H.B. No. 2424




AN ACT
relating to technical changes to taxes and fees administered by the comptroller; providing penalties. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 161.122, Health and Safety Code, is amended by adding Subsection (f) to read as follows: (f) A person commits an offense if the person places or authorizes the placement of a sign in violation of this section. An offense under this subsection is a Class C misdemeanor. SECTION 2. Article 1.16(b), Insurance Code, is amended to read as follows: (b) Assessments for the expenses of such domestic examination which shall be sufficient to meet all the expenses and disbursements necessary to comply with the provisions of the laws of Texas relating to the examination of insurance companies and to comply with the provisions of this Article and Articles 1.17 and 1.18 of this Code, shall be made by the State Board of Insurance upon the corporations or associations to be examined taking into consideration annual premium receipts, and/or admitted assets that are not attributable to 90 percent of pension plan contracts as defined in Section 818(a) of the Internal Revenue Code of 1986 (26 U.S.C. Section 818(a)), and/or insurance in force; provided such assessments shall be made and collected as follows: (1) expenses attributable directly to a specific examination including employees' salaries and expenses and expenses provided by Article 1.28 of this Code shall be collected at the time of examination; (2) assessments calculated annually for each corporation or association which take into consideration annual premium receipts, and/or admitted assets that are not attributable to 90 percent of pension plan contracts as defined in Section 818(a) of the Internal Revenue Code of 1986 (26 U.S.C. Section 818(a)), and/or insurance in force shall be assessed annually for each such corporation or association. In computing the assessments, the board may not consider insurance premiums for insurance contracted for by a state or federal governmental entity to provide welfare benefits to designated welfare recipients or contracted for in accordance with or in furtherance of Title 2, Human Resources Code, or the federal Social Security Act (42 U.S.C. Section 301 et seq.). The amount of all examination and evaluation fees [the assessments] paid in each taxable year to [or for the use of] the State of Texas by an [any] insurance carrier [corporation or association hereby affected] shall be allowed as a credit on the amount of premium taxes due under this article [to be paid by any such insurance corporation or association for such taxable year except as provided by Article 1.28 of this Code]. The limitations provided by Sections 803.007(1) and (2)(B) of this code for domestic insurance companies apply to foreign insurance companies. SECTION 3. Section 1, Article 4.10, Insurance Code, is amended to read as follows: Sec. 1. PAYMENT OF TAX. Every insurance carrier, including Lloyd's and reciprocal or interinsurance exchanges and any other organization or concern receiving gross premiums from the business of fire, marine, marine inland, accident, credit, livestock, fidelity, guaranty, surety, casualty, workers' compensation, employers' liability, or any other kind or character of insurance, except title insurance and except as provided in Sections 2, 3, and 4 of this article, shall pay to the comptroller a tax upon such gross premium receipts as provided in this article. Any such insurance carrier doing other kinds of insurance business shall pay the tax levied upon its gross premiums received from such other kinds of business as provided in Articles 4.03 and 4.11 of this code. SECTION 4. Section 13, Article 4.10, Insurance Code, is amended to read as follows: Sec. 13. EXAMINATION AND EVALUATION FEE CREDITS. The amount of all examination and evaluation fees paid in each taxable year to [or for the use of] the State of Texas by an insurance carrier shall be allowed as a credit on the amount of premium taxes due under this article [except as provided by Article 1.28 of this code]. The limitations provided by Sections 803.007(1) and (2)(B) of this code for domestic insurance companies apply to foreign insurance companies. Any credit allowed by the provisions of this section is in addition to any other credits allowable by statute. SECTION 5. Section 8, Article 4.11, Insurance Code, is amended to read as follows: Sec. 8. EXAMINATION AND EVALUATION [VALUATION] FEES ALLOWED AS CREDITS. The amount of all examination and evaluation [valuation] fees paid in [during] each taxable [tax] year to [or for the use of] the State of Texas by an insurance carrier shall be allowed as a credit on the amount of premium taxes due under this article [except as provided by Article 1.28 of this code]. The limitations provided by Sections 803.007(1) and (2)(B) of this code for domestic insurance companies apply to foreign insurance companies. Any credit allowed by the provisions of this section is in addition to any other credits allowable by statute. SECTION 6. Article 4.17(a), Insurance Code, is amended to read as follows: (a) The commissioner shall annually determine the rate of assessment of a maintenance tax to be paid on an annual, semiannual, or other periodic basis, as determined by the comptroller. The rate of assessment may not exceed .04 percent of the correctly reported gross premiums of life, health, and accident insurance coverages and the gross considerations for annuity and endowment contracts collected by all authorized insurers writing life, health, and accident insurance, annuity, or endowment contracts in this state. The comptroller shall collect the maintenance tax. For purposes of this article, the gross premiums on which an assessment is based may not include: (1) premiums received from this state or the United States for insurance contracted for by this state or the United States for the purpose of providing welfare benefits to designated welfare recipients or for insurance contracted for by this state or the United States in accordance with or in furtherance of Title 2, Human Resources Code, or the federal Social Security Act (42 U.S.C. Section 301 et seq.); or (2) premiums paid on group health, accident, and life policies in which the group covered by the policy consists of a single nonprofit trust established to provide coverage primarily for employees of: (A) a municipality, county, or hospital district in this state; or (B) a county or municipal hospital, without regard to whether the employees are employees of the county or municipality or of an entity operating the hospital on behalf of the county or municipality. SECTION 7. Section 7, Article 9.59, Insurance Code, is amended to read as follows: Sec. 7. EXAMINATION AND EVALUATION FEE CREDITS. The amount of all examination and evaluation fees paid in each taxable year to [or for the use of] the State of Texas by a title insurance company shall be allowed as a credit on the amount of premium taxes due under this article [except as provided by Article 1.28 of this code]. The limitations provided by Sections 803.007(1) and (2)(B) of this code for domestic insurance companies apply to foreign insurance companies. Any credit allowed by this section is in addition to any other credits allowed by law. SECTION 8. Section 33(d), Texas Health Maintenance Organization Act (Article 20A.33, Vernon's Texas Insurance Code), is amended to read as follows: (d) The commissioner shall annually determine the rate of assessment of a per capita maintenance tax to be paid on an annual or semiannual basis, on the correctly reported gross revenues for the issuance of health maintenance certificates or contracts collected by all authorized health maintenance organizations issuing such coverages in this state. The rate of assessment may not exceed $2 for each enrollee. The rate of assessment may differ between basic health care plans, limited health care service plans, and single health care service plans and shall equitably reflect any differences in regulatory resources attributable to each type of plan. The comptroller shall collect the maintenance tax. For purposes of this section, the amount of maintenance tax assessed may not be computed on: (1) enrollees who as individual certificate holders or their dependents are covered by a master group policy paid for by revenues received from this state or the United States for insurance contracted for by this state or the United States for the purpose of providing welfare benefits to designated welfare recipients or for insurance contracted for by this state or the United States in accordance with or in furtherance of Title 2, Human Resources Code, or the federal Social Security Act (42 U.S.C. Section 301 et seq.); or (2) revenues paid on group health, accident, and life certificates or contracts in which the group covered by the certificate or contract consists of a single nonprofit trust established to provide coverage primarily for employees of: (A) a municipality, county, or hospital district in this state; or (B) a county or municipal hospital, without regard to whether the employees are employees of the county or municipality or of an entity operating the hospital on behalf of the county or municipality. SECTION 9. Section 101.053(b), Insurance Code, as effective June 1, 2003, is amended to read as follows: (b) Sections 101.051 and 101.052 do not apply to: (1) the lawful transaction of surplus lines insurance under Chapter 981; (2) the lawful transaction of reinsurance by insurers; (3) a transaction in this state that: (A) involves a policy that: (i) is lawfully solicited, written, and delivered outside this state; and (ii) covers, at the time the policy is issued, only subjects of insurance that are not resident, located, or expressly to be performed in this state; and (B) takes place after the policy is issued; (4) a transaction: (A) that involves an insurance contract independently procured by the insured from an insurance company not authorized to do insurance business in this state through negotiations occurring entirely outside this state; (B) that is reported; and (C) on which premium tax is paid in accordance with this chapter; (5) a transaction in this state that: (A) involves group life, health, or accident insurance, other than credit insurance, and group annuities in which the master policy for the group was lawfully issued and delivered in a state in which the insurer or person was authorized to do insurance business; and (B) is authorized by a statute of this state; (6) an activity in this state by or on the sole behalf of a nonadmitted captive insurance company that insures solely: (A) directors' and officers' liability insurance for the directors and officers of the company's parent and affiliated companies; (B) the risks of the company's parent and affiliated companies; or (C) both the individuals and entities described by Paragraphs (A) and (B); (7) the issuance of a qualified charitable gift annuity under Chapter 102; or (8) a lawful transaction by a servicing company of the Texas workers' compensation employers' rejected risk fund under Section 4.08, Article 5.76-2, as that article existed before its repeal. SECTION 9A. Subchapter L, Chapter 843, Insurance Code, is amended by adding Section 843.409 to read as follows: Sec. 843.409. EXAMINATION EXPENSES. (a) A credit against the amount of premium taxes to be paid by a health maintenance organization in a taxable year may not be allowed on: (1) an examination fee or expense paid to another state; or (2) an examination expense: (A) directly attributable to an examination of the books, records, accounts, or principal offices of a health maintenance organization located outside this state; or (B) paid in a different taxable year. (b) The limitations provided by Subsections (a)(1) and (a)(2)(B) apply to foreign health