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AN ACT
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relating to the Texas Economic Development Act; imposing a penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 313.002, 313.003, 313.004, and 313.007, |
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Tax Code, are amended to read as follows: |
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Sec. 313.002. FINDINGS. The legislature finds that: |
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(1) many states have enacted aggressive economic |
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development laws designed to attract large employers, create jobs, |
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and strengthen their economies; |
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(2) given Texas' relatively high ad valorem taxes, it |
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is difficult for the state to compete for new capital projects |
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without temporarily limiting ad valorem taxes imposed on new |
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capital investments [the State of Texas has slipped in its national
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ranking each year between 1993 and 2000 in terms of attracting major
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new manufacturing facilities to this state]; |
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(3) a significant portion of the Texas economy |
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continues to be based in [the] manufacturing and other |
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capital-intensive industries [industry], and their [the] continued |
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growth and overall health serve [of the manufacturing sector
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serves] the Texas economy well; |
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(4) without a vibrant, strong manufacturing sector, |
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other sectors of the economy, especially the state's service |
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sector, will also suffer adverse consequences; and |
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(5) the current ad valorem [property] tax system of |
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this state does not favor capital-intensive businesses such as |
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manufacturers. |
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Sec. 313.003. PURPOSES. The purposes of this chapter are |
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to: |
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(1) encourage large-scale capital investments in this |
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state[, especially in school districts that have an ad valorem tax
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base that is less than the statewide average ad valorem tax base of
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school districts in this state]; |
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(2) create new, high-paying jobs in this state; |
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(3) attract to this state [new,] large-scale |
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businesses that are exploring opportunities to locate in other |
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states or other countries; |
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(4) enable state and local government officials and |
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economic development professionals to compete with other states by |
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authorizing economic development incentives that are comparable to |
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[meet or exceed] incentives being offered to prospective employers |
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by other states and to provide state and local officials with an |
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effective means to attract large-scale investment; |
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(5) strengthen and improve the overall performance of |
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the economy of this state; |
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(6) expand and enlarge the ad valorem [property] tax |
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base of this state; and |
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(7) enhance this state's economic development efforts |
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by providing state and local officials [school districts] with an |
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effective [local] economic development tool [option]. |
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Sec. 313.004. LEGISLATIVE INTENT. It is the intent of the |
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legislature in enacting this chapter that: |
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(1) economic development decisions involving school |
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district taxes should occur at the local level with oversight by the |
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state and should be consistent with identifiable statewide economic |
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development goals; |
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(2) this chapter should not be construed or |
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interpreted to allow: |
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(A) property owners to pool investments to create |
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sufficiently large investments to qualify for an ad valorem tax |
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benefit [or financial benefit] provided by this chapter; |
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(B) an applicant for an ad valorem tax benefit |
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[or financial benefit] provided by this chapter to assert that jobs |
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will be eliminated if certain investments are not made if the |
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assertion is not true; or |
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(C) an entity not subject to the tax imposed by |
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Chapter 171 [a sole proprietorship, partnership, or limited
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liability partnership] to receive an ad valorem tax benefit [or
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financial benefit] provided by this chapter; [and] |
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(3) in implementing this chapter, school districts |
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should: |
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(A) strictly interpret the criteria and |
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selection guidelines provided by this chapter; and |
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(B) approve only those applications for an ad |
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valorem tax benefit [or financial benefit] provided by this chapter |
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that: |
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(i) enhance the local community; |
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(ii) improve the local public education |
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system; |
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(iii) create high-paying jobs; and |
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(iv) advance the economic development goals |
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of this state; and |
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(4) in implementing this chapter, the comptroller |
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should: |
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(A) strictly interpret the criteria and |
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selection guidelines provided by this chapter; and |
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(B) issue certificates for limitations on |
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appraised value only for those applications for an ad valorem tax |
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benefit provided by this chapter that: |
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(i) create high-paying jobs; |
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(ii) provide a net benefit to the state over |
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the long term; and |
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(iii) advance the economic development |
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goals of this state [as identified by the Texas Strategic Economic
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Development Planning Commission]. |
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Sec. 313.007. EXPIRATION. Subchapters B and [,] C [, and D] |
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expire December 31, 2022 [2014]. |
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SECTION 2. Subchapter A, Chapter 313, Tax Code, is amended |
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by adding Section 313.010 to read as follows: |
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Sec. 313.010. AUDIT OF AGREEMENTS BY STATE AUDITOR. (a) |
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Each year, the state auditor shall review at least three major |
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agreements, as determined by the state auditor, under this chapter |
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to determine whether: |
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(1) each agreement accomplishes the purposes of this |
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chapter as expressed in Section 313.003; |
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(2) each agreement complies with the intent of the |
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legislature in enacting this chapter as expressed in Section |
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313.004; and |
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(3) the terms of each agreement were executed in |
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compliance with the terms of this chapter. |
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(b) As part of the review, the state auditor shall make |
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recommendations relating to increasing the efficiency and |
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effectiveness of the administration of this chapter. |
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SECTION 3. Sections 313.021(2) and (3), Tax Code, are |
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amended to read as follows: |
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(2) "Qualified property" means: |
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(A) land: |
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(i) that is located in an area designated as |
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a reinvestment zone under Chapter 311 or 312 or as an enterprise |
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zone under Chapter 2303, Government Code; |
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(ii) on which a person proposes to |
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construct a new building or erect or affix a new improvement that |
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does not exist before the date the person submits a complete |
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application [applies] for a limitation on appraised value under |
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this subchapter; |
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(iii) that is not subject to a tax abatement |
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agreement entered into by a school district under Chapter 312; and |
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(iv) on which, in connection with the new |
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building or new improvement described by Subparagraph (ii), the |
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owner or lessee of, or the holder of another possessory interest in, |
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the land proposes to: |
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(a) make a qualified investment in an |
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amount equal to at least the minimum amount required by Section |
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313.023; and |
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(b) create at least 25 new qualifying |
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jobs; |
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(B) the new building or other new improvement |
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described by Paragraph (A)(ii); and |
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(C) tangible personal property that: |
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(i) is not subject to a tax abatement |
