Bill Text: TX HB2467 | 2013-2014 | 83rd Legislature | Introduced
Bill Title: Relating to the Texas Economic Development Act; authorizing a fee.
Spectrum: Partisan Bill (Republican 3-0)
Status: (Introduced - Dead) 2013-04-09 - Left pending in committee [HB2467 Detail]
Download: Texas-2013-HB2467-Introduced.html
83R3007 SMH-F | ||
By: Murphy | H.B. No. 2467 |
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relating to the Texas Economic Development Act; authorizing a fee. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Sections 313.002, 313.004, and 313.007, Tax | ||
Code, are amended to read as follows: | ||
Sec. 313.002. FINDINGS. The legislature finds that: | ||
(1) many states have enacted aggressive economic | ||
development laws designed to attract large employers, create jobs, | ||
and strengthen their economies; | ||
(2) given Texas' relatively high property taxes, it is | ||
difficult for the state to compete for new capital projects without | ||
some kind of temporary limit on ad valorem taxes imposed on new | ||
capital investments [ |
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(3) a significant portion of the Texas economy | ||
continues to be based in [ |
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capital-intensive industries [ |
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growth and overall health [ |
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Texas economy well; | ||
(4) without a vibrant, strong manufacturing sector, | ||
other sectors of the economy, especially the state's service | ||
sector, will also suffer adverse consequences; and | ||
(5) the current property tax system of this state does | ||
not favor capital-intensive businesses such as manufacturers. | ||
Sec. 313.004. LEGISLATIVE INTENT. It is the intent of the | ||
legislature in enacting this chapter that: | ||
(1) economic development decisions should occur at the | ||
local level and be consistent with identifiable statewide economic | ||
development goals; | ||
(2) this chapter should not be construed or | ||
interpreted to allow: | ||
(A) property owners to pool investments to create | ||
sufficiently large investments to qualify for an ad valorem tax | ||
benefit or financial benefit provided by this chapter; | ||
(B) an applicant for an ad valorem tax benefit or | ||
financial benefit provided by this chapter to assert that jobs will | ||
be eliminated if certain investments are not made if the assertion | ||
is not true; or | ||
(C) an entity not subject to the franchise tax | ||
imposed by Chapter 171 because of its form of business [ |
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receive an ad valorem tax benefit or financial benefit provided by | ||
this chapter; and | ||
(3) in implementing this chapter, school districts | ||
should: | ||
(A) strictly interpret the criteria and | ||
selection guidelines provided by this chapter; and | ||
(B) approve only those applications for an ad | ||
valorem tax benefit or financial benefit provided by this chapter | ||
that: | ||
(i) enhance the local community; | ||
(ii) improve the local public education | ||
system; | ||
(iii) create high-paying jobs; and | ||
(iv) advance the economic development goals | ||
of this state as identified by the Texas Strategic Economic | ||
Development Planning Commission or its successor. | ||
Sec. 313.007. EXPIRATION. Subchapters B and [ |
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expire December 31, 2024 [ |
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SECTION 2. Section 313.021, Tax Code, is amended by | ||
amending Subdivisions (1) and (3) and adding Subdivisions (6) and | ||
(7) to read as follows: | ||
(1) "Qualified investment" means: | ||
(A) tangible personal property that is first | ||
placed in service in this state during the applicable qualifying | ||
time period that begins on or after January 1, 2002, without regard | ||
to whether the property is affixed to or incorporated into real | ||
property, and that is described as Section 1245 property by Section | ||
1245(a), Internal Revenue Code of 1986; | ||
(B) tangible personal property that is first | ||
placed in service in this state during the applicable qualifying | ||
time period that begins on or after January 1, 2002, without regard | ||
to whether the property is affixed to or incorporated into real | ||
property, and that is used in connection with the manufacturing, | ||
processing, or fabrication in a cleanroom environment of a | ||
semiconductor product, without regard to whether the property is | ||
actually located in the cleanroom environment, including: | ||
(i) integrated systems, fixtures, and | ||
piping; | ||
(ii) all property necessary or adapted to | ||
reduce contamination or to control airflow, temperature, humidity, | ||
chemical purity, or other environmental conditions or | ||
manufacturing tolerances; and | ||
(iii) production equipment and machinery, | ||
moveable cleanroom partitions, and cleanroom lighting; | ||
(C) tangible personal property that is first | ||
placed in service in this state during the applicable qualifying | ||
time period that begins on or after January 1, 2002, without regard | ||
