
(9) [(5)] the ability of the applicant to locate or
relocate in another state or another region of this state;
(10) [(6)] the impact the project [added
infrastructure] will have on this state and individual local units
of government [the region], including:
(A) tax and other revenue gains, direct or
indirect, that would be realized during the qualifying period, the
limitation period, and a period of time after the limitation period
considered appropriate by the comptroller [by the school district];
and
(B) [subsequent] economic effects of the
project, including the impact on jobs and income, during the
qualifying period, the limitation period, and a period of time
after the limitation period considered appropriate by the
Comptroller [on the local and regional tax bases];
(11) [(7)] the economic condition of the region of the
state at the time the person's application is being considered;
(12) [(8)] the number of new facilities built or
expanded in the region during the two years preceding the date of
the application that were eligible to apply for a limitation on
appraised value under this subchapter; [and]
(13) [(9)] the effect of the applicant's proposal, if
approved, on the number or size of the school district's
instructional facilities, as defined by Section 46.001, Education
Code;
(14) the projected market value of the qualified
property of the applicant during the qualifying period, the
limitation period, and a period of time after the limitation period
considered appropriate by the comptroller;
(15) the proposed limitation on appraised value for
the qualified property of the applicant.
(b) The comptroller's recommendations shall be based on the
criteria listed in Subsections (a)(2)-(15) [(a)(2)-(9)] and on any
other information available to the comptroller, including
information provided by the governing body of the school district
under Section 313.025(b).
SECTION 6. Subchapter B, Chapter 313, Tax Code, is amended
by adding Section 313.0265 to read as follows:
Sec. 313.0265. DISCLOSURE OF APPRAISED VALUE LIMITATION
INFORMATION. (a) If a school district maintains a generally
accessible Internet website, the district shall post each document
or item of information concerning appraised value limitations under
this subchapter and school tax credits under Subchapter D that the
comptroller designates as substantive.
(b) Each document or item of information posted under
Subsection (a) must continue to be posted until the appraised value
limitation expires or the school district no longer maintains the
website.
(c) The comptroller shall post on the comptroller's
Internet website each document or item of information the
comptroller designates as substantive. Each document or item of
information must continue to be posted until the appraised value
limitation expires.
(d) The comptroller shall designate the following as
substantive:
(1) each application requesting a limitation on
appraised value;
(2) the economic impact evaluation made in connection
with the application;
(3) each application requesting school tax credits
under Section 313.103; and
(4) any additional information that the comptroller
deems substantive that is not otherwise confidential by law.
(e) The comptroller by rule shall determine the
requirements for districts to post on their Internet websites the
documents provided under Subsection (a) and shall provide a link on
the comptroller's website to all school districts' appraised value
limitation postings.
(f) The comptroller and the Texas Education Agency shall
annually certify that districts comply with the posting
requirements of Subsection (b).
(4) Immediately following existing SECTION 5 of the bill
(page 6, between lines 11 and 12), insert the following and renumber
subsequent SECTIONs appropriately:
SECTION ____. Section 313.028, Tax Code, is amended to read
as follows:
Sec. 313.028. CERTAIN BUSINESS INFORMATION CONFIDENTIAL.
Information provided to a school district in connection with an
application for a limitation on appraised value under this
subchapter that describes the specific processes or business
activities to be conducted or the specific tangible personal
property to be located on real property covered by the application
shall be segregated in the application from other information in
the application and is confidential and not subject to public
disclosure unless the governing body of the school district
approves the application. Other information in the custody of a
school district or the comptroller in connection with the
application, including information related to the economic impact
of a project or the essential elements of eligibility under this
chapter, such as the nature and amount of the projected investment,
employment, wages, and benefits, may not be considered confidential
business information if the governing body of the school district
agrees to consider the application unless it is considered to be
confidential under other law. Information in the custody of a
school district or the comptroller if the governing body approves
the application is not confidential under this section.
A BILL TO BE ENTITLED
AN ACT
relating to agreements for limitations on appraised value under the
Texas Economic Development Act.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 313.007, Tax Code, is amended to read as
follows:
Sec. 313.007. EXPIRATION. Subchapters B, C, and D expire
December 31, 2015 [2011].
