HBA-KDB H.B. 1100 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 1100 By: Lewis, Ron Ways & Means 6/5/2001 Enrolled BACKGROUND AND PURPOSE Prior to the 77th Legislature, vessels and other watercraft constructed in Texas but used outside of the state were subject to ad valorem taxation even though such property was in this state on a temporary basis. Such a property tax might have convinced shipbuilders to construct their vessels elsewhere, which could have placed jobs associated with shipbuilding at risk. House Bill 1100 provides that vessels and other watercraft that are constructed in but used outside of this state are not subject to ad valorem taxation. 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. ANALYSIS House Bill1100 amends the Tax Code to provide that a commercially-used or noncommercially-used vessel or other watercraft that is used outside of this state and is in this state solely to be constructed or converted, in addition to being repaired, stored, or inspected is presumed to be interstate, international, or foreign commerce and not located in this state for longer than a temporary period and is not taxed as real personal property. Tangible personal property in this state is presumed to be in interstate, international, or foreign commerce and not located in this state for longer than a temporary period and is not taxed as tangible personal property because of its temporary status if the owner demonstrates to the chief appraiser that the owner intends to incorporate the property in or attach the property to an identified vessel or other watercraft that is to be converted, repaired, stored, inspected, or under construction. EFFECTIVE DATE January 1, 2002.