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Texas Senate Bill SB1929

Texas 2009 - 81st Regular

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11 81R10452 CLG-D
22 By: Watson S.B. No. 1929
33
44
55 A BILL TO BE ENTITLED
66 AN ACT
77 relating to the designation of media production development zones
88 and to exemptions from the sales and use tax for items used for
99 sound stages in media production development zones.
1010 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1111 SECTION 1. Subtitle F, Title 4, Government Code, is amended
1212 by adding Chapter 485A to read as follows:
1313 CHAPTER 485A. MEDIA PRODUCTION DEVELOPMENT ZONES
1414 SUBCHAPTER A. GENERAL PROVISIONS
1515 Sec. 485A.001. SHORT TITLE. This chapter may be cited as
1616 the Media Production Development Zone Act.
1717 Sec. 485A.002. DEFINITIONS. In this chapter:
1818 (1) "Media production development zone" means an area
1919 designated as a media production development zone under this
2020 chapter.
2121 (2) "Moving image project" means a visual and sound
2222 production, including a film, television program, national or
2323 multistate commercial, or digital interactive media production.
2424 The term does not include a production that is obscene, as defined
2525 by Section 43.21, Penal Code.
2626 (3) "Nominating body" means the governing body of a
2727 municipality or county, or a combination of the governing bodies of
2828 municipalities or counties, that nominates and applies for
2929 designation of an area as a media production development zone.
3030 (4) "Office" means the Music, Film, Television, and
3131 Multimedia Office within the office of the governor.
3232 (5) "Qualified person" means a person certified as a
3333 qualified person under Section 485A.201.
3434 (6) "Sound stage" means a structure, building, or room
3535 used for the specific purpose of creating a moving image project.
3636 Sec. 485A.003. JURISDICTION OF MUNICIPALITY. For the
3737 purposes of this chapter, territory in the extraterritorial
3838 jurisdiction of a municipality is considered to be in the
3939 jurisdiction of the municipality.
4040 [Sections 485A.004-485A.050 reserved for expansion]
4141 SUBCHAPTER B. OFFICE POWERS AND DUTIES IN GENERAL
4242 Sec. 485A.051. GENERAL POWERS AND DUTIES. (a) The office
4343 shall administer and monitor the implementation of this chapter.
4444 (b) The office shall establish criteria and procedures for
4545 designating a qualified area as a media production development zone
4646 and for certifying a person as a qualified person under Section
4747 485A.201.
4848 Sec. 485A.052. RULEMAKING AUTHORITY. The office shall
4949 adopt rules necessary to implement this chapter.
5050 Sec. 485A.053. ANNUAL REPORT. On or before December 15 of
5151 each year, the office shall submit to the governor, the
5252 legislature, and the Legislative Budget Board a report that:
5353 (1) evaluates the effectiveness of the media
5454 production development zone program; and
5555 (2) describes the use of state and local incentives
5656 under this chapter and their effect on revenue.
5757 Sec. 485A.054. ASSISTANCE. The office shall provide to
5858 persons desiring to construct, expand, maintain, improve, or
5959 renovate a sound stage in a media production development zone
6060 information and appropriate assistance relating to the required
6161 legal authorization, including a permit, certificate, approval,
6262 and registration, necessary in this state to accomplish that
6363 objective.
6464 [Sections 485A.055-485A.100 reserved for expansion]
6565 SUBCHAPTER C. DESIGNATION OF MEDIA PRODUCTION DEVELOPMENT ZONE
6666 Sec. 485A.101. CRITERIA FOR MEDIA PRODUCTION DEVELOPMENT
6767 ZONE DESIGNATION. To be designated a media production development
6868 zone, an area must be land or other real property that:
6969 (1) will:
7070 (A) be used exclusively to build or construct one
7171 or more sound stages;
7272 (B) if the real property is a building or other
7373 facility, be renovated solely for the purpose of being converted
7474 into one or more sound stages; or
7575 (C) if the real property consists solely of one
7676 or more sound stages, be improved or renovated for that purpose or
7777 will be expanded into one or more additional sound stages;
7878 (2) is located in a metropolitan area, the principal
7979 municipality of which:
8080 (A) has a population of more than 250,000; and
8181 (B) has the adequate workforce, infrastructure,
8282 facilities, or resources to support the production and completion
8383 of moving image projects;
8484 (3) is:
8585 (A) included in a municipal utility district
8686 created under Section 52, Article III, or Section 59, Article XVI,
8787 Texas Constitution;
8888 (B) designated as a reinvestment zone for tax
8989 increment financing under Chapter 311, Tax Code; or
9090 (C) designated as a defense economic
9191 readjustment zone under Chapter 2310; and
9292 (4) is to be nominated as a media production
9393 development zone by an ordinance or order adopted by the nominating
9494 body.