maintenance organizations. SECTION 10. Section 912.002(b), Insurance Code, as effective June 1, 2003, is amended to read as follows: (b) A county mutual insurance company is subject to: (1) Sections 38.001 and 822.204; and (2) Articles 1.15, 1.15A, 1.16, 1.35B, 2.10, 4.10, 5.12, 5.37, 5.38, 5.39, 5.40, 5.49, 21.21, and 21.49. SECTION 11. Section 376.470, Local Government Code, as added by Chapter 1433, Acts of the 77th Legislature, Regular Session, 2001, is amended by adding Subsection (d) to read as follows: (d) Chapter 321, Tax Code, applies to the imposition, computation, administration, enforcement, and collection of the sales and use tax imposed by this section except to the extent it is inconsistent with this chapter. SECTION 12. Section 2153.153(a), Occupations Code, is amended to read as follows: (a) A license applicant must file with the comptroller a license application that: (1) contains a complete statement about the ownership of the business that is the subject of the application, including: (A) the nature of the business entity; and (B) except as provided by Subsection (b), the name and residence address of each person who has a financial interest in the business, including the nature, type, and extent of the interest; (2) designates: (A) an individual, as described by Subsection (c), responsible for maintaining a record of and reporting to the comptroller information as required by Section 2153.202; and (B) an office located in this state where the applicant proposes to maintain the records required by this chapter, a rule adopted under this chapter, or other law; (3) is accompanied by: (A) a written statement executed by the individual designated under Subdivision (2) that the individual accepts the responsibility described by that subdivision; and (B) a cashier's check, [or] money order, personal check, or other method of payment authorized by the comptroller, in an amount equal to the annual license fee under Section 2153.154; (4) includes any other relevant information required by the comptroller; and (5) states that the information contained in the application is true and correct. SECTION 13. Section 111.0046, Tax Code, is amended to read as follows: Sec. 111.0046. [REFUSAL TO] PERMIT OR LICENSE. (a) The comptroller shall refuse to issue or renew any permit or license to a person who: (1) is not permitted or licensed as required by law for a different tax or activity administered by the comptroller, except if the issuance or renewal of such license or permit is pending before the comptroller; or (2) is currently delinquent in the payment of any tax collected by the comptroller. (b) The comptroller by rule may establish a minimum age for a person to be eligible to apply for a permit or license issued by the comptroller. SECTION 14. Sections 111.012(a) and (g), Tax Code, are amended to read as follows: (a) If the comptroller finds that a tax imposed by this title is insecure, the comptroller may require a taxpayer [who is delinquent in the payment of the tax] to: (1) provide security for the payment of taxes; or (2) establish a tax escrow account at a bank or other financial institution. (g) If a taxpayer does not furnish security to the comptroller or establish a tax escrow account as required by the comptroller before the expiration of 10 days following the day on which notice is received, the comptroller may: (1) bring suit in a district court in Travis County for an order enjoining the taxpayer from engaging in business until the security is furnished or the tax escrow account is established; or (2) pursue any other remedies or collection actions available to the comptroller under this chapter or Chapter 113 to ensure the security is furnished or the tax escrow account is established. [Venue for a suit under this section is in Travis County.] SECTION 15. Section 113.006(b), Tax Code, is amended to read as follows: (b) One tax lien notice is sufficient to cover all taxes of any [the same] nature administered by the comptroller, including penalty and interest computed by reference to the amount of tax, that may have accrued before or after the filing of the notice. SECTION 16. Section 151.0035, Tax Code, is amended to read as follows: Sec. 151.0035. "DATA PROCESSING SERVICE." "Data processing service" includes word processing, data entry, data retrieval, data search, information compilation, payroll and business accounting data production, the performance of a totalisator service with the use of computational equipment [equiptment] required by the Texas Racing Act (Article 179e, Vernon's Texas Civil Statutes), and other computerized data and information storage or manipulation. "Data processing service" also includes the use of a computer or computer time for data processing whether the processing is performed by the provider of the computer or computer time or by the purchaser or other beneficiary of the service. "Data processing service" does not include the transcription of medical dictation by a medical transcriptionist. "Data storage," as used in this section, does not include a classified advertisement, banner advertisement, vertical advertisement, or link when the item is displayed on an Internet website owned by another person. SECTION 17. Section 151.005, Tax Code, is amended to read as follows: Sec. 151.005. "SALE" OR "PURCHASE." "Sale" or "purchase" means any of the following when done or performed for consideration: (1) a transfer of title or possession of tangible personal property; (2) the exchange, barter, lease, or rental of tangible personal property; (3) the performance of a taxable service, the charge for an extended warranty or service contract for the performance of a taxable service, or, in the case of an amusement service, a transfer of title to or possession of a ticket or other admission document, the collection of an admission fee, whether by individual performance, subscription series, or membership privilege, the collection of dues or a fee, charge, or assessment, including an initiation fee, by a club or organization for membership or a special privilege, status, or membership classification in the club or organization, or the use of a coin-operated machine; (4) the production, fabrication, processing, printing, or imprinting of tangible personal property for consumers who directly or indirectly furnish the materials used in the production, fabrication, processing, printing, or imprinting; (5) the furnishing and distribution of tangible personal property by a social club or fraternal organization to anyone; (6) the furnishing, preparation, or service of food, meals, or drinks; (7) a transfer of the possession of tangible personal property if the title to the property is retained by the seller as security for the payment of the price; or (8) a transfer of the title or possession of tangible personal property that has been produced, fabricated, or printed to the special order of the customer. SECTION 18. Section 151.056, Tax Code, is amended by adding Subsection (f) to read as follows: (f) A contractor is not eligible for the exemption provided by Section 151.318 on items used in the performance of a contract to improve real property. SECTION 19. Section 151.313(a), Tax Code, is amended to read as follows: (a) The following items are exempted from the taxes imposed by this chapter: (1) a drug or medicine, other than insulin, if prescribed or dispensed for a human or animal by a licensed practitioner of the healing arts; (2) insulin; (3) subject to Subsection (c), a drug or medicine, without regard to whether it is prescribed or dispensed by a licensed practitioner of the healing arts; (4) a hypodermic syringe or needle; (5) a brace; hearing aid or audio loop; orthopedic, dental, or prosthetic device; ileostomy, colostomy, or ileal bladder appliance; or supplies or replacement parts for the listed items; (6) a therapeutic appliance, device, and any related supplies specifically designed for those products, if dispensed or prescribed by a licensed practitioner of the healing arts, when those items are purchased and used by an individual for whom the items listed in this subdivision were dispensed or prescribed; (7) corrective lens and necessary and related supplies, if dispensed or prescribed by an ophthalmologist or optometrist; (8) specialized printing or signalling equipment used by the deaf for the purpose of enabling the deaf to communicate through the use of an ordinary telephone and all materials, paper, and printing ribbons used in that equipment; (9) a braille wristwatch, braille writer, braille paper and braille electronic equipment that connects to computer equipment, and the necessary adaptive devices and adaptive computer software; (10) each of the following items if purchased for use by the blind to enable them to function more independently: a slate and stylus, print enlarger, light probe, magnifier, white cane, talking clock, large print terminal, talking terminal, or harness for guide dog; (11) hospital beds; (12) blood glucose monitoring test strips; (13) an adjustable eating utensil used to facilitate independent eating if purchased for use by a person, including a person who is elderly or physically disabled, has had a stroke, or is a burn victim, who does not have full use or control of the person's hands or arms; [and] (14) subject to Subsection (d), a dietary supplement; and (15) intravenous systems, supplies, and replacement parts used in the treatment of humans. SECTION 20. Section 151.314(e), Tax Code, is amended to read as follows: (e) Food products, candy, carbonated beverages, and diluted juices are exempted from the taxes imposed by this chapter if sold at an exempt sale qualifying under this subsection or if stored or used by the purchaser of the item at the exempt sale. A sale is exempted under this subsection if: (1) the sale is made by a [person under 19 years old who is a] member of or volunteer for a nonprofit organization devoted to the exclusive purpose of education or religious or physical training or by a group associated with a public or private elementary or secondary school; (2) the sale is made as a part of a fund-raising drive sponsored by the organization or group; and (3) all net proceeds from the sale go to the organization or group for its exclusive use. SECTION 21. Section 151.319(f), Tax Code, is amended to read as follows: (f) In this section, "newspaper" means a publication that is printed on newsprint, the average sales price of which for each copy over a 30-day period does not exceed $1.50 [75 cents], and that is printed and distributed at a daily, weekly, or other short interval for the dissemination of news of a general character and of a general interest. "Newspaper" does not include a magazine, handbill, circular, flyer, sales catalog, or similar printed item unless the printed item is printed for distribution as a part of a newspaper and is actually distributed as a part of a newspaper. For the purposes of this section, an advertisement is news of a general character and of a general interest. Notwithstanding any other provision of this subsection, "newspaper" includes: (1) a publication containing articles and essays of general interest by various writers and advertisements that is produced for the operator of a licensed and certified carrier of persons and distributed by the operator to its customers during their travel on the carrier; and (2) a publication for the dissemination of news of a general character and of a general interest that is printed on newsprint and distributed to the general public free of charge at a daily, weekly, or other short interval. SECTION 22. Section 151.323, Tax Code, is amended to read as follows: Sec. 151.323. CERTAIN TELECOMMUNICATIONS SERVICES. (a) There are exempted from the taxes imposed by this chapter the receipts from the sale, use, or other consumption