HBA-JLV S.B. 986 77(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 986
By: Duncan
Ways & Means
5/7/2001
Engrossed



BACKGROUND AND PURPOSE 

Currently, Texas cities provide financial incentives by way of tax
abatement agreements for the purpose of job creation in their communities.
However, a city has no recourse when the requisite job creation is not
fulfilled.  Senate Bill 986 gives cities the statutory authority to
recapture lost property tax revenue if the owner of the commercial
enterprise fails to create the number of new jobs required by the agreement
or the property value does not increase as expected under the agreement.  

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

Senate Bill 986 amends the Tax Code to provide that certain tax abatement
agreements may include, at the option of the governing body of the
municipality, provisions for the recapture of all or a portion of property
tax revenue lost as a result of the agreement if the owner of the property
fails to create all or a portion of the number of new jobs provided by the
agreement or if the appraised value of the property subject to the
agreement does not attain a value specified in the agreement, and payment
of a penalty, interest, or both, on that recaptured property tax revenue.  

EFFECTIVE DATE

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001.