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agreement entered into by a school district under Chapter 312; and |
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(ii) except for new equipment described in |
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Section 151.318(q) or (q-1), is first placed in service in the new |
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building, in the newly expanded building, or in or on the new |
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improvement described by Paragraph (A)(ii), or on the land on which |
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that new building or new improvement is located, if the personal |
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property is ancillary and necessary to the business conducted in |
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that new building or in or on that new improvement. |
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(3) "Qualifying job" means a permanent full-time job |
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that: |
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(A) requires at least 1,600 hours of work a year; |
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(B) is not transferred from one area in this |
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state to another area in this state; |
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(C) is not created to replace a previous |
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employee; |
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(D) is covered by a group health benefit plan for |
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which the business offers to pay at least 80 percent of the premiums |
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or other charges assessed for employee-only coverage under the |
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plan, regardless of whether an employee may voluntarily waive the |
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coverage; and |
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(E) pays at least 110 percent of[:
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[(i)] the county average weekly wage for |
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manufacturing jobs in the county where the job is located[; or
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[(ii)
the county average weekly wage for
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all jobs in the county where the job is located, if the property
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owner creates more than 1,000 jobs in that county]. |
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(F) In determining whether a property owner has created the |
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number of qualifying jobs required under this chapter, operations, |
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services and other related jobs created in connection with the |
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project, including those employed by third parties under contract, |
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may satisfy the minimum qualifying jobs requirement for the project |
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if the Texas Workforce Commission determines that the cumulative |
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economic benefits to the state of these jobs is the same or greater |
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than that associated with the minimum number of qualified jobs |
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required to be created under this chapter. The Texas Workforce |
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Commission may adopt rules to implement this subsection. |
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SECTION 4. Section 313.024, Tax Code, is amended by |
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amending Subsections (a), (b), and (d) and adding Subsection (d-2) |
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to read as follows: |
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(a) This subchapter and Subchapter [Subchapters] C [and D] |
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apply only to property owned by an entity subject to the tax imposed |
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by [which] Chapter 171 [applies]. |
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(b) To be eligible for a limitation on appraised value under |
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this subchapter, the entity must use the property for [in
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connection with]: |
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(1) manufacturing; |
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(2) research and development; |
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(3) a clean coal project, as defined by Section 5.001, |
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Water Code; |
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(4) an advanced clean energy project, as defined by |
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Section 382.003, Health and Safety Code; |
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(5) renewable energy electric generation; |
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(6) electric power generation using integrated |
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gasification combined cycle technology; |
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(7) nuclear electric power generation; [or] |
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(8) a computer center primarily used in connection |
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with one or more activities described by Subdivisions (1) through |
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(7) conducted by the entity; or |
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(9) a Texas priority project. |
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(d) To be eligible for a limitation on appraised value under |
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this subchapter, the property owner must create the required number |
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of new [at least 80 percent of all the new jobs created by the
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property owner must be] qualifying jobs as defined by Section |
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313.021(3) and the average weekly wage for all jobs created by the |
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owner that are not qualifying jobs must exceed the county average |
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weekly wage for all jobs in the county where the jobs are located. |
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(d-2) For purposes of determining whether a property owner |
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has created the number of new qualifying jobs required for |
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eligibility for a limitation on appraised value under this |
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subchapter, the new qualifying jobs created under an agreement |
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between the property owner and another school district may be |
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included in the total number of new qualifying jobs created in |
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connection with the project if the Texas Economic Development and |
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Tourism Office determines that the projects covered by the |
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agreements constitute a single unified project. The Texas Economic |
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Development and Tourism Office may adopt rules to implement this |
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subsection. |
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SECTION 5. Section 313.024(e), Tax Code, is amended by |
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adding Subdivision (7) to read as follows: |
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(7) "Texas priority project" means a project on which |
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the applicant has committed to expend or allocate a qualified |
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investment of more than $1 billion. |
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SECTION 6. Sections 313.025(a), (a-1), (b), (b-1), (c), |
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(d), (d-1), (e), (g), and (i), Tax Code, are amended to read as |
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follows: |
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(a) The owner or lessee of, or the holder of another |
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possessory interest in, any qualified property described by Section |
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313.021(2)(A), (B), or (C) may apply to the governing body of the |
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school district in which the property is located for a limitation on |
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the appraised value for school district maintenance and operations |
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ad valorem tax purposes of the person's qualified property. An |
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application must be made on the form prescribed by the comptroller |
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and include the information required by the comptroller, and it |
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must be accompanied by: |
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(1) the application fee established by the governing |
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body of the school district; |
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(2) information sufficient to show that the real and |
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personal property identified in the application as qualified |
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property meets the applicable criteria established by Section |
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313.021(2); and |
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(3) any information required by the comptroller for |
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the purposes of [relating to each applicable criterion listed in] |
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Section 313.026. |
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(a-1) Within seven days of the receipt of each document, the |
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school district shall submit to the comptroller a copy of the |
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application and the proposed agreement between the applicant and |
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the school district. If the applicant submits an economic analysis |
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of the proposed project [is submitted] to the school district, the |
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district shall submit a copy of the analysis to the comptroller. In |
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addition, the school district shall submit to the comptroller any |
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subsequent revision of or amendment to any of those documents |
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within seven days of its receipt. The comptroller shall publish |
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each document received from the school district under this |
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subsection on the comptroller's Internet website. If the school |
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district maintains a generally accessible Internet website, the |
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district shall provide on its website a link to the location of |
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those documents posted on the comptroller's website in compliance |
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with this subsection. This subsection does not require the |
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comptroller to post information that is confidential under Section |
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313.028. |
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(b) The governing body of a school district is not required |
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to consider an application for a limitation on appraised value |
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[that is filed with the governing body under Subsection (a)]. If |
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the governing body of the school district elects [does elect] to |
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consider an application, the governing body shall deliver a copy |
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[three copies] of the application to the comptroller and request |
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that the comptroller conduct [provide] an economic impact |
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evaluation of the investment proposed by the application. The [to
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the school district.
