Texas 2015 - 84th Regular

Texas House Bill HB895 Compare Versions

Only one version of the bill is available at this time.

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1	1	84R2949 BEF-F
2	2	By: Miller of Fort Bend H.B. No. 895
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to a franchise or insurance premium tax credit for
8	8	contributions made to certain educational assistance
9	9	organizations.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Chapter 171, Tax Code, is amended by adding
12	12	Subchapter K to read as follows:
13	13	SUBCHAPTER K. TAX CREDIT FOR CONTRIBUTIONS TO CERTAIN EDUCATIONAL
14	14	ASSISTANCE ORGANIZATIONS
15	15	Sec. 171.551. DEFINITION. In this subchapter, "educational
16	16	assistance organization" means an organization that:
17	17	(1) according to the organization's charter, has the
18	18	primary purpose of awarding scholarships to or paying educational
19	19	expenses for eligible students in:
20	20	(A) public elementary or secondary schools
21	21	located in this state; or
22	22	(B) nonpublic elementary or secondary schools
23	23	located in this state:
24	24	(i) that meet the requirements of Section
25	25	171.553;
26	26	(ii) at which a student may fulfill this
27	27	state's compulsory attendance requirements; and
28	28	(iii) that are not in violation of the
29	29	federal Civil Rights Act of 1964 (42 U.S.C. Section 2000a et seq.);
30	30	and
31	31	(2) uses its annual revenue for the purpose provided
32	32	by Subdivision (1).
33	33	Sec. 171.552. ELIGIBILITY REQUIREMENTS FOR CERTIFICATION
34	34	OF EDUCATIONAL ASSISTANCE ORGANIZATION. An organization may apply
35	35	to the comptroller for certification as a certified educational
36	36	assistance organization. To qualify for certification, the
37	37	organization:
38	38	(1) must:
39	39	(A) be exempt from federal tax under Section
40	40	501(a) of the Internal Revenue Code by being listed as an exempt
41	41	organization in Section 501(c)(3) of that code;
42	42	(B) be in good standing with the state;
43	43	(C) be located in the state;
44	44	(D) allocate at least 90 percent of its annual
45	45	revenue from contributions that are designated for scholarships or
46	46	educational expense assistance for eligible students under this
47	47	subchapter for student scholarships and assistance for educational
48	48	expenses, including tuition, transportation, textbooks, and other
49	49	supplies, and for other related educational expense assistance as
50	50	described by this section;
51	51	(E) award scholarships and assistance for
52	52	qualifying educational expenses to eligible students who
53	53	demonstrate the greatest financial and academic need;
54	54	(F) give each donor a receipt for money
55	55	contributed to the organization that includes the name of the
56	56	organization, the name of the donor, the amount of the
57	57	contribution, the information required by Section 171.556(c), and
58	58	any other information required by the comptroller;
59	59	(G) demonstrate experience and technical
60	60	expertise in:
61	61	(i) accepting, processing, and tracking
62	62	applications for scholarships or educational expense assistance;
63	63	and
64	64	(ii) awarding scholarships to students in
65	65	primary or secondary schools;
66	66	(H) agree to be independently audited on an
67	67	annual basis and file the audit with the comptroller; and
68	68	(I) disburse within two academic years of receipt
69	69	contributions received from and designated by taxable entities for
70	70	scholarships or educational expense assistance under this
71	71	subchapter; and
72	72	(2) may not:
73	73	(A) award all scholarships under this subchapter
74	74	to students who attend a particular school or pay educational
75	75	expenses incurred only at a particular school;
76	76	(B) provide to a student a scholarship in an
77	77	annual amount that exceeds the amounts provided under Section
78	78	171.557(a) unless the money used to provide the portion of the
79	79	scholarship in excess of that amount was contributed by a person
80	80	other than an entity that notifies the organization under Section
81	81	171.556(c) that the entity may apply for a tax credit for the
82	82	contribution; and
83	83	(C) provide to a student educational expense
84	84	assistance in excess of the amount provided under Section
85	85	171.557(b) per academic year, including assistance for:
86	86	(i) facility fees;
87	87	(ii) textbooks;
88	88	(iii) school supplies;
89	89	(iv) tutoring;
90	90	(v) academic after-school programs;
91	91	(vi) school or lab fees;
92	92	(vii) before-school or after-school child
93	93	care; and
94	94	(viii) transportation expenses, including
95	95	the cost to transfer from one public school to another.