to whether the property is affixed to or incorporated into real | ||
property, and that is used in connection with the operation of a | ||
nuclear electric power generation facility, including: | ||
(i) property, including pressure vessels, | ||
pumps, turbines, generators, and condensers, used to produce | ||
nuclear electric power; and | ||
(ii) property and systems necessary to | ||
control radioactive contamination; | ||
(D) tangible personal property that is first | ||
placed in service in this state during the applicable qualifying | ||
time period that begins on or after January 1, 2002, without regard | ||
to whether the property is affixed to or incorporated into real | ||
property, and that is used in connection with operating an | ||
integrated gasification combined cycle electric generation | ||
facility, including: | ||
(i) property used to produce electric power | ||
by means of a combined combustion turbine and steam turbine | ||
application using synthetic gas or another product produced by the | ||
gasification of coal or another carbon-based feedstock; or | ||
(ii) property used in handling materials to | ||
be used as feedstock for gasification or used in the gasification | ||
process to produce synthetic gas or another carbon-based feedstock | ||
for use in the production of electric power in the manner described | ||
by Subparagraph (i); | ||
(E) tangible personal property that is first | ||
placed in service in this state during the applicable qualifying | ||
time period that begins on or after January 1, 2010, without regard | ||
to whether the property is affixed to or incorporated into real | ||
property, and that is used in connection with operating an advanced | ||
clean energy project, as defined by Section 382.003, Health and | ||
Safety Code; [ |
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(F) a building or a permanent, nonremovable | ||
component of a building that is built or constructed during the | ||
applicable qualifying time period that begins on or after January | ||
1, 2002, and that houses tangible personal property described by | ||
Paragraph (A), (B), (C), (D), or (E); or | ||
(G) a building or a permanent, nonremovable | ||
component of a building that, as part of a discrete project that | ||
increases the value of the building or component, is renovated, | ||
expanded, or otherwise improved during the applicable qualifying | ||
time period that begins on or after January 1, 2014, and that houses | ||
tangible personal property described by Paragraph (A), (B), (C), | ||
(D), or (E). | ||
(3) "Qualifying job" means a permanent full-time job | ||
that: | ||
(A) requires at least 1,600 hours of work a year; | ||
(B) is not transferred from one area in this | ||
state to another area in this state; | ||
(C) is not created to replace a previous | ||
employee; | ||
(D) is covered by a group health benefit plan | ||
that complies with the Patient Protection and Affordable Care Act | ||
(Pub. L. No. 111-148) as amended by the Health Care and Education | ||
Reconciliation Act of 2010 (Pub. L. No. 111-152) [ |
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(E) pays at least 110 percent of: | ||
(i) the county average weekly wage for | ||
manufacturing jobs in the county where the job is located; or | ||
(ii) the county average weekly wage for all | ||
jobs in the county where the job is located, if the property owner | ||
creates more than 1,000 jobs in that county. | ||
(6) "Strategic investment area" means an area the | ||
comptroller determines under Section 313.051 is: | ||
(A) a county within this state with above average | ||
unemployment and below average per capita income; | ||
(B) an area within this state that is a federally | ||
designated urban enterprise community or an urban enhanced | ||
enterprise community; or | ||
(C) a defense economic readjustment zone | ||
designated under Chapter 2310, Government Code. | ||
(7) "Texas priority project" means a project on which | ||
the applicant has committed to expend or allocate a qualified | ||
investment of more than $1 billion and that the governor has | ||
certified in a letter provided to the applicant is in the best | ||
interest of the economy. | ||
SECTION 3. Sections 313.024(a) and (b), Tax Code, are | ||
amended to read as follows: | ||
(a) This subchapter and Subchapter [ |
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apply only to property owned by an entity to which Chapter 171 | ||
applies. | ||
(b) To be eligible for a limitation on appraised value under | ||
this subchapter, the entity must use the property for [ |
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(1) manufacturing; | ||
(2) research and development; | ||
(3) a clean coal project, as defined by Section 5.001, | ||
Water Code; | ||
(4) an advanced clean energy project, as defined by | ||
Section 382.003, Health and Safety Code; | ||
(5) renewable energy electric generation; | ||
(6) electric power generation using integrated | ||
gasification combined cycle technology; | ||
(7) nuclear electric power generation; [ |
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(8) a data [ |
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(9) a Texas priority project [ |