Except as provided by Subsection (b-1), the] |
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comptroller shall conduct or contract with a third person to |
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conduct the economic impact evaluation, which shall be completed |
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and provided to the governing body of the school district, along |
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with the comptroller's certificate or written explanation under |
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Subsection (d), as soon as practicable but not later than the 90th |
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day after the date the comptroller receives the application. The |
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governing body shall provide to the comptroller or to a third person |
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contracted by the comptroller to conduct the economic impact |
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evaluation any requested information. A methodology to allow |
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comparisons of economic impact for different schedules of the |
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addition of qualified investment or qualified property may be |
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developed as part of the economic impact evaluation. The governing |
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body shall provide a copy of the economic impact evaluation to the |
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applicant on request. The comptroller may charge the applicant |
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[and collect] a fee sufficient to cover the costs of providing the |
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economic impact evaluation. The governing body of a school |
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district shall approve or disapprove an application not later than |
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the 150th [before the 151st] day after the date the application is |
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filed, unless the economic impact evaluation has not been received |
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or an extension is agreed to by the governing body and the |
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applicant. |
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(b-1) The comptroller shall promptly deliver a [indicate on
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one] copy of the application [the date the comptroller received the
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application and deliver that copy] to the Texas Education Agency. |
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The Texas Education Agency shall determine the effect that the |
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applicant's proposal will have on the number or size of the school |
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district's instructional facilities [, as required to be included
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in the economic impact evaluation by Section 313.026(a)(9),] and |
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submit a written report containing the agency's determination to |
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the school district [comptroller]. The governing body of the |
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school district shall provide any requested information to the |
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Texas Education Agency. Not later than the 45th day after the date |
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the Texas Education Agency receives [application indicates that the
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comptroller received] the application, the Texas Education Agency |
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shall make the required determination and submit the agency's |
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written report to the governing body of the school district |
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[comptroller.
A third person contracted by the comptroller to
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conduct an economic impact evaluation of an application is not
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required to make a determination that the Texas Education Agency is
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required to make and report to the comptroller under this
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subsection]. |
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(c) In determining whether to approve [grant] an |
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application, the governing body of the school district is entitled |
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to request and receive assistance from: |
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(1) the comptroller; |
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(2) the Texas [Department of] Economic Development and |
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Tourism Office; |
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(3) the Texas Workforce Investment Council; and |
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(4) the Texas Workforce Commission. |
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(d) Not later than the 90th [Before the 91st] day after the |
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date the comptroller receives the copy of the application, the |
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comptroller shall issue a certificate for a limitation on appraised |
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value of the property and provide the certificate to the governing |
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body of the school district or provide the governing body a written |
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explanation of the comptroller's decision not to issue a |
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certificate [submit a recommendation to the governing body of the
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school district as to whether the application should be approved or
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disapproved]. |
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(d-1) The governing body of a school district may not |
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approve an application unless [that] the comptroller submits to the |
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governing body a certificate for a limitation on appraised value of |
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the property [has recommended should be disapproved only if:
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[(1)
the governing body holds a public hearing the
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sole purpose of which is to consider the application and the
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comptroller's recommendation; and
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[(2)
at a subsequent meeting of the governing body
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held after the date of the public hearing, at least two-thirds of
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the members of the governing body vote to approve the application]. |
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(e) Before approving or disapproving an application under |
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this subchapter that the governing body of the school district |
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elects to consider, the governing body [of the school district] |
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must make a written finding as to any criteria considered by the |
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comptroller in conducting the economic impact evaluation under |