96	96	Sec. 171.553. NONPUBLIC SCHOOL REQUIREMENTS. A certified
97	97	educational assistance organization may not award scholarships to
98	98	or pay educational expenses for eligible students enrolled in
99	99	nonpublic schools unless the nonpublic school executes a notarized
100	100	affidavit, with supporting documentation, concerning the school's
101	101	qualification for scholarships and educational expense assistance
102	102	for eligible students who receive assistance from a certified
103	103	educational assistance organization, including evidence of:
104	104	(1) accreditation or of actively being in the process
105	105	of accreditation by the Texas Education Agency or by an
106	106	organization recognized by the Texas Private School Accreditation
107	107	Commission;
108	108	(2) annual administration of a nationally
109	109	norm-referenced assessment instrument or the appropriate
110	110	assessment instrument required under Section 39.023, Education
111	111	Code;
112	112	(3) a valid certificate of occupancy; and
113	113	(4) policy statements regarding:
114	114	(A) admissions;
115	115	(B) curriculum;
116	116	(C) safety;
117	117	(D) food service inspection; and
118	118	(E) student to teacher ratios.
119	119	Sec. 171.554. ELIGIBILITY. A taxable entity is eligible
120	120	for a credit against the tax imposed under this chapter in the
121	121	amount and under the conditions and limitations provided by this
122	122	subchapter.
123	123	Sec. 171.555. ELIGIBILITY OF STUDENTS; INCLUSION IN
124	124	CALCULATION OF EQUALIZED WEALTH LEVEL. (a) To qualify for
125	125	assistance from a certified educational assistance organization
126	126	under this subchapter:
127	127	(1) a student:
128	128	(A) must:
129	129	(i) be in foster care;
130	130	(ii) be in institutional care; or
131	131	(iii) have a household income not greater
132	132	than 200 percent of the income guidelines necessary to qualify for
133	133	the national free or reduced-price lunch program established under
134	134	42 U.S.C. Section 1751 et seq.; and
135	135	(B) must:
136	136	(i) have been enrolled in a public school
137	137	during the preceding school year;
138	138	(ii) be starting school in the state for the
139	139	first time;
140	140	(iii) be the sibling of a student who is
141	141	eligible; or
142	142	(iv) if the person attends a nonpublic
143	143	school, qualify as a student who is not counted toward a public
144	144	school's average daily attendance during the year in which the
145	145	student receives the scholarship or educational expense assistance
146	146	to attend the school, except as provided by Subsection (b); or
147	147	(2) a student must have previously qualified under
148	148	Subdivision (1).
149	149	(b) A student who receives a scholarship under this
150	150	subchapter is included in the weighted average daily attendance of
151	151	the school district the student would otherwise attend for purposes
152	152	of determining the district's equalized wealth level under Chapter
153	153	41, Education Code.
154	154	Sec. 171.556. CREDIT FOR CONTRIBUTIONS. (a) A taxable
155	155	entity may claim a credit under this subchapter only for money
156	156	contributed to a certified educational assistance organization and
157	157	designated for scholarships or educational expense assistance for
158	158	eligible students.
159	159	(b) A taxable entity may not claim a credit under this
160	160	subchapter for a contribution made to a certified educational
161	161	assistance organization if:
162	162	(1) the taxable entity requires that the contribution
163	163	benefit a particular person or school; or
164	164	(2) the contribution is designated to provide a
165	165	scholarship or educational expense assistance for a taxable entity
166	166	employee or for a spouse or dependent of a taxable entity employee.
167	167	(c) An entity shall notify a certified educational
168	168	assistance organization in writing when the entity makes a
169	169	contribution if the entity may apply for a tax credit under this
170	170	subchapter or Chapter 230, Insurance Code, for the contribution.
171	171	An entity may not claim a credit for the contribution unless the
172	172	entity provides the notification at the time the contribution is
173	173	made. The certified educational assistance organization shall
174	174	indicate on the receipt provided under Section 171.552(1)(F) that
175	175	the entity made the notification under this subsection.
176	176	Sec. 171.557. LIMIT ON AMOUNT OF SCHOLARSHIP OR EDUCATIONAL
177	177	EXPENSE ASSISTANCE. (a) The maximum scholarship amount a
178	178	certified educational assistance organization may award to a
179	179	student under this subchapter using money contributed by an entity
180	180	that notifies the organization under Section 171.556(c) that the
181	181	entity may apply for a tax credit for the contribution may not
182	182	exceed 60 percent of the amount of funding equal to the statewide
183	183	average amount to which a school district would be entitled under
184	184	the Foundation School Program under Chapter 42, Education Code, for
185	185	a student in average daily attendance.
186	186	(b) The maximum educational expense assistance a certified
187	187	educational assistance organization may award to a student under
188	188	this subchapter may not exceed $500 for the 2016 state fiscal year,
189	189	increased by five percent each subsequent year.
190	190	Sec. 171.558. AMOUNTS; LIMITATION ON TOTAL CREDITS. (a)
191	191	Subject to Subsections (b) and (c), the amount of a taxable entity's
192	192	annual credit is equal to the lesser of the amount of the qualifying
193	193	contributions made by the taxable entity or 50 percent of the
194	194	taxable entity's tax liability under this chapter.