in this state of: (1) long-distance telecommunications services that are not both originated from and billed to a telephone number or billing or service address within Texas; (2) access to a local exchange telephone company's network by a regulated provider of telecommunications services; and (3) broadcasts, other than cable television service, by commercial radio or television stations licensed or regulated by the Federal Communications Commission. (b) The exemption provided by this section does not apply to mobile telecommunications services. SECTION 23. Subchapter H, Chapter 151, Tax Code, is amended by adding Section 151.3501 to read as follows: Sec. 151.3501. LABOR TO RESTORE, REPAIR, OR REMODEL HISTORIC SITES. (a) Labor to restore, repair, or remodel an improvement to real property is exempted from the taxes imposed by this chapter if: (1) the amount of the charge for labor is separately itemized; and (2) the restoration, repair, or remodeling is performed on an improvement to real property listed in the National Register of Historic Places. (b) The exemption provided by this section does not apply to tangible personal property transferred by the service provider to the purchaser as part of the service. SECTION 24. Section 151.355, Tax Code, as amended by Chapters 966 and 1234, Acts of the 77th Legislature, Regular Session, 2001, is reenacted and amended to read as follows: Sec. 151.355. WATER-RELATED EXEMPTIONS. The following are exempted from taxes imposed by this chapter: (1) rainwater harvesting equipment or supplies, water recycling and reuse equipment or supplies, or other equipment, services, or supplies used solely to reduce or eliminate water use; (2) equipment, services, or supplies used solely for desalination of surface water or groundwater; (3) equipment, services, or supplies used solely for brush control designed to enhance the availability of water; (4) equipment, services, or supplies used solely for precipitation enhancement; (5) equipment, services, or supplies used solely to construct or operate a water or wastewater system certified by the Texas Commission on Environmental Quality [Natural Resource Conservation Commission] as a regional system; and (6) equipment, services, or supplies used solely to construct or operate a water supply or wastewater system by a private entity as a public-private partnership as certified by the political subdivision that is a party to the project. SECTION 25. Section 152.086(a), Tax Code, is amended to read as follows: (a) The taxes imposed by this chapter do not apply to the sale or use of a motor vehicle that: (1) has been or will be modified before the second anniversary of the date of purchase for operation by, or for the transportation of, an orthopedically handicapped person; and (2) is driven by or used for the transportation of an orthopedically handicapped person. SECTION 26. Subchapter F, Chapter 152, Tax Code, is amended by adding Section 152.106 to read as follows: Sec. 152.106. PROHIBITED ADVERTISING; CRIMINAL PENALTY. (a) A person who is required by Chapter 503, Transportation Code, to hold a dealer's general distinguishing number commits an offense if the person directly or indirectly advertises, holds out, or states to a customer or to the public that the person: (1) will assume, absorb, or refund a part of the tax imposed by this chapter; or (2) will not add the tax imposed by this chapter to the sales price of the motor vehicle sold, leased, or rented. (b) An offense under this section is a Class C misdemeanor. SECTION 27. Section 155.002, Tax Code, is amended to read as follows: Sec. 155.002. STORAGE. (a) The commercial business location where tobacco products are stored or kept cannot be a residence or a unit in a public storage facility. (b) This section does not apply to a manufacturer's representative. SECTION 28. Section 156.051(a), Tax Code, is amended to read as follows: (a) A tax is imposed on a person who, under a lease, concession, permit, right of access, license, contract, or agreement, pays for the use or possession or for the right to the use or possession of a room or space in a hotel costing $15 [$2] or more each day. SECTION 29. Section 156.102(b), Tax Code, is amended to read as follows: (b) For purposes of this section: (1) a corporation or association that is organized and operated exclusively for the cleaning of beaches and that has no part of its net earnings inure to the benefit of a private shareholder or individual is organized and operated exclusively for a charitable purpose; and (2) a public or private institution of higher education is organized and operated exclusively for an educational purpose only if the institution is defined as a Texas [an] institution of higher education or as a Texas private or independent institution of higher education under any subdivision of Section 61.003, Education Code. SECTION 30. Subchapter C, Chapter 156, Tax Code, is amended by adding Section 156.104 to read as follows: Sec. 156.104. EXEMPTION CERTIFICATE. (a) The right to use or possess a room or space in a hotel is exempt from taxation under this chapter if the person required to collect the tax receives, in good faith from a guest, a properly completed exemption certificate stating that the guest is qualified for an exemption under Section 156.102 or 156.103. An exemption certificate must be supported by the documentation required under rules adopted by the comptroller. (b) The comptroller shall produce and maintain a list of entities that have been provided a letter of exemption from the state hotel occupancy tax under Section 156.102. The comptroller shall make the list available on the comptroller's Internet website. SECTION 31. Section 171.001(a), Tax Code, is amended to read as follows: (a) A franchise tax is imposed on: (1) each corporation that does business in this state or that is chartered [or authorized to do business] in this state; [,] and (2) each limited liability company that does business in this state or that is organized under the laws of this state [or is authorized to do business in this state]. SECTION 32. Section 171.001(b)(2), Tax Code, is amended to read as follows: (2) "Beginning date" means: (A) for a corporation chartered in this state, the date on which the corporation's charter takes effect; and (B) for a foreign corporation, [the earlier of] the date on which[: [(i) the corporation's certificate of authority takes effect; or [(ii)] the corporation begins doing business in this state. SECTION 33. Section 171.052, Tax Code, is amended to read as follows: Sec. 171.052. CERTAIN CORPORATIONS. An insurance organization, title insurance company, or title insurance agent authorized to engage in insurance business in this state now required to pay an annual tax under Chapter 4 or 9, Insurance Code, measured by its gross premium receipts is exempted from the franchise tax. A [An insurance organization performing management or accounting activities in this state on behalf of a] nonadmitted [captive] insurance organization [company under Chapter 101, Insurance Code,] that is required to pay a gross premium receipts tax during a tax year is exempted from the franchise tax for that same tax year. Farm mutuals, local mutual aid associations, and burial associations are not subject to the franchise tax. SECTION 34. Section 171.084(c), Tax Code, is amended to read as follows: (c) In this section, "wholesale center" means a permanent wholesale facility that has permanent tenants and that promotes at least four national or regional trade shows in a calendar year. A tenant leasing space at a wholesale center for a period longer than the period prescribed by Subsection (b) may qualify for the exemption provided by this section only if the tenant solicits orders on an occasional basis at the trade show as prescribed by Subsection (b). SECTION 35. Section 171.1032(b), Tax Code, is amended to read as follows: (b) A corporation shall deduct from its gross receipts computed under Subsection (a) any amount to the extent included under Subsection (a) because of the application of Section 78 or Sections 951-964, Internal Revenue Code, any amount excludable under Section 171.110(k), and dividends received from a subsidiary, associate, or affiliated corporation that does not transact a substantial portion of its business or regularly maintain a substantial portion of its assets in the United States. SECTION 36. Section 171.1051(c), Tax Code, is amended to read as follows: (c) A corporation shall deduct from its gross receipts computed under Subsection (a) any amount to the extent included in Subsection (a) because of the application of Section 78 or Sections 951-964, Internal Revenue Code, any amount excludable under Section 171.110(k), and dividends received from a subsidiary, associate, or affiliated corporation that does not transact a substantial portion of its business or regularly maintain a substantial portion of its assets in the United States. SECTION 37. Section 171.106, Tax Code, is amended by adding Subsection (i) to read as follows: (i) Receipts from services that a defense readjustment project performs in a defense economic readjustment zone are not receipts from business done in this state. SECTION 38. Section 171.109, Tax Code, is amended by adding Subsection (a-1) to read as follows: (a-1) A legally enforceable obligation that requires the return of a like-kind property that was borrowed will be considered debt if it is a liability according to generally accepted accounting principles and if the return must be made within an ascertainable period of time or on demand. The amount that will be considered debt is the fair market value measured on the last day on which the report is based as required by Section 171.153. For purposes of this subsection, "like-kind property" means the same quantity, quality, and nature or character as the property borrowed. SECTION 39. Section 171.110, Tax Code, is amended by amending Subsection (a) and adding Subsections (k) and (l) to read as follows: (a) The net taxable earned surplus of a corporation is computed by: (1) determining the corporation's reportable federal taxable income, subtracting from that amount any amount excludable under Subsection (k), any amount included in reportable federal taxable income under Section 78 or Sections 951-964, Internal Revenue Code, and dividends received from a subsidiary, associate, or affiliated corporation that does not transact a substantial portion of its business or regularly maintain a substantial portion of its assets in the United States, and adding to that amount any compensation of officers or directors, or if a bank, any compensation of directors and executive officers, to the extent excluded in determining federal taxable income to determine the corporation's taxable earned surplus; (2) apportioning the corporation's taxable earned surplus to this state as provided by Section 171.106(b) or (c), as applicable, to determine the corporation's apportioned taxable earned surplus; (3) adding the corporation's taxable earned surplus allocated to this state as provided by Section 171.1061; and (4) subtracting from that amount any allowable deductions and any business loss that is carried forward to the tax reporting period and deductible under Subsection (e). (k) Dividends and interest received from federal obligations are not included in earned surplus or gross receipts for earned surplus purposes. (l) In this section: (1) "Federal obligations" means: (A) stocks and other direct obligations of, and obligations unconditionally guaranteed by, the United States government and United States government agencies; and (B) direct obligations of a United States government-sponsored agency. (2) "Obligation" means any bond, debenture, security, mortgage-backed security, pass-through certificate, or other evidence of