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[each criterion listed in] Section 313.026. The governing body |
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shall deliver a copy of those findings to the applicant. |
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(g) The Texas [Department of] Economic Development and |
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Tourism Office or its successor may recommend that a school |
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district approve an application [grant a person a limitation on
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appraised value] under this chapter. In determining whether to |
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approve [grant] an application, the governing body of the school |
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district shall consider any recommendation made by the Texas |
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[Department of] Economic Development and Tourism Office or its |
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successor. |
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(i) If the comptroller's determination under Subsection (h) |
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that the property does not meet the requirements of Section 313.024 |
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for eligibility for a limitation on appraised value under this |
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subchapter becomes final, the comptroller is not required to |
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provide an economic impact evaluation of the application or to |
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submit a certificate for a limitation on appraised value of the |
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property or a written explanation of the decision not to issue a |
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certificate [recommendation to the school district as to whether
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the application should be approved or disapproved], and the |
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governing body of the school district may not grant the |
|
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application. |
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SECTION 7. Section 313.026, Tax Code, is amended to read as |
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follows: |
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Sec. 313.026. ECONOMIC IMPACT EVALUATION. (a) The |
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economic impact evaluation of the application must include any |
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information the comptroller determines is necessary or helpful to: |
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(1) the governing body of the school district in |
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determining whether to approve the application under Section |
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313.025; or |
|
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(2) the comptroller in determining whether to issue a |
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certificate for a limitation on appraised value of the property |
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under Section 313.025 [the following:
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[(1) the recommendations of the comptroller;
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[(2) the name of the school district;
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[(3) the name of the applicant;
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[(4) the general nature of the applicant's investment;
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[(5)
the relationship between the applicant's industry
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and the types of qualifying jobs to be created by the applicant to
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the long-term economic growth plans of this state as described in
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the strategic plan for economic development submitted by the Texas
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Strategic Economic Development Planning Commission under Section
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481.033, Government Code, as that section existed before February
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1, 1999;
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[(6)
the relative level of the applicant's investment
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per qualifying job to be created by the applicant;
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[(7)
the number of qualifying jobs to be created by the
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applicant;
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[(8)
the wages, salaries, and benefits to be offered
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by the applicant to qualifying job holders;
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[(9)
the ability of the applicant to locate or
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relocate in another state or another region of this state;
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[(10)
the impact the project will have on this state
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and individual local units of government, including:
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[(A)
tax and other revenue gains, direct or
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indirect, that would be realized during the qualifying time period,
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the limitation period, and a period of time after the limitation
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period considered appropriate by the comptroller; and
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[(B)
economic effects of the project, including
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the impact on jobs and income, during the qualifying time period,
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the limitation period, and a period of time after the limitation
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period considered appropriate by the comptroller;
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|
[(11)
the economic condition of the region of the
|
|
|
state at the time the person's application is being considered;
|
|
|
[(12)
the number of new facilities built or expanded
|
|
|
in the region during the two years preceding the date of the
|
|
|
application that were eligible to apply for a limitation on
|
|
|
appraised value under this subchapter;
|
|
|
[(13)
the effect of the applicant's proposal, if
|
|
|
approved, on the number or size of the school district's
|
|
|
instructional facilities, as defined by Section 46.001, Education
|
|
|
Code;
|
|
|
[(14)
the projected market value of the qualified
|
|
|
property of the applicant as determined by the comptroller;
|
|
|
[(15)
the proposed limitation on appraised value for
|
|
|
the qualified property of the applicant;
|
|
|
[(16)
the projected dollar amount of the taxes that
|
|
|
would be imposed on the qualified property, for each year of the
|
|
|
agreement, if the property does not receive a limitation on
|
|
|
appraised value with assumptions of the projected appreciation or
|
|
|
depreciation of the investment and projected tax rates clearly
|
|
|
stated;
|
|
|
[(17)
the projected dollar amount of the taxes that
|
|
|
would be imposed on the qualified property, for each tax year of the
|
|
|
agreement, if the property receives a limitation on appraised value
|
|
|
with assumptions of the projected appreciation or depreciation of
|
|
|
the investment clearly stated;
|
|
|
[(18)
the projected effect on the Foundation School
|
|
|
Program of payments to the district for each year of the agreement;
|
|
|
[(19)
the projected future tax credits if the
|
|
|
applicant also applies for school tax credits under Section
