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  S.B. No. 1266
 
 
 
 
AN ACT
  relating to pass-through financing and the designation and
  operation of transportation reinvestment zones.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 222.104, Transportation Code, is amended
  by adding Subsection (d-1) and amending Subsection (e) to read as
  follows:
         (d-1)  Unless there is an insufficient number of approved
  proposals for projects to be developed under an agreement providing
  for the payment of pass-through tolls, in any state fiscal year that
  begins on or after September 1, 2007, the amount the department
  agrees to pay under agreements entered into under this section as
  reimbursement to a public or private entity for project costs may
  not be less than the yearly average of such amounts from the date of
  the creation by the commission of the pass-through toll program.
  This subsection expires September 1, 2009.
         (e)  The department may use any available funds for the
  purpose of making a pass-through toll payment under this section
  except funds derived from the issuance of bonds under Section
  201.943.
         SECTION 2.  Subchapter E, Chapter 222, Transportation Code,
  is amended by adding Sections 222.105, 222.106, and 222.107 to read
  as follows:
         Sec. 222.105.  PURPOSES. The purposes of Sections 222.106
  and 222.107 are to:
               (1)  promote public safety;
               (2)  facilitate the development or redevelopment of
  property;
               (3)  facilitate the movement of traffic; and
               (4)  enhance a local entity's ability to sponsor a
  project authorized under Section 222.104.
         Sec. 222.106.  MUNICIPAL TRANSPORTATION REINVESTMENT ZONES.
  (a)  In this section:
               (1)  the amount of a municipality's tax increment for a
  year is the amount of ad valorem taxes levied and collected by the
  municipality for that year on the captured appraised value of real
  property taxable by the municipality and located in a
  transportation reinvestment zone under this section;
               (2)  the captured appraised value of real property
  taxable by a municipality for a year is the total appraised value of
  all real property taxable by the municipality and located in a
  transportation reinvestment zone for that year less the tax
  increment base of the municipality; and
               (3)  the tax increment base of a municipality is the
  total appraised value of all real property taxable by the
  municipality and located in a transportation reinvestment zone for
  the year in which the zone was designated under this section.
         (b)  This section applies only to a municipality the
  governing body of which intends to enter into an agreement with the
  department under Section 222.104.
         (c)  If the governing body determines an area to be
  unproductive and underdeveloped and that action under this section
  will further the purposes stated in Section 222.105, the governing
  body of the municipality by ordinance may designate a contiguous
  geographic area in the jurisdiction of the municipality to be a
  transportation reinvestment zone to promote a transportation
  project described by Section 222.104 that cultivates development or
  redevelopment of the area.
         (d)  The governing body must comply with all applicable laws
  in the application of this chapter.
         (e)  Not later than the 30th day before the date the
  governing body of the municipality proposes to adopt an ordinance
  designating an area as a transportation reinvestment zone under
  this section, the governing body must hold a public hearing on the
  designation of the zone and its benefits to the municipality and to
  property in the proposed zone. At the hearing an interested person
  may speak for or against the creation of the zone or its boundaries.
  Not later than the seventh day before the date of the hearing,
  notice of the hearing and the intent to create the zone must be
  published in a newspaper having general circulation in the
  municipality.
         (f)  Compliance with the requirements of this section
  constitutes designation of an area as a transportation reinvestment
  zone without further hearings or other procedural requirements.
         (g)  The ordinance designating an area as a transportation
  reinvestment zone must:
               (1)  describe the boundaries of the zone with
  sufficient definiteness to identify with ordinary and reasonable
  certainty the territory included in the zone;
               (2)  provide that the zone takes effect immediately on
  passage of the ordinance;
               (3)  assign a name to the zone for identification, with
  the first zone designated by a municipality designated as
  "Transportation Reinvestment Zone Number One, (City or Town, as
  applicable) of (name of municipality)," and subsequently
  designated zones assigned names in the same form, numbered
  consecutively in the order of their designation;
               (4)  establish an ad valorem tax increment account for
  the zone; and
               (5)  contain findings that promotion of the
  transportation project will cultivate development or redevelopment
  of the zone.
         (h)  From taxes collected on property in a zone, the
  municipality shall pay into the tax increment account for the zone
  an amount equal to the tax increment produced by the municipality.
         (i)  Money deposited to a tax increment account must be used
  to fund projects authorized under Section 222.104, including the
  repayment of amounts owed under an agreement entered into under
  that section.
         (j)  Except as provided by Subsection (k), a transportation
  reinvestment zone terminates on December 31 of the year in which the
  municipality complies with a contractual requirement, if any, that
  included the pledge of money deposited to a tax increment account or
  the repayment of money owed under the agreement under Section
  222.104 in connection with which the zone was designated.
         (k)  A transportation reinvestment zone terminates on
  December 31 of the 10th year after the year the zone was designated,
  if before that date the municipality has not used the zone for the
  purpose for which it was designated.
         (l)  Any surplus remaining on termination of a zone may be
  used for transportation projects of the municipality in or outside
  of the zone.
         Sec. 222.107.  COUNTY TRANSPORTATION REINVESTMENT ZONES;
  TAX ABATEMENTS; ROAD UTILITY DISTRICTS.  (a)  In this section:
               (1)  the amount of a county's tax increment for a year
  is the amount of ad valorem taxes levied and collected by the county
  for that year on the captured appraised value of real property
