HBA-JRA H.B. 3246 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 3246
By: Allen
Ways & Means
4/7/1999
Introduced



BACKGROUND AND PURPOSE 

The purpose of H.B. 3246 is to clarify the process of appraisal of heavy
equipment for the purposes of ad valorem taxation.  H.B. 3246 provides that
heavy equipment that is leased but subject to a purchase option by the
lessee is subject to property tax as part of a dealer's inventory. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 23.1241(a)(2), Tax Code, to provide that the
term "dealer's heavy equipment inventory" includes items of heavy equipment
that are leased but subject to a purchase option by the lessee. 

SECTION 2.  Amends Section 23.1241(b), Tax Code, to provide that, for the
purpose of the computation of property tax, a sale is considered to occur
when ownership of an item of heavy equipment is transferred from the dealer
to the purchaser.  Makes conforming changes. 

SECTION 3.  Effective date:  January 1, 2000.
Makes application of this Act prospective to a tax year that begins on or
after that date. 

SECTION 4.  Emergency clause.