|
|
|
313.103; and
|
|
|
[(20)
the total amount of taxes projected to be lost or
|
|
|
gained by the district over the life of the agreement computed by
|
|
|
subtracting the projected taxes stated in Subdivision (17) from the
|
|
|
projected taxes stated in Subdivision (16)]. |
|
|
(b) Except as provided by Subsections (c) and (d), the [The] |
|
|
comptroller's determination whether to issue a certificate for a |
|
|
limitation on appraised value under this chapter for property |
|
|
described in the application [recommendations] shall be based on |
|
|
the economic impact evaluation described by Subsection (a) |
|
|
[criteria listed in Subsections (a)(5)-(20)] and on any other |
|
|
information available to the comptroller, including information |
|
|
provided by the governing body of the school district [under
|
|
|
Section 313.025(b)]. |
|
|
(c) The comptroller may not issue a certificate for a |
|
|
limitation on appraised value under this chapter for property |
|
|
described in an application unless the comptroller determines that: |
|
|
(1) the project proposed by the applicant is |
|
|
reasonably likely to generate, before the 25th anniversary of the |
|
|
beginning of the limitation period, tax revenue, including state |
|
|
tax revenue, school district maintenance and operations ad valorem |
|
|
tax revenue attributable to the project, and any other tax revenue |
|
|
attributable to the effect of the project on the economy of the |
|
|
state, in an amount sufficient to offset the school district |
|
|
maintenance and operations ad valorem tax revenue lost as a result |
|
|
of the agreement; and |
|
|
(2) the limitation on appraised value is a determining |
|
|
factor in the applicant's decision to invest capital and construct |
|
|
the project in this state. |
|
|
(d) The comptroller shall state in writing the basis for the |
|
|
determinations made under Subsections (c)(1) and (2). |
|
|
(e) The applicant may submit information to the comptroller |
|
|
that would provide a basis for an affirmative determination under |
|
|
Subsection (c)(2). |
|
|
(f) Notwithstanding Subsections (c) and (d), if the |
|
|
comptroller makes a qualitative determination that other |
|
|
considerations associated with the project result in a net positive |
|
|
benefit to the state, the comptroller may issue the certificate. |
|
|
SECTION 8. Section 313.0265(b), Tax Code, is amended to |
|
|
read as follows: |
|
|
(b) The comptroller shall designate the following as |
|
|
substantive: |
|
|
(1) each application requesting a limitation on |
|
|
appraised value; and |
|
|
(2) the economic impact evaluation made in connection |
|
|
with the application [; and
|
|
|
[(3)
each application requesting school tax credits
|
|
|
under Section 313.103]. |
|
|
SECTION 9. Section 313.027, Tax Code, is amended by |
|
|
amending Subsections (a), (f), (h), and (i) and adding Subsections |
|
|
(a-1) and (j) to read as follows: |
|
|
(a) If the person's application is approved by the governing |
|
|
body of the school district, [for each of the first eight tax years
|
|
|
that begin after the applicable qualifying time period,] the |
|
|
appraised value for school district maintenance and operations ad |
|
|
valorem tax purposes of the person's qualified property as |
|
|
described in the agreement between the person and the district |
|
|
entered into under this section in the school district may not |
|
|
exceed the lesser of: |
|
|
(1) the market value of the property; or |
|
|
(2) subject to Subsection (b), the amount agreed to by |
|
|
the governing body of the school district. |
|
|
(a-1) The agreement must: |
|
|
(1) provide that the limitation under Subsection (a) |
|
|
applies for a period of 10 years; and |
|
|
(2) specify the beginning date of the limitation, |
|
|
which must be January 1 of the first tax year that begins after: |
|
|
(A) the application date; |
|
|
(B) the qualifying time period; or |
|
|
(C) the date commercial operations begin at the |
|
|
site of the project. |
|
|
(f) In addition, the agreement: |
|
|
(1) must incorporate each relevant provision of this |
|
|
subchapter and, to the extent necessary, include provisions for the |
|
|
protection of future school district revenues through the |
|
|
adjustment of the minimum valuations, the payment of revenue |
|
|
offsets, and other mechanisms agreed to by the property owner and |
|
|
the school district; |
|
|
(2) may provide that the property owner will protect |
|
|
the school district in the event the district incurs extraordinary |
|
|
education-related expenses related to the project that are not |
|
|
directly funded in state aid formulas, including expenses for the |
|
|
purchase of portable classrooms and the hiring of additional |
|
|
personnel to accommodate a temporary increase in student enrollment |
|
|
attributable to the project; |
|
|
(3) must require the property owner to maintain a |
|
|
viable presence in the school district for at least five [three] |
|
|
years after the date the limitation on appraised value of the |
|
|
owner's property expires; |
|
|
(4) must provide for the termination of the agreement, |
|
|
the recapture of ad valorem tax revenue lost as a result of the |
|
|
agreement if the owner of the property fails to comply with the |
|
|
terms of the agreement, and payment of a penalty or interest, or |
|
|
both, on that recaptured ad valorem tax revenue; |
|
|
(5) may specify any conditions the occurrence of which |
|
|
will require the district and the property owner to renegotiate all |
|
|
or any part of the agreement; [and] |
|
|
(6) must specify the ad valorem tax years covered by |
|
|
the agreement; and |
|
|
(7) must be in a form approved by the comptroller. |
|
|
(h) The agreement between the governing body of the school |
|
|
district and the applicant may provide for a deferral of the date on |
|
|
which the qualifying time period for the project is to commence or, |
|
|
subsequent to the date the agreement is entered into, be amended to |
|
|
provide for such a deferral. The agreement may not provide for the |
|
|
deferral of the date on which the qualifying time period is to |
|
|
commence to a date later than January 1 of the fourth tax year that |
|
|
begins after the date the application is approved except that if the |
|
|
agreement is one of a series of agreements related to the same |
|
|
project, the agreement may provide for the deferral of the date on |
|
|
which the qualifying time period is to commence to a date not later |
|
|
than January 1 of the sixth tax year that begins after the date the |
|
|
application is approved. This subsection may not be construed to |
|
|
permit a qualifying time period that has commenced to continue for |
|
|
more than the number of years applicable to the project under |
|
|
Section 313.021(4). |
|
|
(i) A person and the school district may not enter into an |
|
|
agreement under which the person agrees to provide supplemental |
|
|
payments to a school district or any other entity on behalf of a |
|
|
school district in an amount that exceeds an amount equal to the |
|
|
greater of $100 per student per year in average daily attendance, as |
|
|
defined by Section 42.005, Education Code, or $50,000 per year, or |
|
|
for a period that exceeds the period beginning with the period |
|
|
described by Section 313.021(4) and ending December 31 of the third |
|
|
tax year after the date the person's eligibility for a limitation |
|
|
under this chapter expires [with the period described by Section
|
|
|
313.104(2)(B) of this code]. This limit does not apply to amounts |
|
|
described by Subsection (f)(1) or (2) [of this section]. |
|
|
(j) An agreement under this chapter must disclose any |
|
|
consideration promised in conjunction with the application and the |
|
|
limitation. |
|
|
SECTION 10. Section 313.0275, Tax Code, is amended by |
|
|
amending Subsection (a) and adding Subsection (d) to read as |
|
|
follows: |
|
|
(a) Notwithstanding any other provision of this chapter to |
|
|
the contrary, a person with whom a school district enters into an |
|
|
agreement under this subchapter must make the minimum amount of |
|
|
qualified investment during the qualifying time period [and create
|
|
|