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SECTION 4. Section 313.024(e)(6), Tax Code, is amended to | ||
read as follows: | ||
(6) "Data [ |
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primarily engaged in: | ||
(A) data processing, hosting, and related | ||
services described by industry code 518210 of the North American | ||
Industry Classification System; | ||
(B) an Internet activity described by industry | ||
code 519130 of the North American Industry Classification System; | ||
or | ||
(C) computer software publishing and | ||
reproduction described by industry code 511210 of the North | ||
American Industry Classification System [ |
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SECTION 5. Section 313.025(b-1), Tax Code, is amended to | ||
read as follows: | ||
(b-1) The comptroller shall indicate on one copy of the | ||
application the date the comptroller received the application and | ||
deliver that copy to the Texas Education Agency. The Texas | ||
Education Agency shall determine the effect that the applicant's | ||
proposal will have on the number or size of the school district's | ||
instructional facilities, as required to be included in the | ||
economic impact evaluation by Section 313.026(a)(11) | ||
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agency's determination to the comptroller. The governing body of | ||
the school district shall provide any requested information to the | ||
Texas Education Agency. Not later than the 45th day after the date | ||
the application indicates that the comptroller received the | ||
application, the Texas Education Agency shall make the required | ||
determination and submit the agency's written report to the | ||
comptroller. A third person contracted by the comptroller to | ||
conduct an economic impact evaluation of an application is not | ||
required to make a determination that the Texas Education Agency is | ||
required to make and report to the comptroller under this | ||
subsection. | ||
SECTION 6. Section 313.026, Tax Code, is amended to read as | ||
follows: | ||
Sec. 313.026. ECONOMIC IMPACT EVALUATION. (a) The | ||
economic impact evaluation of the application must include the | ||
following: | ||
(1) the recommendations of the comptroller; | ||
(2) the name of the school district; | ||
(3) the name of the applicant; | ||
(4) a description of the general nature of the | ||
applicant's investment; | ||
(5) [ |
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[ |
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intended investment [ |
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(6) [ |
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operations jobs to be created by the applicant; | ||
(7) [ |
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offered by the applicant to qualifying job holders; | ||
(8) [ |
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relocate in another state or another region of this state; | ||
(9) [ |
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this state and individual local units of government, including: | ||
(A) tax and other revenue gains, direct and | ||
otherwise [ |
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qualifying time period, the limitation period, and a period of time | ||
after the limitation period considered appropriate by the | ||
comptroller; and | ||
(B) economic effects of the project, including | ||
the impact on jobs and income, direct and otherwise, during the | ||
qualifying time period, the limitation period, and a period of time | ||
after the limitation period considered appropriate by the | ||
comptroller; | ||
(10) [ |
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the state at the time the person's application is being considered; | ||
(11) [ |
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approved, on the number or size of the school district's | ||
instructional facilities, as defined by Section 46.001, Education | ||
Code; | ||
(12) [ |
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Program of payments to the district for each year of the agreement; | ||
and | ||
(13) the other states, if any, in which the applicant | ||
is considering locating the project [ |
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(b) The comptroller's recommendations shall be based on the | ||
criteria listed in Subsection (a) [ |
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any other information available to the comptroller, including | ||
information provided by the governing body of the school district | ||
under Section 313.025(b). | ||
SECTION 7. Section 313.0265(b), Tax Code, is amended to | ||
read as follows: | ||
(b) The comptroller shall designate the following as | ||
substantive: | ||
(1) each application requesting a limitation on | ||
appraised value; and | ||
(2) the economic impact evaluation made in connection | ||
with the application[ |
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SECTION 8. Sections 313.027(a), (h), and (i), Tax Code, are | ||
amended to read as follows: | ||
(a) If the person's application is approved by the governing | ||
