HBA-NMO H.B. 3796 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3796 By: Hartnett Natural Resources 4/12/1999 Introduced BACKGROUND AND PURPOSE Current law authorizes the Dallas County Utility and Reclamation District (district), located completely within the City of Irving, to enter into tax abatement agreements for up to thirty years. The district's tax abatement process may need amending for the purposes of standardization and the avoidance of inconsistency with future tax abatements. H.B. 3796 limits the abatement term to a maximum of 25 years and a minimum of 20 years, and sets the effective district tax rate at $0.50 for commercial property and $0.60 for residential property, among several other changes. 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 4B(5), Chapter 628, Acts of the 68th Legislature, Regular Session, 1983, as follows: (5) Requires, rather than authorizes, the Dallas Utility and Reclamation District (district) to enter into tax abatement agreements for periods not to exceed 25, rather than 30, years as further limited under a specified term schedule. Requires that tax abatement agreements be subject to the rights of holders of current and subsequently issued outstanding tax-supported bonds, despite date of issuance, and credit providers of the district. Requires that the effective tax rate in the Tax Abatement and Development Agreement, as that term is defined in the tax abatement policy guidelines and criteria of the district, be for residential land use, $.60 per hundred dollars of assessed eligible property value; and for nonresidential land use, $.50 per hundred dollars of assessed eligible property value. Requires that the Tax Abatement and Development Agreement be with owners of real and personal property within the district for a proposed project or projects. Requires that the district's definition of project be incorporated into the Tax Abatement and Development Agreement. Provides that the form and substance of the district's tax abatement agreement approved by the district's board of directors, up to this point, and identified as "Generic Tax Abatement Agreement" is approved, ratified and validated. Requires that the tax abatement project and agreement be consistent with the district's tax abatement policy guidelines and the requirements of the deed restrictions enforced by the Las Colinas Association, or equivalent restrictions, enforced by the district, as the sole criteria for the project. Authorizes that the tax abatement agreements include phased projects. Provides that the tax abatement agreements do not have to be identical within the same reinvestment zone. Authorizes that the tax abatement agreements incorporate district's requirements relative to infrastructure and provides that the tax abate agreements are valid for a period not to exceed 25 years. Requires that the provisions of this Act prevail over any inconsistent provision in chapter 312 (Property Redevelopment and Tax Abatement Act) of the Tax Code. SECTION 2. Amends Section 4B, Chapter 628, Acts of the 68th Legislative, Regular Session, by adding new subdivisions (8), (9), (10), and (11), as follows: (8) Provides that policy guidelines and criteria adopted by the district are effective during the effective dates of all tax abatement agreements entered into by the district. Authorizes the amendment of the policy guidelines and criteria from time to time by a vote of the governing body. (9) Provides that the designation of a reinvestment zone for residential or commercialindustrial Tax Abatement purposes stays in effect for 25 years or until the termination of all outstanding tax abatement agreements whichever occurs last. (10) Provides that the tax abatement agreements entered into within the same reinvestment zone are not required to be identical. (11) Authorizes that a tax abatement agreement describe the kind, number, and location of all proposed improvements in a general manner subject to change at such time as the specifics of the project are quantified pursuant to the submission of a notice of intent to the district regarding the construction of the project. SECTION 3. Provides legislative intent. SECTION 4. Provides legislative findings. SECTION 5. Validates, ratifies, and confirms from this point the organization of the district and all elections held, all contracts executed, and all bonds and other obligations issued by the district; and the expenditure of funds in payment or satisfaction of bonds, all sales and donations of assets, tax rate reduction agreements, and all governmental and proprietary actions. Authorizes the issuance, levy, and collection of all bonds voted and all maintenance taxes authorized at elections held within the district by the board of directors of the district without the necessity of any further elections. SECTION 6. Severability clause. SECTION 7. Emergency clause. Effective date: 90 days after passage.