the required number of qualifying jobs during each year of the
|
|
|
agreement]. |
|
|
(d) In the event of a casualty loss that prevents a person |
|
|
from complying with Subsection (a), the person may request and the |
|
|
comptroller may grant a waiver of the penalty imposed under |
|
|
Subsection (b). |
|
|
SECTION 11. Subchapter B, Chapter 313, Tax Code, is amended |
|
|
by adding Section 313.0276 to read as follows: |
|
|
Sec. 313.0276. PENALTY FOR FAILURE TO COMPLY WITH |
|
|
JOB-CREATION REQUIREMENTS. (a) The comptroller shall conduct an |
|
|
annual review and issue a determination as to whether a person with |
|
|
whom a school district has entered into an agreement under this |
|
|
chapter satisfied in the preceding year the requirements of this |
|
|
chapter regarding the creation of the required number of qualifying |
|
|
jobs. If the comptroller makes an adverse determination in the |
|
|
review, the comptroller shall notify the person of the cause of the |
|
|
adverse determination and the corrective measures necessary to |
|
|
remedy the determination. |
|
|
(b) If a person who receives an adverse determination fails |
|
|
to remedy the determination following notification of the |
|
|
determination and the comptroller makes an adverse determination |
|
|
with respect to the person's compliance in the following year, the |
|
|
person must submit to the comptroller a plan for remedying the |
|
|
determination and certify the person's intent to fully implement |
|
|
the plan not later than December 31 of the year in which the |
|
|
determination is made. |
|
|
(c) If a person who receives an adverse determination under |
|
|
Subsection (b) fails to comply with that subsection following |
|
|
notification of the determination and receives an adverse |
|
|
determination in the following year, the comptroller shall impose a |
|
|
penalty on the person. The penalty is in an amount equal to the |
|
|
amount computed by: |
|
|
(1) subtracting from the number of qualifying jobs |
|
|
required to be created the number of qualifying jobs actually |
|
|
created; and |
|
|
(2) multiplying the amount computed under Subdivision |
|
|
(1) by the average annual wage for all jobs in the county during the |
|
|
most recent four quarters for which data is available. |
|
|
(d) Notwithstanding Subsection (c), if a person receives an |
|
|
adverse determination and the comptroller has previously imposed a |
|
|
penalty on the person under this section one or more times, the |
|
|
comptroller shall impose a penalty on the person in an amount equal |
|
|
to the amount computed by multiplying the amount computed under |
|
|
Subsection (c)(1) by an amount equal to twice the amount computed |
|
|
under Subsection (c)(2). |
|
|
(e) Notwithstanding Subsections (c) and (d), a penalty |
|
|
imposed under this section may not exceed an amount equal to the |
|
|
difference between the amount of the ad valorem tax benefit |
|
|
received by the person under the agreement in the preceding year and |
|
|
the amount of any supplemental payments made to the school district |
|
|
in that year. |
|
|
(f) A job created by a person that is not a qualifying job |
|
|
because the job does not meet a numerical requirement of Section |
|
|
313.021(3)(A), (D), or (E) is considered for purposes of this |
|
|
section to be a nonqualifying job only if the job fails to meet the |
|
|
numerical requirement by at least 10 percent. |
|
|
(g) An adverse determination under this section is a |
|
|
deficiency determination under Section 111.008. A penalty imposed |
|
|
under this section is an amount the comptroller is required to |
|
|
collect, receive, administer, or enforce, and the determination is |
|
|
subject to the payment and redetermination requirements of Sections |
|
|
111.0081 and 111.009. |
|
|
(h) A redetermination under Section 111.009 of an adverse |
|
|
determination under this section is a contested case as defined by |
|
|
Section 2001.003, Government Code. |
|
|
(i) If a person on whom a penalty is imposed under this |
|
|
section contends that the amount of the penalty is unlawful or that |
|
|
the comptroller may not legally demand or collect the penalty, the |
|
|
person may challenge the determination of the comptroller under |
|
|
Subchapters A and B, Chapter 112. |
|
|
(j) If the comptroller imposes a penalty on a person under |
|
|
this section three times, the comptroller may rescind the agreement |
|
|
between the person and the school district under this chapter. |
|
|
(k) A person may contest a determination by the comptroller |
|
|
to rescind an agreement between the person and a school district |
|
|
under this chapter pursuant to Subsection (j) by filing suit |
|
|
against the comptroller and the attorney general. The district |
|
|
courts of Travis County have exclusive, original jurisdiction of a |
|
|
suit brought under this subsection. This subsection prevails over |
|
|
a provision of Chapter 25, Government Code, to the extent of any |
|
|
conflict. |
|
|
(l) If a person files suit under Subsection (k) and the |
|
|
comptroller's determination to rescind the agreement is upheld on |
|
|
appeal, the person shall pay to the comptroller any tax that would |
|
|
have been due and payable to the school district during the pendency |
|
|
of the appeal, including statutory interest and penalties imposed |
|
|
on delinquent taxes under Sections 111.060 and 111.061. |
|
|
(m) The comptroller shall deposit a penalty collected under |
|
|
this section, including any interest and penalty applicable to the |
|
|
penalty, to the credit of the foundation school fund. |
|
|
SECTION 12. Section 313.031, Tax Code, is amended to read as |
|
|
follows: |
|
|
Sec. 313.031. RULES AND FORMS; FEES. (a) The comptroller |
|
|
shall: |
|
|
(1) adopt rules and forms necessary for the |
|
|
implementation and administration of this chapter, including rules |
|
|
for determining whether a property owner's property qualifies as a |
|
|
qualified investment under Section 313.021(1); and |
|
|
(2) provide without charge one copy of the rules and |
|
|
forms to any school district and to any person who states that the |
|
|
person intends to apply for a limitation on appraised value under |
|
|
this subchapter [or a tax credit under Subchapter D]. |
|
|
(b) The governing body of a school district by official |
|
|
action shall establish reasonable nonrefundable application fees |
|
|
to be paid by property owners who apply to the district for a |
|
|
limitation on the appraised value of the person's property under |
|
|
this subchapter. The amount of an application fee must be |
|
|
reasonable and may not exceed the estimated cost to the district of |
|
|
processing and acting on an application, including any cost to the |
|
|
school district associated with [the cost of] the economic impact |
|
|
evaluation required by Section [Sections] 313.025 [and 313.026]. |
|
|
SECTION 13. Section 313.032, Tax Code, is amended by |
|
|
amending Subsections (a) and (c) and adding Subsections (b-1) and |
|
|
(d) to read as follows: |
|
|
(a) Before the beginning of each regular session of the |
|
|
legislature, the comptroller shall submit to the lieutenant |
|
|
governor, the speaker of the house of representatives, and each |
|
|
other member of the legislature a report on the agreements entered |
|
|
into under this chapter that includes: |
|
|
(1) an assessment of the following with regard to the |
|
|
agreements entered into under this chapter, considered in the |
|
|
aggregate: |
|
|
(A) the total number of jobs created, direct and |
|
|
otherwise, in this state; |
|
|
(B) the total effect on personal income, direct |
|
|
and otherwise, in this state; |
|
|
(C) the total amount of investment in this state; |
|
|
(D) the total taxable value of property on the |
|
|
tax rolls in this state, including property for which the |
|
|
limitation period has expired; |
|
|
(E) the total value of property not on the tax |
|
|
rolls in this state as a result of agreements entered into under |
|
|
this chapter; and |
|
|
(F) the total fiscal effect on the state and |
|
|
local governments; and |
|
|
(2) an assessment of [assessing] the progress of each |
|
|
agreement made under this chapter that states[.