body of the school district, for each of the first 10 [ |
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years that begin after the applicable qualifying time period, the | ||
appraised value for school district maintenance and operations ad | ||
valorem tax purposes of the person's qualified property as | ||
described in the agreement between the person and the district | ||
entered into under this section in the school district may not | ||
exceed the lesser of: | ||
(1) the market value of the property; or | ||
(2) subject to Subsection (b), the amount agreed to by | ||
the governing body of the school district. | ||
(h) The agreement between the governing body of the school | ||
district and the applicant may provide for a deferral of the date on | ||
which the qualifying time period for the project is to commence or, | ||
subsequent to the date the agreement is entered into, be amended to | ||
provide for such a deferral. The agreement may not provide for the | ||
deferral of the date on which the qualifying time period is to | ||
commence to a date later than January 1 of the fourth tax year | ||
beginning after the date the application is approved. This | ||
subsection may not be construed to permit a qualifying time period | ||
that has commenced to continue for more than the number of years | ||
applicable to the project under Section 313.021(4). | ||
(i) A person and the school district may not enter into an | ||
agreement if in conjunction with the agreement any payments or | ||
other benefits are to be provided by or on behalf of the person in | ||
recognition or anticipation of, or in consideration for, the | ||
district entering into the agreement, other than payments or | ||
benefits authorized under Subsection (f)(1) or (2) [ |
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SECTION 9. Section 313.0275, Tax Code, is amended by adding | ||
Subsection (d) to read as follows: | ||
(d) In the event of a casualty loss that prevents a person | ||
from complying with Subsection (a), the person may request and the | ||
comptroller may grant a waiver of the penalty imposed under | ||
Subsection (b). | ||
SECTION 10. Section 313.031, Tax Code, is amended by | ||
amending Subsection (a) and adding Subsection (a-1) to read as | ||
follows: | ||
(a) The comptroller shall: | ||
(1) adopt rules and forms necessary for the | ||
implementation and administration of this chapter, including rules | ||
for determining whether a property owner's property qualifies as a | ||
qualified investment under Section 313.021(1); and | ||
(2) provide without charge one copy of the rules and | ||
forms to any school district and to any person who states that the | ||
person intends to apply for a limitation on appraised value under | ||
this subchapter [ |
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(a-1) The comptroller by official action may establish | ||
reasonable nonrefundable fees to be paid by property owners who | ||
apply to a school district for a limitation on the value of the | ||
person's property under this subchapter. The amount of a fee must | ||
be reasonable and may not exceed the estimated cost to the | ||
comptroller of preparing the report required by Section 313.032. | ||
SECTION 11. Section 313.032, Tax Code, is amended by | ||
amending Subsections (a) and (c) and adding Subsection (b-1) to | ||
read as follows: | ||
(a) Before the beginning of each regular session of the | ||
legislature, the comptroller shall submit to the lieutenant | ||
governor, the speaker of the house of representatives, and each | ||
other member of the legislature a report on the agreements entered | ||
into under this chapter that includes: | ||
(1) an assessment of the following with regard to the | ||
agreements entered into under this chapter, considered in the | ||
aggregate: | ||
(A) the total number of jobs created, direct and | ||
otherwise, in this state; | ||
(B) the total effect on personal income, direct | ||
and otherwise, in this state; | ||
(C) the effect, direct and otherwise, on the | ||
total amount of investment in this state; | ||
(D) the effect, direct and otherwise, on the | ||
total taxable value of property on the tax rolls in this state, | ||
including property for which the limitation period has expired; | ||
(E) the total value of property not on the tax | ||
rolls in this state as a result of agreements entered into under | ||
this chapter; and | ||
(F) the total fiscal effect, direct and | ||
otherwise, on the state and local governments; and | ||
(2) an assessment of [ |
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agreement made under this chapter that states[ |
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each agreement: | ||
(A) [ |
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each recipient of a limitation on appraised value committed to | ||
create; | ||
(B) [ |
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each recipient created; | ||
(C) [ |
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of the new jobs each recipient created; | ||
(D) [ |
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each recipient committed to spend or allocate for each project; | ||
(E) [ |