SECTION 2. Section 313.021, Tax Code, is amended to read as
follows:
Sec. 313.021. DEFINITIONS. In this subchapter:
(1) "Qualified investment" means:
(A) tangible personal property that is first
placed in service in this state during the applicable qualifying
time period that begins on or after January 1, 2002 without regard
to whether the property is affixed to or incorporated into real
property, and is described as Section 1245 property by Section
1245(a), Internal Revenue Code of 1986;
(B) tangible personal property that is first
placed in service in this state during the applicable qualifying
time period that begins on or after January 1, 2002, without regard
to whether the property is affixed to or incorporated into real
property, and that is used in connection with the manufacturing,
processing, or fabrication in a cleanroom environment of a
semiconductor product, without regard to whether the property is
actually located in the cleanroom environment, including:
(i) integrated systems, fixtures, and
piping;
(ii) all property necessary or adapted to
reduce contamination or to control airflow, temperature, humidity,
chemical purity, or other environmental conditions or
manufacturing tolerances; and
(iii) production equipment and machinery,
moveable cleanroom partitions, and cleanroom lighting;
(C) tangible personal property that is first
placed in service in this state during the applicable qualifying
time period that begins on or after January 1, 2002, without regard
to whether the property is affixed to or incorporated into real
property, and that is used in connection with the operation of a
nuclear electric power generation facility, including:
(i) property, including pressure vessels,
pumps, turbines, generators, and condensers, used to produce
nuclear electric power; and
(ii) property and systems necessary to
control radioactive contamination;
(D) tangible personal property that is first
placed in service in this state during the applicable qualifying
time period that begins on or after January 1, 2002, without regard
to whether the property is affixed to or incorporated into real
property, and that is used in connection with operating an
integrated gasification combined cycle electric generation
facility, including:
(i) property used to produce electric power
by means of a combined combustion turbine and steam turbine
application using synthetic gas or another product produced by the
gasification of coal or another carbon-based feedstock; or
(ii) property used in handling materials to
be used as feedstock for gasification or used in the gasification
process to produce synthetic gas or another carbon-based feedstock
for use in the production of electric power in the manner described
by Subparagraph (i); or
(E) a building or a permanent, nonremovable
component of a building that is built or constructed during the
applicable qualifying time period that begins on or after January
1, 2002, and that houses tangible personal property described by
Paragraph (A), (B), (C), or (D).
(2) "Qualified property" means:
(A) land:
(i) that is located in an area designated as
a reinvestment zone under Chapter 311 or 312 or as an enterprise
zone under Chapter 2303, Government Code;
(ii) on which a person proposes to
construct a new building or erect or affix a new improvement that
does not exist before the date such person [the owner] applies for a
limitation on appraised value under this subchapter;
(iii) that is not subject to a tax abatement
agreement entered into by a school district under Chapter 312; and
(iv) on which, in connection with the new
building or new improvement described by Subparagraph (ii), the
owner or lessee of, or holder of another possessory interest in, the
land proposes to:
(a) make a qualified investment in an
amount equal to at least the minimum amount required by Section
313.023; and
(b) create at least 25 new jobs;
(B) the new building or other new improvement
described by Paragraph (A)(ii); and
(C) tangible personal property that:
(i) is not subject to a tax abatement
agreement entered into by a school district under Chapter 312; and
(ii) except for new equipment described in
Section 151.318(q) or (q-1), is first placed in service in the new
building or in or on the new improvement described by Paragraph
(A)(ii), or on the land on which that new building or new
improvement is located, if the personal property is ancillary and
necessary to the business conducted in that new building or in or on
that new improvement.
(3) "Qualifying job" means a permanent full-time job
that:
(A) requires at least 1,600 hours of work a year;
(B) is not transferred from one area in this
state to another area in this state;
(C) is not created to replace a previous
employee;
(D) is covered by a group health benefit plan, as
defined by Section 481.151, Government Code, for which the business
offers to pay at least 80 percent of the premiums or other charges
assessed for employee-only coverage under the plan, regardless of
whether an employee may voluntarily waive the coverage; and
(E) pays at least 110 percent of the county
average weekly wage [for manufacturing jobs] in the county where
the job is located.
(4) "Qualifying time period" means:
(A) the period from the date that a person's
application for a limitation on appraised value is approved by the
governing body of the school district through the end of the first
two tax years that begin on or after the date a person's application
for a limitation on appraised value under this subchapter is
approved, except as provided by Paragraph (B) or by Section
313.027(h); or
(B) in connection with a nuclear electric power
generation facility, the first seven tax years that begin on or
after the third anniversary of the date the school district
approves the property owner's application for a limitation on
appraised value under this subchapter, unless a shorter time period
is agreed to by the governing body of the school district and the
property owner.
