By: Zaffirini S.B. No. 1779
A BILL TO BE ENTITLED
AN ACT
relating to ad valorem tax incentives for the recycling of water
used in oil or gas drilling or production.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 311.010(b), Tax Code, is amended to read
as follows:
(b) The board of directors of a reinvestment zone and the
governing body of the municipality or county that creates a
reinvestment zone may each enter into agreements as the board or the
governing body considers necessary or convenient to implement the
project plan and reinvestment zone financing plan and achieve their
purposes. An agreement may provide for the regulation or
restriction of the use of land by imposing conditions,
restrictions, or covenants that run with the land. An agreement may
during the term of the agreement dedicate, pledge, or otherwise
provide for the use of revenue in the tax increment fund to pay any
project costs that benefit the reinvestment zone, including project
costs relating to the cost of buildings, schools, or other
educational facilities owned by or on behalf of a school district,
community college district, or other political subdivision of this
state, railroad or transit facilities, facilities to recycle water
used in oil or gas drilling or production, affordable housing, the
remediation of conditions that contaminate public or private land
or buildings, the preservation of the facade of a private or public
building, the demolition of public or private buildings, or the
construction of a road, sidewalk, or other public infrastructure in
or out of the zone, including the cost of acquiring the real
property necessary for the construction of the road, sidewalk, or
other public infrastructure. An agreement may dedicate revenue
from the tax increment fund to pay the costs of providing affordable
housing or areas of public assembly in or out of the zone.
SECTION 2. Section 312.204(a), Tax Code, is amended to read
as follows:
(a) The governing body of a municipality eligible to enter
into tax abatement agreements under Section 312.002 may agree in
writing with the owner of taxable real property that is located in a
reinvestment zone, but that is not in an improvement project
financed by tax increment bonds, to exempt from taxation a portion
of the value of the real property or of tangible personal property
located on the real property, or both, for a period not to exceed 10
years, on the condition that the owner of the property make specific
improvements or repairs to the property, including the construction
of a facility to recycle water used in oil or gas drilling or
production. The governing body of an eligible municipality may
agree in writing with the owner of a leasehold interest in
tax-exempt real property that is located in a reinvestment zone,
but that is not in an improvement project financed by tax increment
bonds, to exempt a portion of the value of property subject to ad
valorem taxation, including the leasehold interest, improvements,
or tangible personal property located on the real property, for a
period not to exceed 10 years, on the condition that the owner of
the leasehold interest make specific improvements or repairs to the
real property, including the construction of a facility to recycle
water used in oil or gas drilling or production. A tax abatement
agreement under this section is subject to the rights of holders of
outstanding bonds of the municipality. An agreement exempting
taxable real property or leasehold interests or improvements on
tax-exempt real property may provide for the exemption of such
taxable interests in each year covered by the agreement only to the
extent its value for that year exceeds its value for the year in
which the agreement is executed. An agreement exempting tangible
personal property located on taxable or tax-exempt real property
may provide for the exemption of tangible personal property located
on the real property in each year covered by the agreement other
than tangible personal property that was located on the real
property at any time before the period covered by the agreement with
the municipality, including inventory and supplies. In a
municipality that has a comprehensive zoning ordinance, an
improvement, repair, development, or redevelopment taking place
under an agreement under this section must conform to the
comprehensive zoning ordinance.
SECTION 3. 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, 2013.