indebtedness of the issuing entity. The term does not include a deposit, a repurchase agreement, a loan, a lease, a participation in a loan or pool of loans, a loan collateralized by an obligation of a United States government agency, or a loan guaranteed by a United States government agency. (3) "United States government" means any department or ministry of the federal government, including a federal reserve bank. The term does not include a state or local government, a commercial enterprise owned wholly or partly by the United States government, or a local governmental entity or commercial enterprise whose obligations are guaranteed by the United States government. (4) "United States government agency" means an instrumentality of the United States government whose obligations are fully and explicitly guaranteed as to the timely payment of principal and interest by the full faith and credit of the United States government. The term includes the Government National Mortgage Association, the Department of Veterans Affairs, the Federal Housing Administration, the Farmers Home Administration, the Export-Import Bank, the Overseas Private Investment Corporation, the Commodity Credit Corporation, the Small Business Administration, and any successor agency. (5) "United States government-sponsored agency" means an agency originally established or chartered by the United States government to serve public purposes specified by the United States Congress but whose obligations are not explicitly guaranteed by the full faith and credit of the United States government. The term includes the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, the Farm Credit System, the Federal Home Loan Bank System, the Student Loan Marketing Association, and any successor agency. SECTION 40. Sections 171.110(b) and (c), Tax Code, are amended to read as follows: (b) Except as provided by Subsection (c), a [A] corporation is not required to add the compensation of officers or directors as required by Subsection (a)(1) if the corporation is: (1) a corporation that has not more than 35 shareholders; or (2) an S corporation, as that term is defined by Section 1361, Internal Revenue Code. (c) A subsidiary corporation may not claim the exclusion under Subsection (b) if it has a parent corporation that does not qualify for the exclusion. For purposes of this subsection, a corporation qualifies as a parent if it ultimately controls the subsidiary, even if the control arises through a series or group of other subsidiaries or entities. Control is presumed if a parent corporation directly or indirectly owns, controls, or holds a majority of the outstanding voting stock of a corporation or ownership interests in another entity [Subsection (b) does not apply to a subsidiary corporation unless it applies to the subsidiary's parent corporation]. SECTION 41. Section 171.203, Tax Code, is amended by adding Subsection (f) to read as follows: (f) A public information report that is filed electronically complies with the signature and certification requirements prescribed by Subsection (d). SECTION 42. Subchapter O, Chapter 171, Tax Code, is amended by adding Section 171.731 to read as follows: Sec. 171.731. ASSIGNMENT PROHIBITED. A corporation may not convey, assign, or transfer the credit allowed under this subchapter to another entity unless all of the assets of the corporation are conveyed, assigned, or transferred in the same transaction. SECTION 43. Section 171.751(1), Tax Code, is amended to read as follows: (1) "Agricultural processing" means an establishment primarily engaged in activities described in categories 0724, 2011-2099, 2211, 2231, 2824, 2833, 2834, 2835, 2836, 2841, 3111-3199, 3262, or 3952, in product classes 28692 or 28698 of category 2869, or in product classes 28992 or 28994 of category 2899 of the 1987 Standard Industrial Classification Manual published by the federal Office of Management and Budget. SECTION 44. Subchapter P, Chapter 171, Tax Code, is amended by adding Section 171.7515 to read as follows: Sec. 171.7515. "QUALIFIED BUSINESS." (a) In addition to the meaning assigned by Section 171.751(8), "qualified business" also means a corporation that has been designated as an enterprise project or as a defense readjustment project and is certified by the Texas Department of Economic Development as a qualified business under Section 2303.402 or 2310.302, Government Code. (b) This section expires January 1, 2005. SECTION 45. Section 171.753, Tax Code, is amended to read as follows: Sec. 171.753. CALCULATION OF CREDIT. A corporation may establish a credit equal to five percent of the total wages and salaries paid by the corporation for qualifying jobs during the period upon which the tax is based, on each of five consecutive reports beginning with the report based on the period during which the qualifying jobs were created. SECTION 46. Subchapter P, Chapter 171, Tax Code, is amended by adding Section 171.7541 to read as follows: Sec. 171.7541. LENGTH OF CREDIT. Notwithstanding Section 171.753, a corporation that has been designated as an enterprise project or as a defense readjustment project on or after September 1, 2001, may, beginning on the date the project is designated, establish a credit equal to 25 percent of the total wages and salaries paid by the corporation for qualifying jobs. Subject to Section 171.755, the corporation may claim the entire credit earned on a report originally due on or after September 1, 2003, and before January 1, 2005. This section expires January 1, 2005. SECTION 47. Section 171.802, Tax Code, is amended by adding Subsections (d) and (e) to read as follows: (d) A corporation that has been designated as an enterprise project or as a defense readjustment project and is certified by the Texas Department of Economic Development as a qualified business under Section 2303.402 or 2310.302, Government Code, may qualify for the credit provided by this subchapter, regardless of whether the corporation meets the qualifications prescribed by Subsection (b). This subsection expires January 1, 2005. (e) A corporation may claim a credit or take a carryfoward credit for a qualified capital investment made on or after January 1, 2003, without regard to whether the county in which it makes the qualified capital investment has lost its designation as a strategic investment area if: (1) the corporation committed to the investment in that county before January 2003; (2) at the time the corporation made the commitment, the county was designated as a strategic investment area; (3) the total investment is at least $100 million; (4) the county has a population of less than 15,700; and (5) the corporation made a qualified capital investment in the county in each of the two years preceding the year in which the corporation made the qualified capital investment under this subsection. SECTION 48. Section 171.803, Tax Code, is amended to read as follows: Sec. 171.803. CALCULATION OF CREDIT. (a) Except as provided by Subsection (b), a [A] corporation may establish a credit equal to 7.5 percent of the qualified capital investment during the period upon which the tax is based. (b) A corporation that has been designated as an enterprise project or as a defense readjustment project on or after September 1, 2001, may, beginning on the date the project is designated, establish a credit equal to 7.5 percent of the qualified capital investment. This subsection expires January 1, 2005. SECTION 49. Section 171.804(b), Tax Code, as effective September 1, 2003, is amended to read as follows: (b) Subject to Section 171.805, a corporation that has been designated as an enterprise project or as a defense readjustment project may claim the entire credit earned on a report originally due on or after September 1, 2003, and before January 1, 2006 [during an accounting period against the taxes imposed for the corresponding reporting period]. SECTION 50. Section 171.853(c), Tax Code, is amended to read as follows: (c) The credit claimed for each privilege period may not exceed 50 percent of the amount of [net] franchise tax due, before [after] any other applicable tax credits, for the privilege period. SECTION 51. Chapter 171, Tax Code, is amended by adding Subchapter U to read as follows:
SUBCHAPTER U. TAX CREDIT FOR TITLE INSURANCE HOLDING
COMPANIES
Sec. 171.891. APPLICABILITY OF DEFINITIONS. In this subchapter: (1) "Control" has the meaning described by Sections 823.005 and 823.151, Insurance Code. (2) "Controlled insurer," "domestic insurer," and "holding company" have the meanings assigned by Section 823.002, Insurance Code. (3) "Title insurance," "title insurance agent," and "title insurance company" have the meanings assigned by Article 9.02, Insurance Code. Sec. 171.892. ELIGIBILITY. A corporation is entitled to a credit as provided by this subchapter against the tax imposed under this chapter if the corporation: (1) is a title insurance holding company subject to Chapter 823, Insurance Code; and (2) controls one or more domestic title insurance companies that are subject to the tax on premiums imposed under Article 9.59, Insurance Code. Sec. 171.893. AMOUNT; LIMITATIONS. (a) The amount of the credit for each controlled domestic title insurance company is computed by multiplying the amount of tax on premiums paid by that company in the most recent calendar year ending before the franchise tax report is due by the percentage of ownership of the title insurance holding company in the controlled domestic title insurance company. The percentage of ownership of a controlled domestic title insurance company is determined as of the accounting year-end on which the report is based. (b) A claim for a credit is subject to the following limitations: (1) if the total amount of the credit for all controlled title insurance companies exceeds the franchise tax due, the credit is an amount equal to the franchise tax due; (2) no portion of a credit may be applied to another year's franchise tax report; and (3) a corporation may not take credit for the same tax on premiums more than once. Sec. 171.894. EFFECT ON OTHER TAXES. This subchapter does not exempt a title insurance holding company, a title insurance company, or a title insurance agent from paying a tax imposed by this code, except that a title insurance company or a title insurance agent whose principal activity is the business of title insurance is exempt from a tax imposed by this chapter. SECTION 52. Section 201.057(c), Tax Code, is amended to read as follows: (c) High-cost gas as defined in Subsection (a)(2)(A) produced from a well that is spudded or completed after August 31, 1996, [and before September 1, 2010,] is entitled to a reduction of the tax imposed by this chapter for the first 120 consecutive calendar months beginning on the first day of production, or until the cumulative value of the tax reduction equals 50 percent of the drilling and completion costs incurred for the well, whichever occurs first. The amount of tax reduction shall be computed by subtracting from the tax rate imposed by Section 201.052 the product of that tax rate times the ratio of drilling and completion costs incurred for the well to twice the median drilling and completion costs for high-cost wells as defined in Subsection (a)(2)(A) spudded or completed during the previous state fiscal year, except that the effective rate of tax may not be reduced below zero. SECTION 53. Section 202.054(c), Tax Code, is amended to read as follows: (c) This section applies to an enhanced recovery project that begins active operation on or after September 1, 1989, and to an expansion that the commission approves on or after September 1, 1991. An application for approval under this section must be filed on or after September 1, 1989, [and before January 1, 2008,] for a new enhanced recovery project. An application for approval