(5) "County average weekly wage [for manufacturing
jobs]" means the average weekly wage in a county [for manufacturing
jobs] as computed by the Texas Workforce Commission with respect to
the most recent four quarters then available from the Texas
Workforce Commission.
SECTION 3. Subsection (e), Section 313.024, Tax Code, is
amended to read as follows:
(e) In this section:
(1) "Manufacturing" means an establishment that is
primarily engaged in activities that are described in sector codes
31-33 of the North American Industry Classification System [and
"research and development" have the meanings assigned by Section
171.751].
(2) "Research and development" means an establishment
that is primarily engaged in activities that are described in
industry code 541710 of the 2002 North American Industry
Classification System.
(3) "Renewable energy electric generation" means an
establishment primarily engaged in activities described in
category 221119 of the 1997 North American Industry Classification
System.
(4) [(3)] "Integrated gasification combined cycle
technology" means technology used to produce electricity in a
combined combustion turbine and steam turbine application using
synthetic gas or another product produced from the gasification of
coal or another carbon-based feedstock, including related
activities such as materials-handling and gasification of coal or
another carbon-based feedstock.
(5) [(4)] "Nuclear electric power generation" means
activities described in category 221113 of the 2002 North American
Industry Classification System.
SECTION 4. Subsection (a), Section 313.025, Tax Code, is
amended to read as follows:
(a) The owner or lessee of, or other holder of a possessory
interest in, any qualified property described in Section
313.021(2)(A), (B), or (C) may apply to the governing body of the
school district in which the property is located for a limitation on
the appraised value for school district maintenance and operations
ad valorem tax purposes of the person's qualified property. An
application must be made on the form prescribed by the comptroller
and include the information required by the comptroller, and it
must be accompanied by:
(1) the application fee established by the governing
body of the school district;
(2) information sufficient to show that the real and
personal property identified in the application as qualified
property meets the applicable criteria established by Section
313.021(2); and
(3) information relating to each applicable criterion
listed in Section 313.026.
SECTION 5. Section 313.027, Tax Code, is amended by adding
Subsection (h) to read as follows:
(h) The governing body of the school district and the
property owner may agree to delay the effective date of the
agreement or subsequently amend the agreement to delay the
effective date of the agreement for a period not to exceed five
years from the date that the governing body of the school district
first approves the agreement. In the event that the governing body
of the school district and the property owner agree to delay the
effective date of the agreement, the qualifying time period shall
consist of the first two tax years that begin on or after the
effective date of the agreement.
SECTION 6. Section 313.051, Tax Code, is amended to read as
follows:
Sec. 313.051. APPLICABILITY. (a) This subchapter applies
only to a school district that has territory in:
(1) an area that qualified as a strategic investment
area under Subchapter O, Chapter 171, immediately before that
subchapter expired[, as defined by Section 171.721]; or
(2) a county:
(A) that has a population of less than 50,000;
and
(B) [that is not partially or wholly located in a
metropolitan statistical area; and
[(C)] in which, from 1990 to 2000, according to
the federal decennial census, the population:
(i) remained the same;
(ii) decreased; or
(iii) increased, but at a rate of not more
than three percent per annum.
(a-1) Notwithstanding Subsection (a), if on January 1,
2002, this subchapter applied to a school district in whose
territory is located a federal nuclear facility, this subchapter
continues to apply to the school district regardless of whether the
school district ceased or ceases to be described by Subsection (a)
after that date.
(b) The governing body of a school district to which this
subchapter applies may enter into an agreement in the same manner as
a school district to which Subchapter B applies may do so under
Subchapter B, subject to Sections 313.052-313.054. Except as
otherwise provided by this subchapter, the provisions of Subchapter
B apply to a school district to which this subchapter applies. For
purposes of this subchapter, a property owner is required to create
only at least 10 new jobs on the owner's qualified property. At
least 80 percent of all the new jobs created must be qualifying jobs
as defined by Section 313.021(3)[, except that, for a school
district described by Subsection (a)(2), each qualifying job must
pay at least 110 percent of the average weekly wage for
manufacturing jobs in the region designated for the regional
planning commission, council of governments, or similar regional
planning agency created under Chapter 391, Local Government Code,
in which the district is located].
