By: Seliger S.J.R. No. 21
SENATE JOINT RESOLUTION
proposing a constitutional amendment to provide for foregoing the
transfer of oil and gas production tax revenue to the economic
stabilization fund if the ending fund balance for the preceding
fiscal year is greater than 10 percent of the prior fiscal year's
total net general revenue related collections and for reducing the
rates of oil and gas production taxes by amounts sufficient to equal
the foregone transfer.
BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 49-g, Article III, Texas Constitution,
is amended by amending Subsections (c), (c-1), (c-2), (d), and (e)
and adding Subsections (c-3), (c-4), (c-5), and (c-6) to read as
follows:
(c) Not later than the 90th day of each fiscal year, the
comptroller of public accounts shall transfer from the general
revenue fund to the economic stabilization fund and the state
highway fund the sum of the amounts described by Subsections (d) and
(e) of this section, to be allocated as provided by Subsection
[Subsections] (c-1) [and (c-2)] of this section. However, if
necessary and notwithstanding the allocation [allocations]
prescribed by Subsection [Subsections] (c-1) [and (c-2)] of this
section, the comptroller shall reduce proportionately the amounts
described by Subsections (d) and (e) of this section to be
transferred and allocated to the economic stabilization fund to
prevent the amount in that fund from exceeding the limit in effect
for that biennium under Subsection (g) of this section. Revenue
transferred to the state highway fund under this subsection may be
used only for constructing, maintaining, and acquiring
rights-of-way for public roadways other than toll roads.
(c-1) Of the sum of the amounts described by Subsections (d)
and (e) of this section and required to be transferred from the
general revenue fund under Subsection (c) of this section, the
comptroller shall allocate one-half to the economic stabilization
fund and the remainder to the state highway fund[, except as
provided by Subsection (c-2) of this section].
(c-2) If the ending balance in the economic stabilization
fund for the preceding fiscal year was not greater than 10 percent
of the prior fiscal year's total net general revenue related
collections, the rate of tax imposed on oil production and the rate
of tax imposed on gas production in the current fiscal year shall be
as provided by the legislature under general law [The legislature
by general law shall provide for a procedure by which the allocation
of the sum of the amounts described by Subsections (d) and (e) of
this section may be adjusted to provide for a transfer to the
economic stabilization fund of an amount greater than the
allocation provided for under Subsection (c-1) of this section with
the remainder of that sum, if any, allocated for transfer to the
state highway fund. The allocation made as provided by that general
law is binding on the comptroller for the purposes of the transfers
required by Subsection (c) of this section].
(c-3) If the ending balance in the economic stabilization
fund for the preceding fiscal year was greater than 10 percent of
the prior fiscal year's total net general revenue related
collections, the comptroller shall not transfer any general revenue
to the economic stabilization fund during the current fiscal year
but shall transfer to the state highway fund under Subsection (c) of
this section and retain as general revenue under Subsections (d)
and (e) of this section the amounts that would have been transferred
or retained had the ending balance been less than 10 percent of the
prior fiscal year's total net general revenue related collections.
(c-4) In this section:
(1) "Tax relief set-aside" means the net amount of general
revenue, as appropriate, that would have been transferred to the
economic stabilization fund in the preceding fiscal year under
Subsection (c) of this section had the ending balance in the fund
for that fiscal year been not greater than 10 percent of the prior
fiscal year's total net general revenue related collections.
(2) "Tax-rate-cut factor" means the quotient of the tax
relief set-aside divided by the net amount of oil production tax or
gas production tax, as appropriate, that the comptroller estimates
under Article III, Section 49a(a), of this constitution will be
collected in the current fiscal year.
(c-5) If the ending balance in the economic stabilization
fund for the preceding fiscal year was greater than 10 percent of
the prior fiscal year's total net general revenue related
collections, the rate of tax imposed on oil production for the
current fiscal year shall be calculated by subtracting the
tax-rate-cut factor from one and multiplying the remainder by the
tax rate for oil production provided by the legislature under
general law. The comptroller shall establish the rate of oil
production tax not later than the 90th day of each fiscal year.
(c-6) If the ending balance in the economic stabilization
fund for the preceding fiscal year was greater than 10 percent of
the prior fiscal year's total net general revenue related
collections, the rate of tax imposed on gas production for the
current fiscal year shall be calculated by subtracting the
tax-rate-cut factor from one and multiplying the remainder by the
tax rate for gas production provide by the legislature under
general law. The comptroller shall establish the rate of gas
production tax not later than the 90th day of each fiscal year.
(d) If in the preceding fiscal year the state received from
oil production taxes a net amount greater than the net amount of oil
production taxes received by the state in the fiscal year ending
August 31, 1987, and the ending balance in the economic
stabilization fund for the preceding fiscal year was not greater
than 10 percent of the prior fiscal year's total net general revenue
related collections, the comptroller shall transfer under
Subsection (c) of this section and allocate in accordance with
Subsection [Subsections] (c-1) [and (c-2)] of this section an
amount equal to 75 percent of the difference between those amounts.
The comptroller shall retain the remaining 25 percent of the
difference as general revenue. In computing the net amount of oil
production taxes received, the comptroller may not consider refunds
paid as a result of oil overcharge litigation.
(e) If in the preceding fiscal year the state received from
gas production taxes a net amount greater than the net amount of gas
production taxes received by the state in the fiscal year ending
August 31, 1987, and the ending balance in the economic
stabilization fund for the preceding fiscal year was not greater
than 10 percent of the prior fiscal year's total net general revenue
related collections, the comptroller shall transfer under
Subsection (c) of this section and allocate in accordance with
Subsection [Subsections] (c-1) [and (c-2)] of this section an
amount equal to 75 percent of the difference between those amounts.
The comptroller shall retain the remaining 25 percent of the
difference as general revenue. For the purposes of this
subsection, the comptroller shall adjust the computation of
revenues to reflect only 12 months of collection.
SECTION 2. The following temporary provision is added to
the Texas Constitution:
TEMPORARY PROVISION. (a) This temporary provision applies
to the constitutional amendment proposed by the 86th Legislature,
Regular Session, 2019, providing for foregoing the transfer of oil
and gas production tax revenue to the economic stabilization fund
if the ending fund balance for the preceding fiscal year is greater
than 10 percent of the prior fiscal year's total net general revenue
related collections and for reducing the rates of oil and gas
production taxes by amounts sufficient to equal the foregone
transfer.
(b) The amendments to Section 49-g, Article III, of this
constitution take effect January 1, 2020, and apply only to oil
production taxes and gas production taxes imposed for a fiscal year
beginning after that date.
(c) This temporary provision expires January 1, 2020.
SECTION 3. This proposed constitutional amendment shall be
submitted to the voters at an election to be held November 5, 2019.
The ballot shall be printed to permit voting for or against the
proposition: "The constitutional amendment providing for
foregoing the transfer of oil and gas production tax revenue to the
economic stabilization fund if the ending fund balance for the
preceding fiscal year is greater than $5 billion and for reducing
the rates of oil and gas production taxes by amounts sufficient to
equal the foregone transfer."