195	195	(b) For the 2016 state fiscal year, the total amount of tax
196	196	credits that may be claimed by all entities under this subchapter
197	197	and Chapter 230, Insurance Code, may not exceed $65 million. For
198	198	each subsequent state fiscal year, the total amount of tax credits
199	199	that may be claimed is an amount equal to 105 percent of the total
200	200	amount of tax credits that may be claimed in the previous state
201	201	fiscal year.
202	202	(c) The comptroller by rule shall prescribe procedures by
203	203	which the comptroller may allocate credits under this subchapter.
204	204	The procedures must provide that credits are allocated on a
205	205	first-come, first-served basis, based on the date the contribution
206	206	was initially made.
207	207	(d) The comptroller may require a taxable entity to notify
208	208	the comptroller of the amount the taxable entity intends or expects
209	209	to claim under this subchapter before the beginning of a state
210	210	fiscal year or at any other time required by the comptroller.
211	211	Sec. 171.559. APPLICATION FOR CREDIT. (a) A taxable entity
212	212	must apply for a credit under this subchapter on or with the tax
213	213	report for the period for which the credit is claimed.
214	214	(b) The comptroller shall adopt a form for the application
215	215	for the credit. A taxable entity must use this form in applying for
216	216	the credit and submit with the application the receipt issued under
217	217	Section 171.552(1)(F), including the information required by
218	218	Section 171.556(c).
219	219	Sec. 171.560. RULES; PROCEDURES. (a) The comptroller
220	220	shall adopt rules and procedures to implement, administer, and
221	221	enforce this subchapter.
222	222	(b) A rule adopted under Subsection (a) is binding on any
223	223	state or local governmental entity, including a political
224	224	subdivision, as necessary to implement, administer, and enforce
225	225	this subchapter.
226	226	Sec. 171.561. ASSIGNMENT PROHIBITED; EXCEPTION. A taxable
227	227	entity may not convey, assign, or transfer the credit allowed under
228	228	this subchapter to another taxable entity unless all assets of the
229	229	taxable entity are conveyed, assigned, or transferred in the same
230	230	transaction.
231	231	Sec. 171.562. REVOCATION. (a) The comptroller shall
232	232	revoke a certification provided under Section 171.552 if the
233	233	comptroller finds that a certified educational assistance
234	234	organization:
235	235	(1) is no longer eligible under Section 171.552; or
236	236	(2) intentionally and substantially violates this
237	237	subchapter.
238	238	(b) Revocation of a certification under this section does
239	239	not affect the validity of a tax credit relating to a contribution
240	240	made before the date of revocation.
241	241	SECTION 2. Subtitle B, Title 3, Insurance Code, is amended
242	242	by adding Chapter 230 to read as follows:
243	243	CHAPTER 230. CREDIT AGAINST PREMIUM TAXES
244	244	FOR CERTAIN CONTRIBUTIONS
245	245	SUBCHAPTER A. GENERAL PROVISIONS
246	246	Sec. 230.001. DEFINITIONS. In this chapter:
247	247	(1) "Educational assistance organization" has the
248	248	meaning assigned by Section 171.551, Tax Code.
249	249	(2) "State premium tax liability" means any liability
250	250	incurred by an entity under Chapters 221 through 226.
251	251	SUBCHAPTER B. CREDIT
252	252	Sec. 230.051. CREDIT. (a) An entity is eligible for a
253	253	credit against the entity's state premium tax liability in the
254	254	amount and under the conditions and limitations provided by this
255	255	chapter.
256	256	(b) The amount of the credit is equal to the lesser of the
257	257	amount of contributions made to a certified educational assistance
258	258	organization or 50 percent of the entity's state premium tax
259	259	liability if the contributions and the organizations that received
260	260	the contributions meet the requirements prescribed by Subchapter K,
261	261	Chapter 171, Tax Code.
262	262	Sec. 230.052. LIMITATION. (a) Subject to Subsection (c),
263	263	the total credit claimed under this chapter for a taxable year may
264	264	not exceed the lesser of the amount determined under Subsection (b)
265	265	or 50 percent of the amount of the entity's state premium tax
266	266	liability for the taxable year after any other applicable credits.
267	267	(b) For the 2016 state fiscal year, the total amount of tax
268	268	credits that may be claimed under this chapter and Subchapter K,
269	269	Chapter 171, Tax Code, may not exceed $65 million. For each
270	270	subsequent state fiscal year, the total amount of tax credits that
271	271	may be claimed is an amount equal to 105 percent of the total amount
272	272	of tax credits that may be claimed in the previous state fiscal
273	273	year.
274	274	(c) The comptroller by rule shall prescribe procedures by
275	275	which the comptroller may allocate credits under this chapter. The
276	276	procedures must provide that credits are allocated on a first-come,
277	277	first-served basis, based on the date the contribution was
278	278	initially made.