SECTION 7. Subsection (d), Section 403.302, Government
Code, is amended to read as follows:
(d) For the purposes of this section, "taxable value" means
the market value of all taxable property less:
(1) the total dollar amount of any residence homestead
exemptions lawfully granted under Section 11.13(b) or (c), Tax
Code, in the year that is the subject of the study for each school
district;
(2) one-half of the total dollar amount of any
residence homestead exemptions granted under Section 11.13(n), Tax
Code, in the year that is the subject of the study for each school
district;
(3) the total dollar amount of any exemptions granted
before May 31, 1993, within a reinvestment zone under agreements
authorized by Chapter 312, Tax Code;
(4) subject to Subsection (e), the total dollar amount
of any captured appraised value of property that:
(A) is within a reinvestment zone created on or
before May 31, 1999, or is proposed to be included within the
boundaries of a reinvestment zone as the boundaries of the zone and
the proposed portion of tax increment paid into the tax increment
fund by a school district are described in a written notification
provided by the municipality or the board of directors of the zone
to the governing bodies of the other taxing units in the manner
provided by Section 311.003(e), Tax Code, before May 31, 1999, and
within the boundaries of the zone as those boundaries existed on
September 1, 1999, including subsequent improvements to the
property regardless of when made;
(B) generates taxes paid into a tax increment
fund created under Chapter 311, Tax Code, under a reinvestment zone
financing plan approved under Section 311.011(d), Tax Code, on or
before September 1, 1999; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(5) for a school district for which a deduction from
taxable value is made under Subdivision (4), an amount equal to the
taxable value required to generate revenue when taxed at the school
district's current tax rate in an amount that, when added to the
taxes of the district paid into a tax increment fund as described by
Subdivision (4)(B), is equal to the total amount of taxes the
district would have paid into the tax increment fund if the district
levied taxes at the rate the district levied in 2005;
(6) the total dollar amount of any captured appraised
value of property that:
(A) is within a reinvestment zone:
(i) created on or before December 31, 2008,
by a municipality with a population of less than 18,000; and
(ii) the project plan for which includes
the alteration, remodeling, repair, or reconstruction of a
structure that is included on the National Register of Historic
Places and requires that a portion of the tax increment of the zone
be used for the improvement or construction of related facilities
or for affordable housing;
(B) generates school district taxes that are paid
into a tax increment fund created under Chapter 311, Tax Code; and
(C) is eligible for tax increment financing under
Chapter 311, Tax Code;
(7) the total dollar amount of any exemptions granted
under Section 11.251 or 11.253, Tax Code;
(8) the difference between the comptroller's estimate
of the market value and the productivity value of land that
qualifies for appraisal on the basis of its productive capacity,
except that the productivity value estimated by the comptroller may
not exceed the fair market value of the land;
(9) the portion of the appraised value of residence
homesteads of individuals who receive a tax limitation under
Section 11.26, Tax Code, on which school district taxes are not
imposed in the year that is the subject of the study, calculated as
if the residence homesteads were appraised at the full value
required by law;
(10) a portion of the market value of property not
otherwise fully taxable by the district at market value because of:
(A) action required by statute or the
constitution of this state that, if the tax rate adopted by the
district is applied to it, produces an amount equal to the
difference between the tax that the district would have imposed on
the property if the property were fully taxable at market value and
the tax that the district is actually authorized to impose on the
property, if this subsection does not otherwise require that
portion to be deducted; or
(B) action taken by the district under Subchapter
B or C, Chapter 313, Tax Code, before the expiration of the
subchapter;
(11) the market value of all tangible personal
property, other than manufactured homes, owned by a family or
individual and not held or used for the production of income;
(12) the appraised value of property the collection of
delinquent taxes on which is deferred under Section 33.06, Tax
Code;
(13) the portion of the appraised value of property
the collection of delinquent taxes on which is deferred under
Section 33.065, Tax Code; and
(14) the amount by which the market value of a
residence homestead to which Section 23.23, Tax Code, applies
exceeds the appraised value of that property as calculated under
that section.
SECTION 8. Paragraph (A), Subdivision (1), and Subdivision
(2), Section 313.021, Tax Code, as amended by Section 2 of this Act,
Subsection (e), Section 313.024, Tax Code, as amended by Section 3
of this Act, and Subsection (a), Section 313.025, Tax Code, as
amended by Section 4 of this Act, are intended to clarify existing
law in effect before the effective date of this Act and are not
intended to make a substantive change in the law.
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.
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