87S20199 CJC-D
By: Slaton H.B. No. 120
A BILL TO BE ENTITLED
AN ACT
relating to a credit against the ad valorem taxes imposed on
property owned by a person who makes a donation to the state for the
purpose of border security and reimbursement to taxing units for
the revenue loss incurred as a result of the credit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 31, Tax Code, is amended by adding
Section 31.038 to read as follows:
Sec. 31.038. TAX CREDIT FOR DONATIONS TO SUPPORT BORDER
SECURITY EFFORTS. (a) In this section:
(1) "Border security efforts" means programs or
activities undertaken and funded by this state or an agency of this
state to secure the international border of this state with the
United Mexican States.
(2) "Business entity" means a legal entity, including
a corporation or partnership, that is formed for the purpose of
making a profit.
(3) "Principal office" means the location where the
decision makers for a business entity conduct the daily affairs of
the business.
(b) An owner of property is entitled to a credit against the
taxes imposed in a tax year on that property by a taxing unit if the
owner:
(1) is:
(A) a United States citizen residing in this
state; or
(B) a business entity whose principal office is
located in this state; and
(2) donates money to this state in support of border
security efforts.
(c) The amount of the credit to which a property owner is
entitled under this section is equal to the lesser of:
(1) the total amount of money the property owner
donated to this state in support of border security efforts during
the preceding 12-month period; or
(2) the total amount of taxes imposed on the property
by all of the taxing units that tax the property.
(d) The amount of the credit must first be applied against
the taxes imposed on the property by the school district in which
the property is located. If, after applying the credit against the
taxes imposed on the property by the school district, any amount of
the credit remains, that amount applies against the taxes imposed
on the property by each taxing unit in which the property is located
other than the school district in an amount computed by multiplying
the remaining amount of the credit by a fraction, the numerator of
which is the amount of taxes imposed on the property by the
applicable taxing unit and the denominator of which is the total
amount of taxes imposed on the property by all of the taxing units
other than the school district that tax the property.
(e) The property owner must file an application each year
with the chief appraiser of the appraisal district in which the
property is located to receive a credit under this section. The
application must include an affidavit stating the amount of the
donations described by Subsection (b)(2) made by the property owner
during the preceding 12-month period and include any relevant
information or documentation required by the application form.
(f) The chief appraiser shall forward a copy of the
application to the assessor for each taxing unit that taxes the
property. The assessors for the taxing units shall consult with one
another as necessary to compute the amount of credit, if any, to be
granted by each taxing unit.
(g) The comptroller shall adopt rules for the
implementation and administration of this section, including rules
prescribing the form of an application for the credit and
specifying the 12-month period during which donations may be used
to calculate the credit.
SECTION 2. Section 481.078, Government Code, is amended by
amending Subsection (c) and adding Subsection (d-2) to read as
follows:
(c) Except as provided by Subsections (d), [and] (d-1), and
(d-2), the fund may be used only for economic development,
infrastructure development, community development, job training
programs, and business incentives.
(d-2) The fund may be used by the comptroller to make border
security tax credit reimbursement payments in the manner prescribed
by Section 140.010, Local Government Code.
SECTION 3. Chapter 140, Local Government Code, is amended
by adding Section 140.010 to read as follows:
Sec. 140.010. BORDER SECURITY TAX CREDIT REIMBURSEMENT
PAYMENTS. (a) In this section, "taxing unit" and "tax year" have
the meanings assigned by Section 1.04, Tax Code.
(b) A taxing unit is entitled to a border security tax
credit reimbursement payment from the state for a tax year for which
the chief appraiser of the appraisal district in which the taxing
unit participates approves an application for a credit under
Section 31.038, Tax Code.
(c) The amount of the border security tax credit
reimbursement payment is equal to the revenue loss incurred by the
taxing unit as a result of the credit under Section 31.038, Tax
Code, in the tax year for which the border security tax credit
reimbursement payment is sought.
(d) Not later than April 1 of the year following the tax year
for which the border security tax credit reimbursement payment is
sought, the taxing unit may submit an application to the
comptroller to receive a border security tax credit reimbursement
payment for that tax year. The application must be made on a form
prescribed by the comptroller.
(e) A taxing unit that does not submit an application to the
comptroller by the date prescribed by Subsection (d) is not
entitled to a border security tax credit reimbursement payment for
the tax year for which the deadline applies.
(f) The comptroller shall review each application by a
taxing unit to determine whether the taxing unit is entitled to a
border security tax credit reimbursement payment. If the
comptroller determines that the taxing unit is entitled to the
payment, the comptroller shall remit the payment to the taxing unit
not later than the 30th day after the date the application for the
payment is made.
(g) The comptroller shall make border security tax credit
reimbursement payments using money in the Texas Enterprise Fund.
In the event that the Texas Enterprise Fund does not maintain a
positive balance on the date the comptroller is required to make a
payment, the comptroller shall make the payment using undedicated
money in the general revenue fund.
(h) The comptroller may adopt rules to implement and
administer this section.
SECTION 4. This Act applies only to ad valorem taxes imposed
for a tax year beginning on or after the effective date of this Act.
SECTION 5. This Act takes effect January 1, 2023, but only
if the constitutional amendment proposed by the 87th Legislature,
2nd Called Session, 2021, to authorize the legislature to provide
for a credit against the ad valorem taxes imposed on property owned
by a person who makes a donation to the state for the purpose of
border security and to provide for the reimbursement of political
subdivisions for the revenue loss incurred as a result of the credit
is approved by the voters. If that amendment is not approved by the
voters, this Act has no effect.