279	279	(d) The comptroller may require an entity to notify the
280	280	comptroller of the amount the entity intends or expects to claim
281	281	under this chapter before the beginning of a state fiscal year or at
282	282	any other time required by the comptroller.
283	283	Sec. 230.053. APPLICATION FOR CREDIT. (a) An entity must
284	284	apply for a credit under this chapter on or with the tax return for
285	285	the taxable year for which the credit is claimed and submit with the
286	286	application the receipt issued under Section 171.552(1)(F), Tax
287	287	Code, including the information required by Section 171.556(c), Tax
288	288	Code.
289	289	(b) The comptroller shall adopt a form for the application
290	290	for the credit. An entity must use this form in applying for the
291	291	credit.
292	292	Sec. 230.054. RULES; PROCEDURES. (a) The comptroller
293	293	shall adopt rules and procedures to implement, administer, and
294	294	enforce this chapter.
295	295	(b) A rule adopted under Subsection (a) is binding on any
296	296	state or local governmental entity, including a political
297	297	subdivision, as necessary to implement, administer, and enforce
298	298	this chapter.
299	299	Sec. 230.055. ASSIGNMENT PROHIBITED; EXCEPTION. An entity
300	300	may not convey, assign, or transfer the credit allowed under this
301	301	chapter to another entity unless all of the assets of the entity are
302	302	conveyed, assigned, or transferred in the same transaction.
303	303	SECTION 3. (a) The constitutionality and other validity
304	304	under the state or federal constitution of all or any part of
305	305	Subchapter K, Chapter 171, Tax Code, or Chapter 230, Insurance
306	306	Code, as added by this Act, may be determined in an action for
307	307	declaratory judgment in a district court in Travis County under
308	308	Chapter 37, Civil Practice and Remedies Code.
309	309	(b) An appeal of a declaratory judgment or order, however
310	310	characterized, of a district court, including an appeal of the
311	311	judgment of an appellate court, holding or otherwise determining
312	312	that all or any part of Subchapter K, Chapter 171, Tax Code, or
313	313	Chapter 230, Insurance Code, as added by this Act, is
314	314	constitutional or unconstitutional, or otherwise valid or invalid,
315	315	under the state or federal constitution is an accelerated appeal.
316	316	(c) If the judgment or order is interlocutory, an
317	317	interlocutory appeal may be taken from the judgment or order and is
318	318	an accelerated appeal.
319	319	(d) A district court in Travis County may grant or deny a
320	320	temporary or otherwise interlocutory injunction or a permanent
321	321	injunction on the grounds of the constitutionality or
322	322	unconstitutionality, or other validity or invalidity, under the
323	323	state or federal constitution of all or any part of Subchapter K,
324	324	Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added by
325	325	this Act.
326	326	(e) There is a direct appeal to the supreme court from an
327	327	order, however characterized, of a trial court granting or denying
328	328	a temporary or otherwise interlocutory injunction or a permanent
329	329	injunction on the grounds of the constitutionality or
330	330	unconstitutionality, or other validity or invalidity, under the
331	331	state or federal constitution of all or any part of Subchapter K,
332	332	Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added by
333	333	this Act.
334	334	(f) The direct appeal is an accelerated appeal.
335	335	(g) This section exercises the authority granted by Section
336	336	3-b, Article V, Texas Constitution.
337	337	(h) The filing of a direct appeal under this section will
338	338	automatically stay any temporary or otherwise interlocutory
339	339	injunction or permanent injunction granted in accordance with this
340	340	section pending final determination by the supreme court, unless
341	341	the supreme court makes specific findings that the applicant
342	342	seeking such injunctive relief has pleaded and proved that:
343	343	(1) the applicant has a probable right to the relief it
344	344	seeks on final hearing; and
345	345	(2) the applicant will suffer a probable injury that
346	346	is imminent and irreparable, and that the applicant has no other
347	347	adequate legal remedy.
348	348	(i) An appeal under this section, including an
349	349	interlocutory, accelerated, or direct appeal, is governed, as
350	350	applicable, by the Texas Rules of Appellate Procedure, including
351	351	Rules 25.1(d)(6), 26.1(b), 28.1, 28.3, 32.1(g), 37.3(a)(1),
352	352	38.6(a) and (b), 40.1(b), and 49.4.
353	353	SECTION 4. A credit may be claimed under Subchapter K,
354	354	Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added by
355	355	this Act, only for a contribution made on or after the effective
356	356	date of this Act.
357	357	SECTION 5. Not later than February 15, 2016, the
358	358	comptroller of public accounts shall adopt rules as provided by
359	359	Section 171.560(a), Tax Code, and Section 230.054(a), Insurance
360	360	Code, as added by this Act.
361	361	SECTION 6. This Act takes effect January 1, 2016.