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A BILL TO BE ENTITLED
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AN ACT
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relating to tax increment financing. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 311.005, Tax Code, is amended by |
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amending Subsection (a) and adding Subsection (c) to read as |
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follows: |
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(a) To be designated as a reinvestment zone, an area must: |
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(1) substantially arrest or impair the sound growth of |
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the municipality or county designating the zone, retard the |
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provision of housing accommodations, or constitute an economic or |
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social liability and be a menace to the public health, safety, |
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morals, or welfare in its present condition and use because of the |
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presence of: |
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(A) a substantial number of substandard, slum, |
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deteriorated, or deteriorating structures; |
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(B) the predominance of defective or inadequate |
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sidewalk or street layout; |
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(C) faulty lot layout in relation to size, |
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adequacy, accessibility, or usefulness; |
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(D) unsanitary or unsafe conditions; |
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(E) the deterioration of site or other |
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improvements; |
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(F) tax or special assessment delinquency |
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exceeding the fair value of the land; |
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(G) defective or unusual conditions of title; |
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(H) conditions that endanger life or property by |
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fire or other cause; or |
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(I) structures, other than single-family |
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residential structures, less than 10 percent of the square footage |
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of which has been used for commercial, industrial, or residential |
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purposes during the preceding 12 years, if the municipality has a |
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population of 100,000 or more; |
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(2) be predominantly open or undeveloped and, because |
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of obsolete platting, deterioration of structures or site |
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improvements, or other factors, substantially impair or arrest the |
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sound growth of the municipality or county; |
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(3) be in a federally assisted new community located |
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in the municipality or county or in an area immediately adjacent to |
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a federally assisted new community; or |
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(4) be an area that is: |
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(A) described in a petition requesting that the |
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area be designated as a reinvestment zone, if the petition is |
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submitted to the governing body of the municipality or county by the |
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owners of property constituting at least 50 percent of the |
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appraised value of the property in the area according to the most |
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recent certified appraisal roll for the county in which the area is |
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located; and |
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(B) unproductive, underdeveloped, or blighted. |
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(c) The attorney general shall determine, by application of |
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accepted legal principles, the meaning of "unproductive," |
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"underdeveloped," and "blighted" for purposes of Subsection (a)(4) |
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and by rule define those terms. |
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SECTION 2. Section 311.0085(c), Tax Code, is amended to |
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read as follows: |
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(c) In addition to exercising the powers described by |
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Section 311.008, a municipality may enter into a new agreement, or |
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amend an existing agreement, with a school district that is located |
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in whole or in part in a reinvestment zone created by the |
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municipality to dedicate revenue from the tax increment fund to the |
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school district for acquiring, constructing, or reconstructing an |
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educational facility located in [or outside of] the zone. |
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SECTION 3. Section 311.010(b), Tax Code, is amended to read |
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as follows: |
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(b) The board of directors of a reinvestment zone and the |
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governing body of the municipality or county that creates a |
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reinvestment zone may each enter into agreements as the board or the |
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governing body considers necessary or convenient to implement the |
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project plan and reinvestment zone financing plan and achieve their |
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purposes. An agreement may provide for the regulation or |
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restriction of the use of land by imposing conditions, |
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restrictions, or covenants that run with the land. An agreement may |
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during the term of the agreement dedicate, pledge, or otherwise |
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provide for the use of revenue in the tax increment fund to pay any |
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project costs that benefit the reinvestment zone, including project |
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costs relating to the cost of buildings, schools, or other |
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educational facilities owned by or on behalf of a school district, |
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community college district, or other political subdivision of this |
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state, railroad or transit facilities, affordable housing, the |
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remediation of conditions that contaminate public or private land |
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or buildings, the preservation of the facade of a private or public |
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building, the demolition of public or private buildings, or the |
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construction of a road, sidewalk, or other public infrastructure in |
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[or out of] the zone, including the cost of acquiring the real |
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property necessary for the construction of the road, sidewalk, or |
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other public infrastructure. An agreement may dedicate revenue |
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from the tax increment fund to pay the costs of providing affordable |
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housing or areas of public assembly in [or out of] the zone. |
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SECTION 4. Section 311.015, Tax Code, is amended by adding |
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Subsections (m) and (n) to read as follows: |
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(m) Not later than the seventh day before the date of the |
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meeting at which the governing body of the municipality will vote on |
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an ordinance to issue tax increment bonds or notes, the |
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municipality must provide notice of the date, time, and place of the |
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meeting by delivering the notice by mail to: |
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(1) each property owner in the municipality; |
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(2) the commissioners court of each county in which a |
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portion of the reinvestment zone is located; and |
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(3) each state senator and representative whose |
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district includes territory in a county in which a portion of the |
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reinvestment zone is located. |
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(n) At the time a municipality submits tax increment bonds |