The report must be
|
|
|
based on data certified to the comptroller by each recipient of a
|
|
|
limitation on appraised value under this subchapter and state] for |
|
|
each agreement: |
|
|
(A) [(1)] the number of qualifying jobs each |
|
|
recipient of a limitation on appraised value committed to create; |
|
|
(B) [(2)] the number of qualifying jobs each |
|
|
recipient created; |
|
|
(C) [(3)] the total amount of wages and the |
|
|
median wage of the new qualifying jobs each recipient created; |
|
|
(D) [(4)] the amount of the qualified investment |
|
|
each recipient committed to spend or allocate for each project; |
|
|
(E) [(5)] the amount of the qualified investment |
|
|
each recipient spent or allocated for each project; |
|
|
(F) [(6)] the market value of the qualified |
|
|
property of each recipient as determined by the applicable chief |
|
|
appraiser, including property that is no longer eligible for a |
|
|
limitation on appraised value under the agreement; |
|
|
(G) [(7)] the limitation on appraised value for |
|
|
the qualified property of each recipient; |
|
|
(H) [(8)] the dollar amount of the taxes that |
|
|
would have been imposed on the qualified property if the property |
|
|
had not received a limitation on appraised value; and |
|
|
(I) [(9)] the dollar amount of the taxes imposed |
|
|
on the qualified property[;
|
|
|
[(10)
the number of new jobs created by each recipient
|
|
|
in each sector of the North American Industry Classification
|
|
|
System; and
|
|
|
[(11)
of the number of new jobs each recipient
|
|
|
created, the number of jobs created that provide health benefits
|
|
|
for employees]. |
|
|
(b-1) In preparing the portion of the report described by |
|
|
Subsection (a)(1), the comptroller may use standard economic |
|
|
estimation techniques, including economic multipliers. |
|
|
(c) The portion of the report described by Subsection (a)(2) |
|
|
must be based on data certified to the comptroller by each recipient |
|
|
or former recipient of a limitation on appraised value under this |
|
|
chapter. |
|
|
(d) The comptroller may require a recipient or former |
|
|
recipient of a limitation on appraised value under this chapter to |
|
|
submit, on a form the comptroller provides, information required to |
|
|
complete the report. |
|
|
SECTION 14. Subchapter B, Chapter 313, Tax Code, is amended |
|
|
by adding Section 313.033 to read as follows: |
|
|
Sec. 313.033. REPORT ON COMPLIANCE WITH JOB-CREATION |
|
|
REQUIREMENTS. Each recipient of a limitation on appraised value |
|
|
under this chapter shall submit to the comptroller an annual report |
|
|
on a form provided by the comptroller that provides information |
|
|
sufficient to document the number of qualifying jobs created. |
|
|
SECTION 15. The heading to Subchapter C, Chapter 313, Tax |
|
|
Code, is amended to read as follows: |
|
|
SUBCHAPTER C. LIMITATION ON APPRAISED VALUE OF PROPERTY IN |
|
|
STRATEGIC INVESTMENT AREA OR CERTAIN RURAL SCHOOL DISTRICTS |
|
|
SECTION 16. Section 313.051, Tax Code, is amended to read as |
|
|
follows: |
|
|
Sec. 313.051. APPLICABILITY. (a) In this section, |
|
|
"strategic investment area" means an area the comptroller |
|
|
determines under Subsection (a-3) is: |
|
|
(1) a county within this state with unemployment above |
|
|
the state average and per capita income below the state average; |
|
|
(2) an area within this state that is a federally |
|
|
designated urban enterprise community or an urban enhanced |
|
|
enterprise community; or |
|
|
(3) a defense economic readjustment zone designated |
|
|
under Chapter 2310, Government Code. |
|
|
(a-1) This subchapter applies only to a school district that |
|
|
has territory in: |
|
|
(1) an area that qualifies [qualified] as a strategic |
|
|
investment area [under Subchapter O, Chapter 171, immediately
|
|
|
before that subchapter expired]; or |
|
|
(2) a county: |
|
|
(A) that has a population of less than 50,000; |
|
|
and |
|
|
(B) in which, from 2000 [1990] to 2010 [2000], |
|
|
according to the federal decennial census, the population: |
|
|
(i) remained the same; |
|
|
(ii) decreased; or |
|
|
(iii) increased, but at a rate of not more |
|
|
than the average rate of increase in the state during that period |
|
|
[three percent per annum]. |
|
|
(a-2) [(a-1)] Notwithstanding Subsection (a-1) [(a)], if on |
|
|
January 1, 2002, this subchapter applied to a school district in |
|
|
whose territory is located a federal nuclear facility, this |
|
|
subchapter continues to apply to the school district regardless of |
|
|
whether the school district ceased or ceases to be described by |
|
|
Subsection (a-1) [(a)] after that date. |
|
|
(a-3) Not later than September 1 of each year, the |
|
|
comptroller shall determine areas that qualify as a strategic |
|
|
investment area using the most recently completed full calendar |
|
|
year data available on that date and, not later than October 1, |
|
|
shall publish a list and map of the designated areas. A |
|
|
determination under this subsection is effective for the following |
|
|
tax year for purposes of this subchapter. |
|
|
(b) The governing body of a school district to which this |
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subchapter applies may enter into an agreement in the same manner as |
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a school district to which Subchapter B applies may do so under |
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Subchapter B, subject to Sections 313.052-313.054. Except as |
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otherwise provided by this subchapter, the provisions of Subchapter |
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B apply to a school district to which this subchapter applies. For |
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purposes of this subchapter, a property owner is required to create |
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[only] at least 10 new qualifying jobs as defined by Section |
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313.021(3) on the owner's qualified property. [At least 80 percent
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of all the new jobs created must be qualifying jobs as defined by
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Section 313.021(3), except that, for a school district described by
|
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Subsection (a)(2), each qualifying job must pay at least 110
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percent of the average weekly wage for manufacturing jobs in the
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region designated for the regional planning commission, council of
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governments, or similar regional planning agency created under
|
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Chapter 391, Local Government Code, in which the district is
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located.] |