under this section must be filed on or after September 1, 1991, [and before January 1, 2008,] for an expansion of an existing enhanced recovery project. A project may not qualify as an expansion if the project has qualified as a new enhanced recovery project under this section. An application may be filed on or after September 1, 1989, even if a separate application for approval of the project or expansion has already been filed under Subchapter B, Chapter 101, Natural Resources Code, or for approval as a tertiary recovery project for purposes of Section 4993, Internal Revenue Code of 1986, if the operation of a new project or the expansion of an existing project, other than a co-production project, does not begin before the application for approval under this section is approved by the commission; provided, however, nothing herein shall require commission approval of a co-production project prior to commencing active operations on such project in order for such project to be eligible for the recovered oil tax rate. SECTION 54. Subchapter B, Chapter 321, Tax Code, is amended by adding Section 321.107 to read as follows: Sec. 321.107. ADMINISTRATION OF LOCAL SALES AND USE TAXES IMPOSED BY OTHER GOVERNMENTAL ENTITIES. The imposition, computation, administration, enforcement, and collection of any local sales and use tax imposed by any other local governmental entity is governed by this chapter, except as otherwise provided by law. In this section, "other local governmental entity" includes any governmental entity created by the legislature that has a limited purpose or function, that has a defined or restricted geographic territory, and that is authorized by law to impose a local sales and use tax. The term does not include a county, county health services district, county landfill and criminal detention center district, metropolitan transportation authority, economic development district, crime control district, hospital district, emergency services district, or library district. SECTION 55. Section 321.203(j), Tax Code, is amended to read as follows: (j) The sale of [cable television] services delivered through a cable system is consummated at the point of delivery to the consumer. SECTION 56. Section 322.001(a), Tax Code, is amended to read as follows: (a) This chapter applies to the imposition, assessment, collection, administration, and enforcement of a sales and use tax imposed under Chapter 451, 452, [or] 453, or 460, Transportation Code. SECTION 57. Section 322.002(1), Tax Code, is amended to read as follows: (1) "Taxing entity" means a rapid transit authority, a regional transit authority, including a subregional transportation authority, or a municipal mass transit department created under Chapter 451, 452, or 453, Transportation Code, or a coordinated county transportation authority created under Chapter 460, Transportation Code, that has adopted a sales and use tax under the law authorizing the creation of the entity. SECTION 58. Section 323.203(j), Tax Code, is amended to read as follows: (j) The sale of [cable television] services delivered through a cable system is consummated at the point of delivery to the consumer. SECTION 59. The following are repealed: (1) Section 171.754, Tax Code; (2) Section 2.08, Chapter 1134, Acts of the 77th Legislature, Regular Session, 2001; and (3) Section 16, Article 9.59, Insurance Code. SECTION 60. Each change in law made to the following provisions by this Act is a clarification of existing law and does not imply that existing law may be construed as inconsistent with the law as amended by this Act: (1) Section 1, Article 4.10, Insurance Code; (2) Article 4.17(a), Insurance Code; (3) Section 33(d), Texas Health Maintenance Organization Act (Article 20A.33, Vernon's Texas Insurance Code); (4) Section 101.053(b), Insurance Code; (5) Section 912.002(b), Insurance Code; (6) Section 376.470(d), Local Government Code, as added by Chapter 1433, Acts of the 77th Legislature, Regular Session, 2001; (7) Section 2153.153(a), Occupations Code; (8) Section 151.0035, Tax Code; (9) Section 151.005, Tax Code; (10) Section 151.056(f), Tax Code; (11) Section 151.313(a), Tax Code; (12) Section 151.3501, Tax Code; (13) Section 151.355, Tax Code; (14) Section 171.052, Tax Code; (15) Section 171.084(c), Tax Code; (16) Section 171.1032(b), Tax Code; (17) Section 171.1051(c), Tax Code; (18) Section 171.106(i), Tax Code; (19) Sections 171.110(a), (b), (c), (k), and (l), Tax Code; (20) Section 171.731, Tax Code; (21) Section 171.751(1), Tax Code; (22) Subchapter U, Chapter 171, Tax Code; (23) Section 321.107, Tax Code; (24) Section 322.001(a), Tax Code; (25) Section 322.002(1), Tax Code; and (26) Section 151.319(c), Tax Code. SECTION 61. To the extent of any conflict, SECTIONS 1-60 of this Act prevail over another Act of the 78th Legislature, Regular Session, 2003, relating to nonsubstantive codifications of law or nonsubstantive additions to and corrections in enacted codes. SECTION 62. (a) Subtitle C, Title 4, Local Government Code, is amended by adding Chapter 133 to read as follows:
CHAPTER 133. CRIMINAL AND CIVIL FEES PAYABLE TO THE COMPTROLLER
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 133.001. PURPOSE. The purpose of this chapter is to consolidate and standardize: (1) collection of fees in criminal and civil matters by: (A) an officer of a court for deposit in a county or municipal treasury; or (B) an officer of a county or municipality for deposit in the county or municipal treasury, as appropriate; (2) remittance of those fees to the comptroller as required by this chapter and other law; and (3) distribution of those fees by the comptroller to the proper accounts and funds in the state treasury. Sec. 133.002. DEFINITIONS. In this chapter: (1) "Fee" means: (A) a criminal fee listed under Section 133.003; and (B) a civil fee listed under Section 133.004. (2) "Indigent" means an individual who earns not more than 125 percent of the income standard established by applicable federal poverty guidelines. (3) "Treasurer" means the custodian of money in a municipal or county treasury, as appropriate. Sec. 133.003. CRIMINAL FEES. This chapter applies to the following criminal fees: (1) the consolidated fee imposed under Section 133.102; (2) the time payment fee imposed under Section 133.103; (3) fees for services of peace officers employed by the state imposed under Article 102.011, Code of Criminal Procedure, and forwarded to the comptroller as provided by Section 133.104; (4) costs on conviction imposed in certain statutory county courts under Section 51.702, Government Code, and deposited in the judicial fund; (5) costs on conviction imposed in certain county courts under Section 51.703, Government Code, and deposited in the judicial fund; (6) the administrative fee for failure to appear or failure to pay or satisfy a judgment imposed under Section 706.006, Transportation Code; and (7) fines on conviction imposed under Section 621.506(g), Transportation Code. Sec. 133.004. CIVIL FEES. This chapter applies to the following civil fees: (1) the consolidated fee on filing in district court imposed under Section 133.151; (2) the filing fee in district court for basic civil legal services for indigents imposed under Section 133.152; (3) the filing fee in courts other than district court for basic civil legal services for indigents imposed under Section 133.153; (4) the filing fees for the judicial fund imposed in certain statutory county courts under Section 51.702, Government Code; (5) the filing fees for the judicial fund imposed in certain county courts under Section 51.703, Government Code; (6) the filing fees for the judicial fund imposed in certain statutory probate courts under Section 51.704, Government Code; (7) fees collected under Section 118.015; (8) marriage license fees for the family trust fund collected under Section 118.018; and (9) marriage license or declaration of informal marriage fees for the child abuse and neglect prevention trust fund account collected under Section 118.022.
[Sections 133.005-133.050 reserved for expansion]
SUBCHAPTER B. REPORTING, COLLECTION, AND REMITTANCE OF FEES
Sec. 133.051. COLLECTION AND REMITTANCE OF FEES. A municipality or county shall collect, record, account for, and remit to the comptroller all fees in the manner provided by this subchapter. Sec. 133.052. DEPOSIT OF FEES. (a) An officer collecting a fee in a case in municipal court shall deposit the money in the municipal treasury. (b) An officer collecting a fee in a justice, county, or district court shall deposit the money in the county treasury. (c) A municipal or county clerk collecting a fee shall deposit the money in the municipal or county treasury, as appropriate. Sec. 133.053. INTEREST-BEARING ACCOUNT. (a) The treasurer may deposit fees in an interest-bearing account. (b) The municipality or county may retain any interest accrued on the money the treasurer deposited in the treasury if the treasurer remits the funds to the comptroller within the period prescribed by Section 133.055(a). Sec. 133.054. RECORDS. (a) An officer or clerk collecting a fee shall keep a record of the money collected. (b) The treasurer shall keep a record of the money collected and on deposit in the treasury. Sec. 133.055. QUARTERLY REMITTANCE OF FEES TO THE COMPTROLLER. (a) On or before the last day of the month following each calendar quarter, the treasurer shall: (1) remit to the comptroller the money from all fees collected during the preceding quarter, except as provided by Section 133.058; and (2) submit to the comptroller the report required under Section 133.056 for criminal fees and Section 133.057 for civil fees. (b) If the treasurer does not collect any fees during a calendar quarter, the treasurer shall file the report required for the quarter in the regular manner. The report must state that no fees were collected. This subsection does not apply to fees collected under Sections 14 and 19, Article 42.12, Code of Criminal Procedure, or under Section 76.013, Government Code. Sec. 133.056. QUARTERLY REPORT FOR CRIMINAL FEES. (a) On the last day of the month following a calendar quarter, the treasurer shall report the criminal fees collected for the preceding calendar quarter. (b) For fees collected for convictions of offenses committed on or after January 1, 2004, a municipality or county shall report the fees collected for a calendar quarter categorized according to the class of offense. (c) For fees collected for convictions of offenses committed before January 1, 2004, a municipality or county shall report the total of fees collected for a calendar quarter. Sec. 133.057. QUARTERLY REPORT FOR CIVIL FEES. On the last day of the month following a calendar quarter, the treasurer shall report the civil fees collected for the preceding calendar quarter. Sec. 133.058. PORTION OF FEE RETAINED. (a) Except as otherwise provided by this section, a municipality or county may retain 10 percent of the money collected from fees as a service fee for the collection if the municipality or county remits the remainder of the fees to the comptroller within the period prescribed by Section 133.055(a). (b) A municipality or county may retain an amount greater than 10 percent of the money collected from fees if retention of the greater amount is authorized by law. (c) A county may retain five percent of the money collected as a service fee on the basic civil legal service for indigents filing fee. (d) A county may not retain a service fee on the collection of a fee: (1) for the judicial fund; or (2) under Sections 14 and 19, Article 42.12, Code of Criminal Procedure. Sec. 133.059. AUDIT. (a) The comptroller may audit the records of a county or municipality relating to fees collected under this chapter. (b) Money spent from fees collected under this chapter is subject to audit by the state auditor.