9595 Sec. 485A.102. MAXIMUM NUMBER OF ZONE DESIGNATIONS
9696 THROUGHOUT STATE. There may not be more than 10 media production
9797 development zone designations under this chapter at any one time.
9898 Sec. 485A.103. NOMINATION OF MEDIA PRODUCTION DEVELOPMENT
9999 ZONE. (a) The governing body of a municipality or county,
100100 individually or in combination with other municipalities or
101101 counties, by ordinance or order, as appropriate, may nominate as a
102102 media production development zone an area within its jurisdiction
103103 that meets the criteria under Section 485A.101.
104104 (b) The governing body of a county may not nominate
105105 territory in a municipality, including extraterritorial
106106 jurisdiction of a municipality, to be included in a proposed media
107107 production development zone unless the governing body of the
108108 municipality also nominates the territory and together with the
109109 county files a joint application under Section 485A.105.
110110 Sec. 485A.104. NOMINATING ORDINANCE OR ORDER. An ordinance
111111 or order nominating an area as a media production development zone
112112 must:
113113 (1) describe precisely the area to be included in the
114114 zone by a legal description or reference to municipal or county
115115 boundaries;
116116 (2) state a finding that the area meets the
117117 requirements of this chapter;
118118 (3) summarize briefly the local financial incentives,
119119 including tax incentives, that, at the election of the nominating
120120 body, will apply to a qualified person;
121121 (4) contain a brief description of the project or
122122 activity to be conducted by a qualified person in the area; and
123123 (5) nominate the area as a media production
124124 development zone.
125125 Sec. 485A.105. APPLICATION FOR DESIGNATION. (a) For an
126126 area to be designated as a media production development zone, the
127127 nominating body, after nominating the area as a media production
128128 development zone, must send to the office a written application for
129129 designation of the area as a media production development zone.
130130 (b) The application must include:
131131 (1) a certified copy of the ordinance or order, as
132132 appropriate, nominating the area as a media production development
133133 zone;
134134 (2) appropriate supporting documents demonstrating
135135 that the area qualifies for designation as a media production
136136 development zone;
137137 (3) an estimate of the economic impact of the
138138 designation of the area as a media production development zone on
139139 the revenues of the governmental entity or entities nominating the
140140 area as a media production development zone, considering the
141141 financial incentives and benefits contemplated; and
142142 (4) any additional information the office requires.
143143 (c) Information required by Subsection (b) is for
144144 evaluation purposes only.
145145 Sec. 485A.106. REVIEW OF APPLICATION. On receipt of an
146146 application for the designation of a media production development
147147 zone, the office shall review the application to determine if the
148148 nominated area qualifies for designation as a media production
149149 development zone under this chapter.
150150 Sec. 485A.107. DESIGNATION. If the office determines that
151151 a nominated area for which a designation application has been
152152 received satisfies the criteria under Section 485A.101, the office
153153 may designate the nominated area as a media production development
154154 zone unless the office determines that the designation request
155155 should be denied for the reasons specified by Section 485A.108.
156156 Sec. 485A.108. DENIAL OF APPLICATION; NOTICE. (a) The
157157 office shall deny an application for the designation of a media
158158 production development zone if the office determines that:
159159 (1) the nominated area does not satisfy the criteria
160160 under Section 485A.101; or
161161 (2) the number of media production development zone
162162 designations at the time of the application is at the maximum limit
163163 prescribed by Section 485A.102.
164164 (b) The office shall inform the nominating body of the
165165 specific reasons for denial of an application under this section.
166166 Sec. 485A.109. PERIOD OF DESIGNATION. (a) An area may be
167167 designated as a media production development zone for a maximum of
168168 five years.
169169 (b) Except as provided by Section 485A.110, a media
170170 production development zone designation remains in effect until
171171 September 1 of the final year of the designation.
172172 Sec. 485A.110. REMOVAL OF DESIGNATION. (a) The office may
173173 remove the designation of an area as a media production development
174174 zone if the area no longer meets the criteria for designation under
175175 this chapter or by office rule adopted under this chapter.
176176 (b) The removal of a designation does not affect the
177177 validity of a tax incentive granted or accrued before the removal.
178178 [Sections 485A.111-485A.150 reserved for expansion]
179179 SUBCHAPTER D. ADMINISTRATION OF MEDIA PRODUCTION DEVELOPMENT ZONE
180180 Sec. 485A.151. ANNUAL REPORT. (a) For purposes of this
181181 section, the governing body of a media production development zone
182182 is the governing body of the municipality or county, or the
183183 governing bodies of the combination of municipalities or counties,
184184 that applied to have the area designated as a media production
185185 development zone.
186186 (b) Not later than October 1 of each year, the governing
187187 body of a media production development zone shall submit to the
188188 office a report in the form prescribed by the office.