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SECTION 17. Section 313.054(a), Tax Code, is amended to |
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read as follows: |
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(a) For a school district to which this subchapter applies, |
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|
the amount agreed to by the governing body of the district under |
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|
Section 313.027(a)(2) must be an amount in accordance with the |
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following, according to the category established by Section 313.052 |
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to which the school district belongs: |
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|
CATEGORY |
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MINIMUM AMOUNT OF LIMITATION |
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SECTION 18. The heading to Subchapter E, Chapter 313, Tax |
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|
Code, is amended to read as follows: |
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SUBCHAPTER E. AVAILABILITY OF TAX CREDIT AFTER PROGRAM |
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EXPIRES OR IS REPEALED |
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SECTION 19. Section 313.171(b), Tax Code, is amended to |
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|
read as follows: |
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(b) The repeal [expiration] of Subchapter D does not affect |
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|
a property owner's entitlement to a tax credit granted under |
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|
Subchapter D if the property owner qualified for the tax credit |
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|
before the repeal [expiration] of Subchapter D. |
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|
SECTION 20. Section 42.2515(a), Education Code, is amended |
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|
to read as follows: |
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|
(a) For each school year, a school district, including a |
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|
school district that is otherwise ineligible for state aid under |
|
|
this chapter, is entitled to state aid in an amount equal to the |
|
|
amount of all tax credits credited against ad valorem taxes of the |
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district in that year under former Subchapter D, Chapter 313, Tax |
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|
Code. |
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|
SECTION 21. Section 42.302(e), Education Code, is amended |
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|
to read as follows: |
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|
(e) For purposes of this section, school district taxes for |
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|
which credit is granted under former Subchapter D, Chapter 313, Tax |
|
|
Code, are considered taxes collected by the school district as if |
|
|
the taxes were paid when the credit for the taxes was granted. |
|
|
SECTION 22. The following provisions of the Tax Code are |
|
|
repealed: |
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|
(1) Sections 313.008 and 313.009; and |
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|
(2) Subchapter D, Chapter 313. |
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|
SECTION 23. (a) Except as provided by Subsection (b) of |
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|
this section, Chapter 313, Tax Code, as amended by this Act, applies |
|
|
only to an application filed under that chapter on or after the |
|
|
effective date of this Act. An application filed under that chapter |
|
|
before the effective date of this Act is governed by the law in |
|
|
effect on the date the application was filed, and the former law is |
|
|
continued in effect for that purpose. |
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|
(b) An agreement entered into on or after January 1, 2013, |
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|
pursuant to an application filed under Chapter 313, Tax Code, |
|
|
before the effective date of this Act may condition eligibility for |
|
|
a limitation on appraised value under Subchapter B or C of that |
|
|
chapter, as applicable, on compliance with the provisions of that |
|
|
chapter, as amended by this Act, relating to the creation of new |
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|
jobs, including Section 313.021(3), Tax Code, and Section |
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|
313.024(d) or 313.051(b), Tax Code, as applicable. |
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|
SECTION 24. The comptroller shall make the initial |
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|
determination under Section 313.051(a-3), Tax Code, as added by |
|
|
this Act, not later than September 1, 2014, and shall publish the |
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|
initial list and map required by that subsection not later than |
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|
October 1, 2014. |
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SECTION 25. This Act takes effect January 1, 2014. |
| |
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| |
______________________________ |
______________________________ |
| |
President of the Senate |
Speaker of the House |
| |
| |
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|
I certify that H.B. No. 3390 was passed by the House on May 4, |
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|
2013, by the following vote: Yeas 129, Nays 7, 2 present, not |
|
|
voting; that the House refused to concur in Senate amendments to |
|
|
H.B. No. 3390 on May 24, 2013, and requested the appointment of a |
|
|
conference committee to consider the differences between the two |
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|
houses; and that the House adopted the conference committee report |
|
|
on H.B. No. 3390 on May 26, 2013, by the following vote: Yeas 138, |
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|
Nays 6, 2 present, not voting. |
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______________________________ |
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Chief Clerk of the House |
| |
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I certify that H.B. No. 3390 was passed by the Senate, with |
|
|
amendments, on May 21, 2013, by the following vote: Yeas 29, Nays |
|
|
2; 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. |
|
|
3390 on May 26, 2013, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: __________________ |
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Date |
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__________________ |
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Governor |