[Sections 133.060-133.100 reserved for expansion]
SUBCHAPTER C. CRIMINAL FEES
Sec. 133.101. MEANING OF CONVICTION. In this subchapter, a person is considered to have been convicted in a case if: (1) a judgment, a sentence, or both a judgment and a sentence are imposed on the person; (2) the person receives community supervision, deferred adjudication, or deferred disposition; or (3) the court defers final disposition of the case or imposition of the judgment and sentence. Sec. 133.102. CONSOLIDATED FEES ON CONVICTION. (a) A person convicted of an offense shall pay as a court cost, in addition to all other costs: (1) $133 on conviction of a felony; (2) $83 on conviction of a Class A or Class B misdemeanor; or (3) $40 on conviction of a nonjailable misdemeanor offense, including a criminal violation of a municipal ordinance, other than a conviction of an offense relating to a pedestrian or the parking of a motor vehicle. (b) The court costs under Subsection (a) shall be collected and remitted to the comptroller in the manner provided by Subchapter B. (c) The money collected under this section as court costs imposed on offenses committed on or after January 1, 2004, shall be allocated according to the percentages provided in Subsection (e). (d) The money collected as court costs imposed on offenses committed before January 1, 2004, shall be distributed using historical data so that each account or fund receives the same amount of money the account or fund would have received if the court costs for the accounts and funds had been collected and reported separately. (e) The comptroller shall allocate the court costs received under this section to the following accounts and funds so that each receives to the extent practicable, utilizing historical data as applicable, the same amount of money the account or fund would have received if the court costs for the accounts and funds had been collected and reported separately, except that the account or fund may not receive less than the following percentages: (1) abused children's counseling 0.0088 percent; (2) crime stoppers assistance 0.2581 percent; (3) breath alcohol testing 0.5507 percent; (4) Bill Blackwood Law Enforcement Management Institute 2.1683 percent; (5) law enforcement officers standards and education 5.0034 percent; (6) comprehensive rehabilitation 5.3218 percent; (7) operator's and chauffeur's license 11.1426 percent; (8) criminal justice planning 12.5537 percent; (9) an account in the state treasury to be used only for the establishment and operation of the Center for the Study and Prevention of Juvenile Crime and Delinquency at Prairie View A&M University 1.2090 percent; (10) compensation to victims of crime fund37.6338 percent; (11) fugitive apprehension account 12.0904 percent; (12) judicial and court personnel training fund 4.8362 percent; (13) an account in the state treasury to be used for the establishment and operation of the Correctional Management Institute of Texas and Criminal Justice Center Account 1.2090 percent; and (14) fair defense account 6.0143 percent. (f) Of each dollar credited to the law enforcement officers standards and education account under Subsection (e)(5): (1) 33.3 cents may be used only to pay administrative expenses; and (2) the remainder may be used only to pay expenses related to continuing education for persons licensed under Chapter 1701, Occupations Code. Sec. 133.103. TIME PAYMENT FEE. (a) A person convicted of an offense shall pay, in addition to all other costs, a fee of $25 if the person: (1) has been convicted of a felony or misdemeanor; and (2) pays any part of a fine, court costs, or restitution on or after the 31st day after the date on which a judgment is entered assessing the fine, court costs, or restitution. (b) The treasurer shall send 50 percent of the fees collected under this section to the comptroller. The comptroller shall deposit the fees received to the credit of the general revenue fund. (c) The treasurer shall deposit 10 percent of the fees collected under this section in the general fund of the county or municipality for the purpose of improving the efficiency of the administration of justice in the county or municipality. The county or municipality shall prioritize the needs of the judicial officer who collected the fees when making expenditures under this subsection and use the money deposited to provide for those needs. (d) The treasurer shall deposit the remainder of the fees collected under this section in the general revenue account of the county or municipality. Sec. 133.104. FEES FOR SERVICES OF PEACE OFFICERS EMPLOYED BY THE STATE. (a) Fees imposed under Article 102.011, Code of Criminal Procedure, for services performed by peace officers employed by the state shall be forwarded to the comptroller after deducting four-fifths of the amount of each fee received for a service performed under Subsection (a)(1) or (a)(2) of that article, in a manner directed by the comptroller. (b) The comptroller shall credit fees received under Subsection (a) to the general revenue fund.
[Sections 133.105-133.150 reserved for expansion]
SUBCHAPTER D. CIVIL FEES
Sec. 133.151. CONSOLIDATED CIVIL FEE ON FILING A CIVIL SUIT IN DISTRICT COURT. (a) In addition to each fee collected under Section 51.317(b)(1), Government Code, the clerk of a district court shall collect the following fees on the filing of any civil suit: (1) $45 for family law cases and proceedings as defined by Section 25.0002, Government Code; and (2) $50 for any case other than a case described by Subdivision (1). (b) The fees under Subsection (a) shall be collected and remitted to the comptroller in the manner provided by Subchapter B. (c) The comptroller shall allocate the fees received under this section to the following accounts and funds so that each receives to the extent practicable, utilizing historical data as applicable, the same amount of money the account or fund would have received if the fees for the accounts and funds had been collected and reported separately: (1) the judicial fund to be used for court-related purposes for the support of the judiciary; and (2) the basic civil legal services account of the judicial fund for use in programs approved by the supreme court that provide basic civil legal services to an indigent. Sec. 133.152. ADDITIONAL FILING FEES FOR CERTAIN ACTIONS AND PROCEEDINGS IN DISTRICT COURT FOR BASIC CIVIL LEGAL SERVICES FOR INDIGENTS. (a) In addition to other fees authorized or required by law, the clerk of a district court shall collect the following fees on the filing of any civil action or proceeding requiring a filing fee, including an appeal, and on the filing of any counterclaim, cross-action, intervention, interpleader, or third-party action requiring a filing fee: (1) $5 in family law cases and proceedings as defined by Section 25.0002, Government Code; and (2) $10 in any case other than a case described by Subdivision (1). (b) The fees under this section shall be collected and remitted to the comptroller in the manner provided by Subchapter B. (c) The comptroller shall deposit the fees to the credit of the basic civil legal services account of the judicial fund for use in programs approved by the supreme court that provide basic civil legal services to an indigent. Sec. 133.153. ADDITIONAL FILING FEES FOR CERTAIN ACTIONS AND PROCEEDINGS IN COURTS OTHER THAN DISTRICT COURT FOR BASIC CIVIL LEGAL SERVICES FOR INDIGENTS. (a) In addition to other fees authorized or required by law, the clerk of a court other than a district court, the courts of appeals, or the supreme court shall collect the following fees on the filing of any civil action or proceeding requiring a filing fee, including an appeal, and on the filing of any counterclaim, cross-action, intervention, interpleader, or third-party action requiring a filing fee: (1) $5 for statutory and constitutional county courts; and (2) $2 for justice of the peace courts. (b) The fees shall be collected and remitted to the comptroller in the manner provided by Subchapter B. (c) The comptroller shall deposit the fees to the credit of the basic civil legal services account of the judicial fund for use in programs approved by the supreme court that provide basic civil legal services to an indigent. (b) This section takes effect January 1, 2004. SECTION 63. (a) Subsection (e), Section 14, Article 42.12, Code of Criminal Procedure, is amended to read as follows: (e) The clerk of a court that collects a fee imposed under Subsection (c)(2) shall deposit the fee to be sent to the comptroller as provided by Subchapter B, Chapter 133, Local Government Code [remit the fee to the comptroller], and the comptroller shall deposit the fee into the general revenue fund. In requiring the payment of a fee under Subsection (c)(2), the judge shall consider fines, fees, and other necessary expenses for which the defendant is obligated in establishing the amount of the fee. The judge may not: (1) establish the fee in an amount that is greater than 25 percent of the defendant's gross income while the defendant is a participant in residential aftercare; or (2) require the defendant to pay the fee at any time other than a time at which the defendant is both employed and a participant in residential aftercare. (b) This section takes effect January 1, 2004. SECTION 64. (a) Subsection (f), Section 19, Article 42.12, Code of Criminal Procedure, is amended to read as follows: (f) A community corrections and supervision department shall deposit the [remit] fees collected under Subsection (e) of this section to be sent to the comptroller as provided by Subchapter B, Chapter 133, Local Government Code. The comptroller shall deposit the fee in the [special revenue fund to the credit of the] sexual assault program fund [established] under Section 420.008, Government [44.0061, Health and Safety] Code. (b) This section takes effect January 1, 2004. SECTION 65. (a) Article 45.048, Code of Criminal Procedure, is amended to read as follows: Art. 45.048. DISCHARGED FROM JAIL. (a) A defendant placed in jail on account of failure to pay the fine and costs shall be discharged on habeas corpus by showing that the defendant: (1) is too poor to pay the fine and costs; or (2) has remained in jail a sufficient length of time to satisfy the fine and costs, at the rate of not less than $50 [$100] for each period of time served, as specified by the convicting court in the judgment in the case. (b) A convicting court may specify a period of time that is not less than eight hours or more than 24 hours as the period for which a defendant who fails to pay the fines and costs in the case must remain in jail to satisfy $50 [$100] of the fine and costs. (b) This section takes effect January 1, 2004. (c) The change in law made by this section to Article 45.048, Code of Criminal Procedure, applies only to a defendant serving a sentence for an offense committed on or after the effective date of this section. A defendant serving a sentence for an offense committed before the effective date of this section is covered by the law in effect when the offense was committed, and the former law is continued in effect for that purpose. For purposes of this subsection, an offense is committed before the effective date of this section if any element of the offense occurs before that date. SECTION 66. (a) Subsection (e), Article 45.049, Code of Criminal Procedure, is amended to read as follows: (e) A defendant is considered to have discharged not less than $50 [$100] of fines or costs for each eight hours of community service performed under this article. (b) This section takes effect January 1, 2004. (c) The change in law made by this section to Article 45.049, Code of Criminal Procedure, applies only to a defendant serving a sentence for an offense committed on or after the effective date of this section. A defendant serving a sentence for an offense committed before the effective date of this section is covered by the law in effect when the offense was committed, and the former law is continued in effect for that purpose. For purposes of this subsection, an offense is committed before the effective date of this section if any element of the offense occurs before that date. SECTION 67. (a) Article 102.004, Code of Criminal Procedure, is amended by