82R4650 CJC-D
By: Ellis S.B. No. 1051
A BILL TO BE ENTITLED
AN ACT
relating to a periodic review of state and local tax preferences.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 3, Government Code, is amended
by adding Chapter 320A to read as follows:
CHAPTER 320A. REVIEW OF STATE AND LOCAL TAX PREFERENCES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 320A.001. DEFINITIONS. In this chapter:
(1) "Commission" means the select commission on
periodic tax preference review.
(2) "Tax preference" means a credit, discount,
exclusion, exemption, refund, special valuation, special
accounting treatment, special rate, or special method of reporting
authorized by state law that relates to a state or local tax imposed
in this state.
[Sections 320A.002-320A.050 reserved for expansion]
SUBCHAPTER B. SCHEDULE FOR PERIODIC REVIEW
OF STATE AND LOCAL TAX PREFERENCES
Sec. 320A.051. SELECT COMMISSION ON PERIODIC TAX PREFERENCE
REVIEW. The select commission on periodic tax preference review is
composed of:
(1) three members of the house of representatives,
appointed by the speaker of the house of representatives;
(2) three members of the senate, appointed by the
lieutenant governor;
(3) eight public members representing the geographic
and cultural diversity of this state, composed of the following:
(A) four members appointed by the lieutenant
governor, of which one is a representative of the business
community in this state; and
(B) four members appointed by the speaker of the
house of representatives, of which one is a representative of the
business community in this state and one is a representative of an
organization that advocates for public policies that benefit
low- and moderate-income families in this state; and
(4) the comptroller.
Sec. 320A.052. TERMS. The members of the commission serve
two-year terms that expire December 31 of each even-numbered year.
Sec. 320A.053. VACANCY. If a vacancy occurs, the
individual who originally appointed the vacating member shall
appoint an individual to fill the vacancy for the remainder of the
unexpired term.
Sec. 320A.054. OFFICERS. (a) The speaker of the house of
representatives shall select one member of the commission appointed
under Section 320A.051(1) to serve as chair of the commission.
(b) The lieutenant governor shall select one member of the
commission appointed under Section 320A.051(2) to serve as vice
chair of the commission.
Sec. 320A.055. MEETINGS. The commission shall meet at the
call of the chair.
Sec. 320A.056. STAFF. On the commission's request, the
Legislative Budget Board, the Texas Legislative Council, the office
of the governor, the comptroller, the senate, and the house of
representatives shall provide staff as necessary to assist the
commission in performing the commission's duties.
Sec. 320A.057. COOPERATION BY OTHER STATE ENTITIES. The
commission may request assistance from the comptroller or any other
state agency, department, or office if the commission needs
assistance to perform the commission's duties. The comptroller or
other agency, department, or office shall provide the requested
assistance.
Sec. 320A.058. EXPENSES. The operating expenses of the
commission shall be paid from the contingent expense funds of the
senate and the house of representatives, as agreed by those
entities. The commission members are entitled to reimbursement
from those funds for expenses incurred by the members in
implementing this chapter.
Sec. 320A.059. DEVELOPMENT AND BIENNIAL MODIFICATION OF
STATE AND LOCAL TAX PREFERENCE REVIEW SCHEDULE. (a) The commission
shall:
(1) identify each state tax preference and each type
of local tax preference;
(2) develop a state and local tax preference review
schedule under which each identified tax preference is reviewed
once during each 12-year period; and
(3) specifically identify on the schedule:
(A) each of the tax preferences the Legislative
Budget Board must review for purposes of the next report due under
Section 320A.151;
(B) any tax preference described by Paragraph (A)
that reduces by less than one-fourth of one percent the total
revenue derived from the tax to which the tax preference applies and
that the commission recommends for an abbreviated review by the
Legislative Budget Board; and
(C) the components of the review specified by
Section 320A.101 that the commission recommends are unnecessary
with respect to a tax preference recommended for an abbreviated
review.
(b) Except as provided in Subsection (c), in developing the
schedule, the commission shall schedule the tax preferences for
review in the order in which the tax preferences were enacted or
authorized.
(c) In developing the schedule, the commission may:
(1) schedule for review at the same time all tax
preferences authorized in the same chapter of the Tax Code; and
(2) schedule the initial review of a tax preference
that has an expiration date for any date the commission determines
is appropriate.