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investment each recipient spent or allocated for each project; | ||
(F) [ |
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property of each recipient as determined by the applicable chief | ||
appraiser, including property that is no longer eligible for a | ||
limitation on appraised value under the agreement; | ||
(G) [ |
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the qualified property of each recipient; and | ||
(H) [ |
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qualified property[ |
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(b-1) In preparing the portion of the report described by | ||
Subsection (a)(1), the comptroller may use standard economic | ||
estimation techniques, including economic multipliers. | ||
(c) The portion of the report described by Subsection (a)(2) | ||
must be based on data certified to the comptroller by each recipient | ||
of a limitation on appraised value under this chapter. The | ||
comptroller may require a recipient to submit, on a form the | ||
comptroller provides, information required to complete the portion | ||
of the report described by that subdivision. | ||
SECTION 12. Section 313.051, Tax Code, is amended by | ||
amending Subsection (a) and adding Subsections (a-2), (a-3), and | ||
(a-4) to read as follows: | ||
(a) This subchapter applies only to a school district that | ||
has territory in: | ||
(1) an area that qualifies [ |
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investment area [ |
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(2) a county: | ||
(A) that has a population of less than 50,000; | ||
and | ||
(B) in which, [ |
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the most recent federal decennial census as compared to the | ||
preceding census, the population: | ||
(i) remained the same; | ||
(ii) decreased; or | ||
(iii) increased, but at a rate of not more | ||
than three percent per annum. | ||
(a-2) Not later than September 1 of each year, the | ||
comptroller shall determine areas that qualify as a strategic | ||
investment area using the most recently completed full calendar | ||
year data available on that date and, not later than October 1, | ||
shall publish a list and map of the designated areas. | ||
(a-3) A determination under Subsection (a-2) is effective | ||
for the following tax year for purposes of this subchapter. | ||
(a-4) Notwithstanding Subsection (a)(1), a person who | ||
enters into an agreement with a school district to which Subsection | ||
(a)(1) applied at the time the person and the school district | ||
entered into the agreement is eligible to receive a limitation on | ||
appraised value under this subchapter in accordance with the terms | ||
of the agreement regardless of whether the district ceases to be | ||
described by Subsection (a)(1) after the date the person and the | ||
district entered into the agreement. | ||
SECTION 13. The heading to Subchapter E, Chapter 313, Tax | ||
Code, is amended to read as follows: | ||
SUBCHAPTER E. AVAILABILITY OF TAX CREDIT AFTER PROGRAM EXPIRES OR | ||
IS REPEALED | ||
SECTION 14. Section 313.171(b), Tax Code, is amended to | ||
read as follows: | ||
(b) The repeal [ |
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a property owner's entitlement to a tax credit granted under | ||
Subchapter D if the property owner qualified for the tax credit | ||
before the repeal [ |
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SECTION 15. Section 42.2515(a), Education Code, is amended | ||
to read as follows: | ||
(a) For each school year, a school district, including a | ||
school district that is otherwise ineligible for state aid under | ||
this chapter, is entitled to state aid in an amount equal to the | ||
amount of all tax credits credited against ad valorem taxes of the | ||
district in that year under former Subchapter D, Chapter 313, Tax | ||
Code. | ||
SECTION 16. Section 42.302(e), Education Code, is amended | ||
to read as follows: | ||
(e) For purposes of this section, school district taxes for | ||
which credit is granted under former Subchapter D, Chapter 313, Tax | ||
Code, are considered taxes collected by the school district as if | ||
the taxes were paid when the credit for the taxes was granted. | ||
SECTION 17. The following provisions of the Tax Code are | ||
repealed: | ||
(1) Sections 313.008 and 313.009; and | ||
(2) Subchapter D, Chapter 313. | ||
SECTION 18. Chapter 313, Tax Code, as amended by this Act, | ||
applies only to an application filed under that chapter on or after | ||
the effective date of this Act. An application filed under that | ||
chapter before the effective date of this Act is governed by the law | ||
in effect on the date the application was filed, and the former law | ||
is continued in effect for that purpose. | ||
SECTION 19. The comptroller shall make the initial | ||
determination under Section 313.051(a-2), Tax Code, as added by | ||
this Act, not later than September 1, 2014, and shall publish the | ||
initial list and map required by that subsection not later than | ||
October 1, 2014. | ||
SECTION 20. This Act takes effect September 1, 2013. |