83R12312 CJC-D
By: Dutton H.B. No. 3409
A BILL TO BE ENTITLED
AN ACT
relating to a periodic review and expiration dates 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 an abatement, credit,
discount, exclusion, exemption, limitation on appraised value,
refund, special valuation, special accounting treatment, special
appraisal method or provision, special rate, or special method of
reporting authorized by state law or the state constitution that
relates to a state or local tax imposed in this state.
SUBCHAPTER B. SELECT COMMISSION ON PERIODIC TAX PREFERENCE REVIEW
Sec. 320A.051. COMPOSITION OF COMMISSION. The select
commission on periodic tax preference review is composed of:
(1) five members of the house of representatives,
appointed by the speaker of the house of representatives;
(2) five members of the senate, appointed by the
lieutenant governor; and
(3) 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 or the
individual's successor 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 to assist the commission in
performing the commission's duties.
Sec. 320A.057. COOPERATION BY OTHER STATE ENTITIES. The
commission may request the assistance of any state agency,
department, or office if the commission needs assistance to perform
the commission's duties. The agency, department, or office shall
provide the requested assistance.
Sec. 320A.058. EXPENSES. The operating expenses of the
commission shall be paid from available funds of the office of the
governor and 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.
SUBCHAPTER C. POWERS AND DUTIES OF COMMISSION
Sec. 320A.101. 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 six-year period; and
(3) specifically identify on the schedule:
(A) each of the tax preferences the commission
must review for purposes of the next report due under Section
320A.153;
(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; and
(C) the components of the review specified by
Section 320A.104 that the commission recommends are unnecessary
with respect to a tax preference recommended for an abbreviated
review.
(b) 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, except that the
commission may schedule the initial review of a tax preference that
has an expiration date for any date the commission determines is
appropriate.
(c) 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.102. 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.101. The
commission shall consider those comments in developing or revising
the schedule.
Sec. 320A.103. COMPLETION OF SCHEDULE. The state and local
tax preference review schedule must be completed not later than
December 1 of each odd-numbered year.
Sec. 320A.104. PERIODIC REVIEW OF STATE AND LOCAL TAX
PREFERENCES. The commission shall review each state tax preference
and each type of local tax preference according to the state and
local tax preference review schedule developed under Section
320A.101. In reviewing a tax preference, the commission 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 intended purpose of the tax
preference could be accomplished through a more cost-effective
method; and
(C) the effect of the tax preference on economic
development in this state.
SUBCHAPTER D. RECOMMENDATIONS REGARDING REVIEWED TAX PREFERENCES
Sec. 320A.151. PRELIMINARY REPORT. Not later than
September 1 of each even-numbered year, the commission shall file a
preliminary report on the reviews of tax preferences identified
under Section 320A.101(a)(3)(A) with the senate finance committee
and the house ways and means committee. The report must include
drafts of any proposed legislation needed to implement the
commission's recommendations.
Sec. 320A.152. REVIEW AND COMMENT. The senate finance
committee and the house ways and means committee may review the
preliminary report and proposed legislation and submit comments to
the commission. Comments must be submitted not later than October
15 of each even-numbered year.
Sec. 320A.153. FINAL REPORT. (a) The commission may modify
the preliminary report and proposed legislation in response to the
comments received under Section 320A.152.
(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.101(a)(3)(A) and proposed
legislation necessary to implement the commission's
recommendations.
Sec. 320A.154. 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.153.
SUBCHAPTER E. EXPIRATION OF TAX PREFERENCES
Sec. 320A.201. EXPIRATION; REQUIRED STATEMENT. (a) A tax
preference included in a final report expires on the second
anniversary of the date the final report is submitted under Section
320A.153(b) unless reauthorized by law.
(b) Unless reauthorized by law, each tax preference enacted
or reauthorized by the legislature that becomes law on or after
September 1, 2014, must state the expiration date of the preference
and provide that the preference expires on that date. The
expiration date may not be later than the sixth anniversary of the
effective date of the law enacting or reauthorizing the tax
preference.
(c) A tax preference to which Subsection (b) applies that
does not include the provision required by that subsection expires
on the sixth anniversary of the effective date of the law enacting
or reauthorizing the preference.
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
January 31, 2014. Notwithstanding Section 320A.052, Government
Code, as added by this Act, the terms of the initial members of the
commission expire December 31, 2014.
SECTION 3. Notwithstanding Section 320A.103, Government
Code, as added by this Act, the select commission on periodic tax
preference review shall submit:
(1) the initial state and local tax preference review
schedule required by that section not later than January 15, 2014;
(2) the initial preliminary report required by Section
320A.151, Government Code, as added by this Act, not later than
September 1, 2014; and
(3) the initial final report required by Section
320A.153, Government Code, as added by this Act, not later than
December 1, 2014.
SECTION 4. This Act takes effect January 1, 2014, but only
if the constitutional amendment proposed by the 83rd Legislature,
Regular Session, 2013, requiring the legislature to provide for a
periodic review of state and local tax preferences and providing
for the expiration of certain tax preferences six years after the
effective dates of the laws enacting or reauthorizing the
preferences, or at another time prescribed by the legislature,
unless reauthorized by law, is approved by the voters. If that
amendment is not approved by the voters, this Act has no effect.