189189 (c) The report must include for the year preceding the date
190190 of the report:
191191 (1) the use of local incentives for which the
192192 governing body provided in the ordinance or order nominating the
193193 media production development zone and the effect of those
194194 incentives on revenue;
195195 (2) the number of qualified persons engaging in a
196196 project or activity related to a sound stage in the media production
197197 development zone; and
198198 (3) the types of projects or activities engaged or to
199199 be engaged in by qualified persons in the media production
200200 development zone.
201201 [Sections 485A.152-485A.200 reserved for expansion]
202202 SUBCHAPTER E. QUALIFIED PERSON DESIGNATION AND CERTIFICATION
203203 Sec. 485A.201. QUALIFIED PERSON. A person is a qualified
204204 person if the office, for the purpose of state benefits under this
205205 chapter, or the nominating body of a media production development
206206 zone, for the purpose of local benefits, certifies that the person,
207207 not later than 18 months after the date of the zone designation:
208208 (1) will build or construct one or more sound stages in
209209 the zone;
210210 (2) will renovate a building or facility solely for
211211 the purpose of being converted into one or more sound stages in the
212212 zone; or
213213 (3) will renovate or expand one or more sound stages in
214214 the zone.
215215 Sec. 485A.202. PROHIBITION ON QUALIFIED PERSON
216216 CERTIFICATION. If the office determines that the nominating body
217217 of a media production development zone is not complying with this
218218 chapter, the office shall prohibit the certification of a qualified
219219 person in the zone until the office determines that the nominating
220220 body is complying with this chapter.
221221 Sec. 485A.203. DURATION OF DESIGNATION. Except as provided
222222 by Section 485A.204, the office's certification of a person as a
223223 qualified person is effective until the fifth anniversary of the
224224 date the designation is made, regardless of whether the media
225225 production development zone in which the qualified person is to
226226 perform its commitments under this chapter is terminated before
227227 that date.
228228 Sec. 485A.204. REMOVAL OF DESIGNATION. The office shall
229229 remove the certification of a qualified person for state benefits
230230 under this chapter if the office determines that the construction,
231231 renovation, improvement, maintenance, or expansion of a sound stage
232232 has not been completed in the media production development zone
233233 within the period prescribed by Section 485A.201.
234234 [Sections 485A.205-485A.250 reserved for expansion]
235235 SUBCHAPTER F. MEDIA PRODUCTION DEVELOPMENT ZONE BENEFITS
236236 Sec. 485A.251. EXEMPTION FROM SALES AND USE TAX. Certain
237237 items are exempt from the sales and use tax as provided by Section
238238 151.3415, Tax Code.
239239 Sec. 485A.252. MONITORING QUALIFIED PERSON COMMITMENTS.
240240 (a) The office may monitor a qualified person to determine whether
241241 and to what extent the qualified person has followed through on the
242242 commitments made by the qualified person under this chapter.
243243 (b) The office may determine that the qualified person is
244244 not entitled to a tax exemption under Section 151.3415, Tax Code, if
245245 the office determines that the qualified person:
246246 (1) is not willing to cooperate with the office in
247247 providing information needed by the office to make the
248248 determination under Subsection (a);
249249 (2) has substantially failed to follow through on the
250250 commitments made by the person under this chapter before the first
251251 anniversary of the date of the zone designation; or
252252 (3) fails to submit the report required by Section
253253 151.3415, Tax Code.
254254 SECTION 2. Subchapter H, Chapter 151, Tax Code, is amended
255255 by adding Section 151.3415 to read as follows:
256256 Sec. 151.3415. ITEMS SOLD TO OR USED TO CONSTRUCT,
257257 MAINTAIN, EXPAND, IMPROVE, OR RENOVATE SOUND STAGE IN MEDIA
258258 PRODUCTION DEVELOPMENT ZONES; REPORT. (a) In this section,
259259 "qualified person" and "media production development zone" have the
260260 meanings assigned by Section 485A.002, Government Code.
261261 (b) The sale, lease, or rental of a taxable item to a
262262 qualified person is exempted from the taxes imposed by this chapter
263263 if the item is used for:
264264 (1) the construction, maintenance, expansion,
265265 improvement, or renovation of a sound stage located in a media
266266 production development zone; or
267267 (2) the renovation of a building or facility located
268268 in a media production development zone that is to be used
269269 exclusively as a sound stage.
270270 (c) A qualified person shall submit a quarterly report to
271271 the comptroller regarding the sale, lease, or rental of taxable
272272 items for which a tax exemption is granted to the qualified person
273273 under this section. The report must be in the form and manner
274274 prescribed by the comptroller.
275275 (d) The comptroller shall share information from reports
276276 submitted under Subsection (c), on request, with the Music, Film,
277277 Television, and Multimedia Office within the office of the
278278 governor.
279279 SECTION 3. This Act takes effect September 1, 2009.