(d) The commission shall revise the schedule biennially
only to:
(1) add to the schedule a tax preference that was
enacted or authorized after the commission developed the most
recent schedule;
(2) delete from the schedule a tax preference that was
repealed after the commission developed the most recent schedule;
(3) update the review dates of the tax preferences for
which reviews were conducted after the commission developed the
most recent schedule; and
(4) update the tax preferences identified under
Subsection (a)(3).
Sec. 320A.060. PUBLIC COMMENT. The commission shall
provide a process by which the public may comment on the state and
local tax preference review schedule under Section 320A.059. The
commission shall consider those comments in developing or revising
the schedule.
Sec. 320A.061. SCHEDULE PROVIDED TO LEGISLATIVE BUDGET
BOARD. Not later than December 1 of each odd-numbered year, the
commission shall provide the state and local tax preference review
schedule to the Legislative Budget Board.
[Sections 320A.062-320A.100 reserved for expansion]
SUBCHAPTER C. CONDUCT OF REVIEW OF STATE
AND LOCAL TAX PREFERENCES
Sec. 320A.101. PERIODIC REVIEW OF TAX PREFERENCES. The
Legislative Budget Board shall periodically review each state tax
preference and each type of local tax preference according to the
state and local tax preference review schedule provided by the
commission under Section 320A.061. In reviewing a tax preference,
the board shall:
(1) determine the intended purpose of the tax
preference; and
(2) evaluate:
(A) whether the tax preference accomplishes its
intended purpose;
(B) whether the tax preference is inefficient,
ineffective, or unnecessary, or the intended purpose of the tax
preference is a low priority for this state; and
(C) the effect of the tax preference on economic
development, the number of high wage jobs, funding for public
services, the distribution of the tax burden by income class and
industry or business class, and total income by income class in this
state.
Sec. 320A.102. COOPERATION BY OTHER STATE ENTITIES. The
Legislative Budget Board may request assistance from the
comptroller or any other state agency, department, or office if the
board needs assistance to perform the review required by Section
320A.101. The comptroller or other agency, department, or office
shall provide the requested assistance.
[Sections 320A.103-320A.150 reserved for expansion]
SUBCHAPTER D. RECOMMENDATIONS REGARDING REVIEWED TAX PREFERENCES
Sec. 320A.151. PRELIMINARY REPORT. Not later than
September 1 of each even-numbered year, the Legislative Budget
Board shall provide to the commission a preliminary report on the
reviews of tax preferences identified under Section
320A.059(a)(3)(A). The report must include drafts of any proposed
legislation needed to implement the board's recommendations.
Sec. 320A.152. FINAL REPORT. (a) The commission shall
review and may modify the preliminary report and proposed
legislation provided to the commission under Section 320A.151.
(b) Not later than December 1 of each even-numbered year,
the commission shall provide to the governor and the presiding
officers of the senate finance committee and the house ways and
means committee a final report on the reviews of tax preferences
identified under Section 320A.059(a)(3)(A). The final report must
include:
(1) as to each tax preference examined, whether the
commission recommends:
(A) continuing the tax preference;
(B) amending a provision relating to the tax
preference; or
(C) repealing the tax preference;
(2) a complete explanation of each of the commission's
recommendations;
(3) proposed legislation necessary to implement the
findings of the final report; and
(4) a description of any deviations from the
preliminary report provided under Section 320A.151 that are made by
the final report, and a description of the reasons for each
deviation.
Sec. 320A.153. PUBLIC HEARING ON FINAL REPORT. The senate
finance committee and the house ways and means committee shall hold
a joint public hearing on the final report and proposed legislation
provided under Section 320A.152.
SECTION 2. The lieutenant governor and the speaker of the
house of representatives shall appoint the initial members of the
select commission on periodic tax preference review not later than
October 1, 2011. Notwithstanding Section 320A.052, Government
Code, as added by this Act, the terms of the initial members of the
commission expire December 31, 2012.
SECTION 3. The select commission on periodic tax preference
review shall:
(1) notwithstanding Section 320A.061, Government
Code, as added by this Act, submit the initial state and local tax
preference review schedule required under that section not later
than January 15, 2012; and
(2) submit the initial final report required by
Section 320A.152, Government Code, as added by this Act, not later
than December 1, 2012.
SECTION 4. The Legislative Budget Board shall submit the
initial preliminary report required by Section 320A.151,
Government Code, as added by this Act, not later than September 1,
2012.
SECTION 5. 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, 2011.