  taxable by the county and located in a transportation reinvestment
  zone under this section;
               (2)  the captured appraised value of real property
  taxable by a county for a year is the total appraised value of all
  real property taxable by the county and located in a transportation
  reinvestment zone for that year less the tax increment base of the
  county; and
               (3)  the tax increment base of a county is the total
  appraised value of all real property taxable by the county and
  located in a transportation reinvestment zone for the year in which
  the zone was designated under this section.
         (b)  This section applies only to a county the commissioners
  court of which intends to enter into a pass-through toll agreement
  with the department under Section 222.104.
         (c)  The commissioners court of the county, after
  determining that an area is unproductive and underdeveloped and
  that action under this section would further the purposes described
  by Section 222.105, by order or resolution may designate a
  contiguous geographic area in the jurisdiction of the county to be a
  transportation reinvestment zone to promote a transportation
  project described by Section 222.104 that cultivates development or
  redevelopment of the area and for the purpose of abating ad valorem
  taxes imposed by the county on real property located in the zone.
         (d)  The commissioners court must comply with all applicable
  laws in the application of this chapter.
         (e)  Not later than the 30th day before the date the
  commissioners court proposes to designate an area as a
  transportation reinvestment zone under this section, the
  commissioners court must hold a public hearing on the creation of
  the zone, its benefits to the county and to property in the proposed
  zone, and the abatement of ad valorem taxes imposed by the county on
  real property located in the zone.  At the hearing an interested
  person may speak for or against the designation of the zone, its
  boundaries, or the abatement of county taxes on real property in the
  zone.  Not later than the seventh day before the date of the
  hearing, notice of the hearing and the intent to create a zone must
  be published in a newspaper having general circulation in the
  county.
         (f)  The order or resolution designating an area as a
  transportation reinvestment zone must:
               (1)  describe the boundaries of the zone with
  sufficient definiteness to identify with ordinary and reasonable
  certainty the territory included in the zone;
               (2)  provide that the zone takes effect immediately on
  adoption of the order or resolution; and
               (3)  assign a name to the zone for identification, with
  the first zone designated by a county designated as "Transportation
  Reinvestment Zone Number One, County of (name of county)," and
  subsequently designated zones assigned names in the same form
  numbered consecutively in the order of their designation.
         (g)  Compliance with the requirements of this section
  constitutes designation of an area as a transportation reinvestment
  zone without further hearings or other procedural requirements.
         (h)  The commissioners court by order or resolution may enter
  into an agreement with the owner of any real property located in the
  transportation reinvestment zone to abate a portion of the ad
  valorem taxes imposed by the county on the owner's property. All
  abatements granted by the commissioners court in a transportation
  reinvestment zone must be equal in rate.  In the alternative, the
  commissioners court by order or resolution may elect to abate a
  portion of the ad valorem taxes imposed by the county on all real
  property located in the zone.  In any ad valorem tax year, the total
  amount of the taxes abated under this section may not exceed the
  amount calculated under Subsection (a)(1) for that year.
         (i)  To assist the county in developing a project authorized
  under Section 222.104, if authorized by the commission under
  Chapter 441, a road utility district may be formed under that
  chapter that has the same boundaries as a transportation
  reinvestment zone created under this section.
         (j)  In any ad valorem tax year, a road utility district
  formed as provided by Subsection (i) may impose taxes on property in
  the district at a rate that when applied to the property in the
  district would impose taxes in an amount equal to the amount of
  taxes abated by the commissioners court of the county under
  Subsection (h). Notwithstanding Section 441.192(a), an election is
  not required to approve the imposition of the taxes.
         (k)  A road utility district formed as provided by Subsection
  (i) may enter into an agreement with the county to assume the
  obligation, if any, of the county to fund a project under Section
  222.104 or to repay funds owed to the department under Section
  222.104.  Any amount paid for this purpose is considered to be an
  operating expense of the district. Any taxes collected by the
  district that are not paid for this purpose may be used for any
  district purpose.
         (l)  Except as provided by Subsection (m), a tax abatement
  agreement entered into under Subsection (h), or an order or
  resolution on the abatement of taxes under that subsection,
  terminates on December 31 of the year in which the county completes
  any contractual requirement that included the pledge of money
  collected under this section.
         (m)  A transportation reinvestment zone terminates on
  December 31 of the 10th year after the year the zone was designated,
  if before that date the county has not used the zone for the purpose
  for which it was designated.
         SECTION 3.  This Act takes effect September 1, 2007.
 
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 1266 passed the Senate on
  April 12, 2007, by the following vote:  Yeas 31, Nays 0;
  May 25, 2007, Senate refused to concur in House amendments and
  requested appointment of Conference Committee; May 26, 2007, House
  granted request of the Senate; May 26, 2007, Senate adopted
  Conference Committee Report by the following vote:  Yeas 30,
  Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 1266 passed the House, with
  amendments, on May 16, 2007, by the following vote:  Yeas 141,
  Nays 0, two present not voting; May 26, 2007, House granted request
  of the Senate for appointment of Conference Committee;
  May 27, 2007, House adopted Conference Committee Report by the
  following vote:  Yeas 142, Nays 1, two present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
             Date
 
 
  ______________________________ 
            Governor