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and the record of proceedings relating to the authorization of the |
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bonds to the attorney general under Section 1202.003, Government |
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Code, the municipality must deliver notice of the submission by |
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mail to: |
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(1) the commissioners court of each county in which a |
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portion of the reinvestment zone is located; and |
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(2) each state senator and representative whose |
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district includes territory in a county in which a portion of the |
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reinvestment zone is located. |
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SECTION 5. Chapter 311, Tax Code, is amended by adding |
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Section 311.0155 to read as follows: |
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Sec. 311.0155. ATTORNEY GENERAL DETERMINATION REGARDING |
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REINVESTMENT ZONE. (a) A municipality designating a reinvestment |
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zone may not undertake the initial issuance of tax increment bonds |
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for the zone unless: |
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(1) the municipality provides evidence to the attorney |
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general demonstrating that the zone: |
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(A) meets the requirements of Section 311.005; |
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and |
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(B) is not ineligible for designation as a |
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reinvestment zone under Section 311.006; and |
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(2) the attorney general determines that the evidence |
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is legally sufficient. |
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(b) The attorney general shall provide a legal sufficiency |
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determination not later than the 60th business day after the date |
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the evidence required by Subsection (a) is received. If the |
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attorney general cannot provide a legal sufficiency determination |
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within the 60-business-day period, the attorney general shall |
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notify the municipality in writing of the reason for the delay and |
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may extend the review period for not more than 30 business days. |
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(c) After the attorney general issues a legal sufficiency |
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determination, the municipality may supplement the evidence |
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submitted or amend the ordinance designating the reinvestment zone |
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to facilitate a redetermination by the attorney general of the |
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prior legal sufficiency determination issued under this section. |
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(d) The attorney general may adopt rules as necessary to |
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implement this section. |
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SECTION 6. Sections 311.01005 and 311.014(f), Tax Code, are |
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repealed. |
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SECTION 7. The attorney general shall adopt rules under |
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Section 311.005(c), Tax Code, as added by this Act, not later than |
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January 1, 2018. |
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SECTION 8. Section 311.005(a), Tax Code, as amended by this |
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Act, applies only to a reinvestment zone designated on or after the |
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date the rules adopted under Section 311.005(c), Tax Code, as added |
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by this Act, take effect. A reinvestment zone designated before the |
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date the rules adopted under Section 311.005(c), Tax Code, as added |
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by this Act, take effect is governed by the law as it existed |
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immediately before the effective date of this Act, and that law is |
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continued in effect for that purpose. |
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SECTION 9. Sections 311.0085(c) and 311.010(b), Tax Code, |
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as amended by this Act, apply only to a new agreement entered into |
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on or after the effective date of this Act or an amendment on or |
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after the effective date of this Act to an existing agreement. A |
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new agreement entered into before the effective date of this Act or |
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an amendment before the effective date of this Act to an existing |
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agreement is governed by the law as it existed immediately before |
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the effective date of this Act, and that law is continued in effect |
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for that purpose. |
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SECTION 10. The repeal of Section 311.01005, Tax Code, by |
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this Act does not affect an agreement described by former Section |
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311.01005(c), Tax Code, that is entered into before the effective |
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date of this Act. An agreement described by former Section |
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311.01005(c), Tax Code, that is entered into before the effective |
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date of this Act is governed by the law as it existed immediately |
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before the effective date of this Act, and that law is continued in |
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effect for that purpose. |
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SECTION 11. The repeal of Section 311.014(f), Tax Code, by |
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this Act does not affect a transfer of money described by that |
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subsection that occurs before the effective date of this Act. A |
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transfer of money described by former Section 311.014(f), Tax Code, |
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that occurs before the effective date of this Act is governed by the |
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law as it existed immediately before the effective date of this Act, |
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and that law is continued in effect for that purpose. |
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SECTION 12. Section 311.015(m), Tax Code, as added by this |
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Act, applies only to a meeting to vote on an ordinance to issue tax |
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increment bonds or notes that is held on or after the effective date |
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of this Act. A meeting to vote on an ordinance to issue tax |
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increment bonds or notes that is held before the effective date of |
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this Act is governed by the law as it existed immediately before the |
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effective date of this Act, and that law is continued in effect for |
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that purpose. |
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SECTION 13. Section 311.015(n), Tax Code, as added by this |
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Act, applies only to tax increment bonds that are submitted to the |
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attorney general for approval on or after the effective date of this |
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Act. Tax increment bonds that are submitted to the attorney general |
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for approval before the effective date of this Act are governed by |
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the law as it existed immediately before the effective date of this |
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Act, and that law is continued in effect for that purpose. |
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SECTION 14. Section 311.0155, Tax Code, as added by this |
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Act, applies only to an initial issuance of tax increment bonds for |
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a reinvestment zone that is undertaken on or after the effective |
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date of this Act. An initial issuance of tax increment bonds for a |
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reinvestment zone that is undertaken before the effective date of |
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this Act is governed by the law as it existed immediately before the |
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effective date of this Act, and that law is continued in effect for |
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that purpose. |
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SECTION 15. This Act takes effect September 1, 2017. |