adding Subsection (c) to read as follows: (c) In this article, "conviction" has the meaning assigned by Section 133.101, Local Government Code. (b) This section takes effect January 1, 2004. SECTION 68. (a) Article 102.011, Code of Criminal Procedure, is amended by adding Subsection (j) to read as follows: (j) In this article, "conviction" has the meaning assigned by Section 133.101, Local Government Code. (b) This section takes effect January 1, 2004. SECTION 69. (a) Subsection (e), Article 102.014, Code of Criminal Procedure, is amended to read as follows: (e) In this article, a person is considered to have been convicted in a case if the person would be considered to have been convicted under Section 133.101, Local Government Code[: [(1) a sentence is imposed; [(2) the defendant receives probation or deferred adjudication; or [(3) the court defers final disposition of the case]. (b) This section takes effect January 1, 2004. SECTION 70. (a) Subsection (d), Section 51.702, Government Code, is amended to read as follows: (d) The clerk shall deposit [send] the fees and costs collected under this section to be sent to the comptroller as provided by Subchapter B, Chapter 133, Local Government Code [at least as frequently as monthly]. The comptroller shall deposit the fees in the judicial fund. (b) This section takes effect January 1, 2004. SECTION 71. (a) Subsection (d), Section 51.703, Government Code, is amended to read as follows: (d) The clerk shall deposit [send] the fees and costs collected under this section to be sent to the comptroller as provided by Subchapter B, Chapter 133, Local Government Code [at least as frequently as monthly]. The comptroller shall deposit the fees in the judicial fund. (b) This section takes effect January 1, 2004. SECTION 72. (a) Subsection (c), Section 51.704, Government Code, is amended to read as follows: (c) The clerk shall deposit [send] the fees collected under this section to be sent to the comptroller as provided by Subchapter B, Chapter 133, Local Government Code [at least as frequently as monthly]. The comptroller shall deposit the fees in the judicial fund. (b) This section takes effect January 1, 2004. SECTION 73. (a) Section 51.941, Government Code, is amended to read as follows: Sec. 51.941. ADDITIONAL FILING FEE IN APPELLATE COURTS FOR BASIC CIVIL LEGAL SERVICES FOR INDIGENTS. (a) In addition to other fees authorized or required by law, the clerk of the supreme court and courts of appeals [each court] shall collect a $25 fee [the following fees] on the filing of any civil action or proceeding requiring a filing fee, including an appeal, and on the filing of any counterclaim, cross-action, intervention, interpleader, or third-party action requiring a filing fee[: [(1) supreme court and courts of appeals $25; [(2) district courts, for other than divorce and other family law matters $10; [(3) district courts, divorce and other family law matters $5; [(4) statutory and constitutional county courts . . $5; [(5) justice of the peace courts $2]. (b) Court fees under this section [subchapter] shall be collected in the same manner as other fees, fines, or costs in the case. (c) The clerk shall send the fees collected under this section [Subsection (a)(1)] to the comptroller not later than the last day of the month following [10th day after the end of] each calendar quarter. (d) [The clerk shall remit the fees collected under Subsections (a)(2)-(5) at least as frequently as monthly to the county treasurer or the person who performs the duties of the county treasurer. The county treasurer or the person performing the duties of the county treasurer shall keep a record of the amount of money received under this subsection. The county treasurer or the person who performs the duties of the county treasurer shall remit the fees collected, minus an amount ordered retained by the county commissioners court as provided by Subsection (e), to the comptroller not later than the 10th day after the end of each quarter. [(e) The commissioners court by order may require the county treasurer or the person who performs the duties of the county treasurer to deposit in the county's general revenue account five percent of the fees collected under Subsections (a)(2)-(5) to reimburse the county for the expense of collecting and remitting the fees collected under Subsections (a)(2)-(5). [(f)] The comptroller shall deposit the fees received under this section to the credit of the basic civil legal services account of the judicial fund for use in programs approved by the supreme court that provide basic civil legal services to the indigent. (e) [(g)] In this section, "indigent"[: [(1) "Family law matters" has the meaning assigned "family law cases and proceedings" by Section 25.0002. [(2) "Indigent"] means an individual who earns not more than 125 percent of the income standard established by applicable federal poverty guidelines. (b) This section takes effect January 1, 2004. SECTION 74. (a) Subsection (b), Section 118.015, Local Government Code, is amended to read as follows: (b) A county clerk who collects a fee under this section for a certified copy of a birth certificate shall deposit the fee into the county treasury. The state's portion of the fee shall be sent [deduct 20 cents of that fee to apply to the clerk's administrative costs and remit $1.80 of that fee] to the comptroller as provided by Subchapter B, Chapter 133, for deposit in the work and family policies fund. (b) This section takes effect January 1, 2004. SECTION 75. (a) Subsection (c), Section 118.018, Local Government Code, is amended to read as follows: (c) A county clerk who collects a fee under this section from a marriage license applicant shall deposit [remit] $3 of that fee to be sent to the comptroller as provided by Subchapter B, Chapter 133, for deposit in the family trust fund established under Section 2.014, Family Code. (b) This section takes effect January 1, 2004. SECTION 76. (a) Subsection (a), Section 118.022, Local Government Code, is amended to read as follows: (a) The county clerk shall deposit, as provided by Subchapter B, Chapter 133, [not later than the 10th day of each month, send to the comptroller of public accounts] $12.50 of each fee collected [during the preceding month] for issuance of a marriage license or declaration of informal marriage to be sent to the comptroller and deposited as provided by Subsection (b). (b) This section takes effect January 1, 2004. SECTION 77. (a) Section 542.403, Transportation Code, is amended by adding Subsection (c) to read as follows: (c) In this section, "conviction" has the meaning assigned by Section 133.101, Local Government Code. (b) This section takes effect January 1, 2004. SECTION 78. (a) Section 621.506, Transportation Code, is amended by amending Subsection (g) and adding Subsection (h) to read as follows: (g) Except as provided by Subsection (h), a [A] governmental entity that collects a fine under this section for an offense involving a vehicle having a single axle weight, tandem axle weight, or gross weight that is more than 5,000 pounds heavier than the vehicle's allowable weight shall send an amount equal to 50 percent of the fine to the comptroller in the manner provided by Subchapter B, Chapter 133, Local Government Code. (h) If [unless] the offense described by Subsection (g) occurred within 20 miles of an international border, [in which event] the entire amount of the fine shall be deposited for the purposes of road maintenance in: (1) the municipal treasury, if the fine was imposed by a municipal court; or (2) the county treasury, if the fine was imposed by a justice court. (b) This section takes effect January 1, 2004. SECTION 79. (a) Subsection (a), Section 706.006, Transportation Code, is amended to read as follows: (a) A person who fails to appear for a complaint or citation for an offense described by Section 706.002(a) shall be required to pay an administrative fee of $30 for each complaint or citation reported to the department under this chapter [violation for which the person failed to appear], unless the person is acquitted of the charges for which the person failed to appear. The person shall pay the fee when: (1) the court enters judgment on the underlying offense reported to the department; (2) the underlying offense is dismissed; or (3) bond or other security is posted to reinstate the charge for which the warrant was issued. (b) This section takes effect January 1, 2004. SECTION 80. (a) Subsections (a), (b), and (c), Section 706.007, Transportation Code, are amended to read as follows: (a) An officer collecting a fee under Section 706.006 shall keep records and deposit the money as provided by Subchapter B, Chapter 133, Local Government Code[: [(1) keep separate records of the money; and [(2) deposit the money in the appropriate municipal or county treasury]. (b) The custodian of the municipal or county treasury may[: [(1)] deposit each fee collected under Section 706.006 as provided by Subchapter B, Chapter 133, Local Government Code [in an interest-bearing account; and [(2) retain for the municipality or county the interest earned on money in the account]. (c) The custodian shall keep records of money received and disbursed under this section as provided by Subchapter B, Chapter 133, Local Government Code, and shall provide an annual report, in the form approved by the comptroller, of all money received and disbursed under this section to: (1) the comptroller; (2) the department; and (3) another entity as provided by interlocal contract. (b) This section takes effect January 1, 2004. SECTION 81. (a) Subchapter G, Chapter 51, Government Code, is amended by adding Section 51.607 to read as follows: Sec. 51.607. IMPLEMENTATION OF NEW OR AMENDED COURT COSTS AND FEES. (a) Following each regular session of the legislature, the comptroller shall identify each law enacted by that legislature, other than a law disapproved by the governor, that imposes or changes the amount of a court cost or fee collected by the clerk of a district, county, statutory county, municipal, or justice court from a party to a civil case or a defendant in a criminal case, including a filing or docketing fee, jury fee, cost on conviction, or fee or charge for services or to cover the expenses of a public official or agency. This subsection does not apply to attorney's fees, civil or criminal fines or penalties, or amounts charged, paid, or collected on behalf of another party to a proceeding other than the state in a criminal case, including restitution or damages. (b) The comptroller shall prepare a list of each court cost or fee covered by Subsection (a) to be imposed or changed and shall publish the list in the Texas Register not later than August 1 after the end of the regular session of the legislature at which the law imposing or changing the amount of the cost or fee was enacted. The comptroller shall include with the list a statement describing the operation of this section and stating the date the imposition or change in the amount of the court cost or fee will take effect under Subsection (c). (c) Notwithstanding the effective date of the law imposing or changing the amount of a court cost or fee included on the list, the imposition or change in the amount of the court cost or fee does not take effect until the next January 1 after the law takes effect. (d) This section does not apply to a court cost or fee if the law imposing or changing the amount of the cost or fee: (1) expressly provides that this section does not apply to the imposition or change in the amount of the cost or fee; or (2) takes effect before August 1 or after the next January 1 following the regular session of the legislature at which the law was enacted. (b) Section 51.607, Government Code, as added by this section, does not apply to a law that takes effect before September 1, 2003. (c) Section 51.607, Government Code, as added by this section, applies to a law enacted by the 78th Legislature, Regular Session, 2003, that takes effect on or after September 1, 2003, but only if this section takes effect before July 1, 2003. (d) This section takes effect immediately if this Act 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 section takes effect September 1, 2003. SECTION 82. The heading to Chapter 319, Government Code, is amended to read as follows:
CHAPTER 319. LEGISLATION REGARDING JUDICIAL SYSTEM
[IMPACT NOTES]
SECTION 83. Sections 319.001 through 319.004, Government Code, are designated as Subchapter A of Chapter 319 and the following heading is added to that subchapter:
SUBCHAPTER A. JUDICIAL SYSTEM IMPACT NOTES
SECTION 84. Chapter 319, Government Code, is amended by adding Subchapter B to read as follows:
SUBCHAPTER B. LEGISLATION RELATING TO COURT COSTS
Sec. 319.021. IMPACT STATEMENT ON LEGISLATION IMPOSING COURT COSTS ON CRIMINAL DEFENDANTS. (a) This section applies only to a new court cost or fee that is remitted to the comptroller. (b) The Legislative Budget Board shall prepare an impact statement for each resolution proposing a constitutional amendment or bill that proposes imposing a new court cost or fee on a person charged with a criminal offense or increasing the amount of an existing court cost or fee imposed on a person charged with a criminal offense, including a court cost or fee imposed on conviction or other disposition or postponed disposition of the criminal charge. (c) The impact statement must show the total amount of court costs and fees that persons will be required to pay under the bill or resolution when considered together with all other applicable laws. (d) The state auditor shall provide the Legislative Budget Board with the initial data needed to develop a mechanism that will be used to produce the impact statements. SECTION 85. (a) The following are repealed: (1) Article 56.55, Code of Criminal Procedure; (2) Article 56.56, Code of Criminal Procedure; (3) Article 56.57, Code of Criminal Procedure; (4) Article 56.59, Code of Criminal Procedure; (5) Subsections (f), (g), and (h), Article 102.011, Code of Criminal Procedure; (6) Article 102.019, Code of Criminal Procedure; (7) Article 102.075, Code of Criminal Procedure; (8) Section 51.701, Government Code; (9) Section 51.921, Government Code; and (10) Subsections (b) through (h), Section 56.001, Government Code. (b) This section takes effect January 1, 2004. SECTION 86. (a) Section 151.025, Tax Code, is amended by adding Subsection (d) to read as follows: (d) If any nontaxable charges are combined with and not separately stated from taxable telecommunications service charges on the customer bill or invoice of a provider of telecommunications services, the combined charge is subject to tax unless the provider can identify the portion of the charges that are nontaxable through the provider's books and records kept in the regular course of business. If the nontaxable charges cannot reasonably be identified, the charges from the sale of both nontaxable services and taxable telecommunications services are attributable to taxable telecommunications services. The provider of telecommunications services has the burden of proving nontaxable charges. (b) Section 151.025(c), Tax Code, is repealed. SECTION 87. Section 351.006, Tax Code, is amended by adding Subsection (g) to read as follows: (g) The right to use or possess a room in a hotel is exempt from taxation under this chapter if the person required to collect the tax receives, in good faith from a guest, an exemption certificate stating qualification for an exemption provided in Subsection (c). The exemption must be supported by the documentation required under rules adopted by the comptroller and the municipality. SECTION 88. Section 352.007, Tax Code, is amended by adding Subsection (g) to read as follows: (g) The right to use or possess a room in a hotel is exempt from taxation under this chapter if the person required to collect the tax receives, in good faith from a guest, an exemption certificate stating qualification for an exemption provided in Subsection (c). The exemption must be supported by the documentation required under rules adopted by the comptroller and the county. SECTION 89. Section 334.256(a), Local Government Code, is amended to read as follows: (a) Each bill or other receipt for a hotel charge subject to the tax imposed under this subchapter must contain a statement in a conspicuous location stating the applicable hotel occupancy tax rate collected by the hotel from the customer for the State of Texas (insert state rate of tax) and the tax rate and identity of each other taxing authority that has imposed a hotel occupancy tax for the room night (insert rate of tax). [:"___________ (insert name of taxing municipality or county) requires that an additional tax of _____ percent (insert rate of tax) be imposed on each hotel charge for the purpose of financing a venue project. In addition to the tax imposed to finance a venue project, the State of Texas requires that a tax of six percent be imposed on each hotel charge."] SECTION 90. Section 351.101(a), Tax Code, is amended to read as follows: (a) Revenue from the municipal hotel occupancy tax may be used only to promote tourism and the convention and hotel industry, and that use is limited to the following: (1) the acquisition of sites for and the construction, improvement, enlarging, equipping, repairing, operation, and maintenance of convention center facilities or visitor information centers, or both; (2) the furnishing of facilities, personnel, and materials for the registration of convention delegates or registrants; (3) advertising and conducting solicitations and promotional programs to attract tourists and convention delegates or registrants to the municipality or its vicinity; (4) the encouragement, promotion, improvement, and application of the arts, including instrumental and vocal music, dance, drama, folk art, creative writing, architecture, design and allied fields, painting, sculpture, photography, graphic and craft arts, motion pictures, radio, television, tape and sound recording, and other arts related to the presentation, performance, execution, and exhibition of these major art forms; (5) historical restoration and preservation projects or activities or advertising and conducting solicitations and promotional programs to encourage tourists and convention delegates to visit preserved historic sites or museums: (A) at or in the immediate vicinity of convention center facilities or visitor information centers; or (B) located elsewhere in the municipality or its vicinity that would be frequented by tourists and convention delegates; and (6) for a municipality located in a county with a population of 290,000 [65,000] or less, expenses, including promotion expenses, directly related to a sporting event in which the majority of participants are tourists who substantially increase economic activity at hotels and motels within the municipality or its vicinity. SECTION 91. Section 351.102, Tax Code, is amended by adding Subsection (c) to read as follows: (c) A municipality to which Subsection (b) applies is entitled to receive all funds that an owner of a project may receive under Section 151.429(h). SECTION 92. Section 2303.406, Government Code, is amended by adding Subsection (e) to read as follows: (e) The department may designate multiple concurrent enterprise projects in the same enterprise zone and may designate the same qualified business as more than one enterprise project. SECTION 93. The change in law made by this Act to Chapter 2303, Government Code, applies only to: (1) an application for enterprise project designation submitted on or after September 1, 2003; or (2) an application for enterprise project designation approved by the Texas Department of Economic Development or its successor on or after September 1, 2003, for which the application for enterprise project designation was submitted in calendar year 2002. SECTION 94. Section 151.319(c), Tax Code, is amended to read as follows: (c) The [A transaction involving the] sale of a handbill, circular, flyer, advertising supplement, or similar item that is printed to the special order of a customer and tangible personal property that will become an ingredient or component part of such item are [is] exempted from the taxes imposed by this chapter if the item is printed for the exclusive purpose of being distributed as a part of a newspaper, is actually distributed as a part of the newspaper, and is delivered to the person who is responsible for the distribution of the newspaper in which the item is distributed and not to the customer. SECTION 95. Subchapter Q, Chapter 171, Tax Code, is amended by adding Section 171.8015 to read as follows: Sec. 171.8015. TANGIBLE PERSONAL PROPERTY FIRST PLACED IN SERVICE IN AN ENTERPRISE ZONE. For purposes of determining whether an investment is a "qualified capital investment" under Section 171.801, "tangible personal property first placed in service in an enterprise zone" includes tangible personal property: (1) purchased by a qualified business for placement in an incomplete improvement that is under active construction or other physical preparation; (2) identified by a purchase order, invoice, billing, sales slip, or contract; and (3) physically present at the enterprise zone and in use by the qualified business not later than September 30, 2005. SECTION 96. Contingent on H.B. No. 2458, Acts of the 78th Legislature, Regular Session, 2003, being enacted and becoming law, and effective January 1, 2004, Sections 162.405(a) and (d), Tax Code, are amended to read as follows: (a) An offense under Section 162.403(1), (2), (3), (4), (5), (6), [(7),] or (8) is a Class C misdemeanor. (d) An offense under Section 162.403(7), (22), (23), (24), (25), (26), (27), (28), or (29) is a felony of the third degree. SECTION 97. (a) Except as otherwise provided by this or another section, this Act takes effect September 1, 2003. (b) Sections 14, 28, and 29 of this Act take effect October 1, 2003. (c) Section 15 of this Act applies only to a tax lien filed on or after the effective date of this Act. A tax lien filed before the effective date of this Act is governed by the law in effect on the date the tax lien is filed, and that law is continued in effect for that purpose. (d) Sections 2, 4, 5, 7, 8, and 9A of this Act take effect January 1, 2004. (e) Sections 38, 41, and 50 of this Act take effect January 1, 2004, and apply to reports originally due on or after that date. A report originally due before January 1, 2004, is governed by the law in effect on the date the report is originally due, and that law is continued in effect for that purpose. (f) Sections 43, 44, 45, 46, 47, 48, 49, and 95 of this Act apply only to a report originally due on or after the effective date of this Act. (g) Section 156.104(b), Tax Code, as added by Section 30 of this Act, takes effect January 1, 2004. (h) This Act takes effect July 1, 2003, 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 effect on that date, this Act takes effect October 1, 2003. The change in law made by this Act does not affect taxes imposed before the effective date of this Act, and the law in effect before the effective date of this Act is continued in effect for purposes of the liability for and collection of those taxes. ______________________________ ______________________________ President of the Senate Speaker of the House I certify that H.B. No. 2424 was passed by the House on May 16, 2003, by a non-record vote; that the House refused to concur in Senate amendments to H.B. No. 2424 on May 30, 2003, and requested the appointment of a conference committee to consider the differences between the two houses; and that the House adopted the conference committee report on H.B. No. 2424 on June 1, 2003, by a non-record vote; and that the House adopted S.C.R. No. 67 authorizing certain corrections in H.B. No. 2424 on June 2, 2003, by a non-record vote. ______________________________ Chief Clerk of the House I certify that H.B. No. 2424 was passed by the Senate, with amendments, on May 28, 2003, by a viva-voce vote; at the request of the House, the Senate appointed a conference committee to consider the differences between the two houses; and that the Senate adopted the conference committee report on H.B. No. 2424 on June 1, 2003, by the following vote: Yeas 31, Nays 0; and that the Senate adopted S.C.R. No. 67 authorizing certain corrections in H.B. No. 2424 on June 1, 2003. ______________________________ Secretary of the Senate APPROVED: __________________ Date __________________ Governor