Bill Text: TX SB1698 | 2021-2022 | 87th Legislature | Introduced

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Bill Title: Relating to a franchise or insurance premium tax credit for contributions made to certain educational assistance organizations.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Introduced - Dead) 2021-03-26 - Referred to Education [SB1698 Detail]

Download: Texas-2021-SB1698-Introduced.html

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87R9066 BEF-F
By: Paxton S.B. No. 1698

A BILL TO BE ENTITLED
AN ACT
relating to a franchise or insurance premium tax credit for
contributions made to certain educational assistance
organizations.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 171, Tax Code, is amended by adding
Subchapter N to read as follows:
SUBCHAPTER N. TAX CREDIT FOR CONTRIBUTIONS TO CERTAIN EDUCATIONAL
ASSISTANCE ORGANIZATIONS
Sec. 171.701. DEFINITION. In this subchapter, "educational
assistance organization" means an organization that:
(1) has the ability according to the organization's
charter to award scholarships to or pay educational expenses for
eligible students in:
(A) public elementary or secondary schools
located in this state; or
(B) nonpublic elementary or secondary schools
located in this state:
(i) that meet the requirements of Section
171.704;
(ii) at which a student may fulfill this
state's compulsory attendance requirements; and
(iii) that are not in violation of the
federal Civil Rights Act of 1964 (42 U.S.C. Section 2000a et seq.);
and
(2) uses part of its annual revenue for the purpose
provided by Subdivision (1).
Sec. 171.702. ELIGIBILITY REQUIREMENTS FOR CERTIFICATION
OF EDUCATIONAL ASSISTANCE ORGANIZATION. (a) An organization may
apply to the comptroller for certification as a certified
educational assistance organization.
(b) To be eligible for certification, an organization:
(1) must:
(A) be exempt from federal tax under Section
501(a) of the Internal Revenue Code by being listed as an exempt
organization in Section 501(c)(3) of that code;
(B) be in good standing with the state;
(C) be located in the state;
(D) agree to allocate at least 90 percent of its
annual revenue from contributions that are designated for
scholarships or educational expense assistance for eligible
students under this subchapter for student scholarships and
assistance for educational expenses, including tuition,
transportation, textbooks, and other supplies, and for other
related educational expense assistance as described by this
section;
(E) agree to award scholarships and assistance
for qualifying educational expenses to eligible students who
demonstrate the greatest financial and academic need;
(F) agree to provide each donor a receipt for
money contributed to the organization that includes the name of the
organization, the name of the donor, the amount of the
contribution, the information required by Section 171.707(c), and
any other information required by the comptroller;
(G) demonstrate experience and technical
expertise in:
(i) accepting, processing, and tracking
applications for scholarships or educational expense assistance;
and
(ii) awarding scholarships to students in
primary or secondary schools;
(H) agree to be independently audited on an
annual basis and file the audit with the comptroller; and
(I) agree to disburse within two academic years
of receipt contributions received from and designated by entities
for scholarships or educational expense assistance under this
subchapter; and
(2) may not:
(A) award all scholarships under this subchapter
to students who attend a particular school or pay educational
expenses incurred only at a particular school;
(B) provide to a student a scholarship in an
annual amount that exceeds the amount provided under Section
171.708(a) or (b) unless the money used to provide the portion of
the scholarship in excess of that amount was contributed by a person
other than an entity that provides notice under Section 171.707(c)
that the entity may apply for a tax credit for the contribution; and
(C) provide to a student educational expense
assistance in excess of the amount provided under Section
171.708(c), unless the money used to provide the portion of the
assistance in excess of that amount was contributed by a person
other than an entity that provides notice under Section 171.707(c)
that the entity may apply for a tax credit for the contribution,
including assistance for:
(i) facility fees;
(ii) textbooks;
(iii) school supplies;
(iv) tutoring;
(v) academic after-school programs;
(vi) school or lab fees;
(vii) before-school or after-school child
care; and
(viii) transportation expenses, including
the cost to transfer from one public school to another.
(c) The comptroller may certify not more than 25 certified
educational assistance organizations. The comptroller may certify
as a certified educational assistance organization an organization
that applies under Subsection (a) if the organization meets the
requirements of Subsection (b). The comptroller has broad
discretion in determining whether to grant or deny an application
for certification.
(d) The comptroller shall notify an organization in writing
of the comptroller's decision to grant or deny the application
under Subsection (a). If the comptroller denies an organization's
application, the comptroller shall include in the notice of denial
the reasons for the comptroller's decision.
(e) If the comptroller denies an organization's application
under Subsection (a), the organization may request in writing a
reconsideration of the application not later than the 10th day
after the date the notice under Subsection (d) is received. If the
organization does not request a reconsideration of the application
on or before that date, the comptroller's decision is final. An
organization may not request reconsideration of an application if
the comptroller denied the application because 25 organizations
were already certified as certified educational assistance
organizations.
(f) An organization that requests a reconsideration under
Subsection (e) may submit to the comptroller, not later than the
30th day after the date the request for reconsideration is
submitted, additional information and documents to support the
organization's request for reconsideration.
(g) The comptroller's reconsideration of an application
under this section is not a contested case under Chapter 2001,
Government Code. The comptroller's decision on a request for
reconsideration of an application is final and is not appealable.
(h) This section does not create a cause of action to
contest a decision of the comptroller to deny an application for
certification as a certified educational assistance organization.
Sec. 171.703. ALLOCATION OF MONEY DESIGNATED FOR
SCHOLARSHIPS OR EDUCATIONAL EXPENSE ASSISTANCE. Of the amount
required to be allocated as provided by Section 171.702(b)(1)(D), a
certified educational assistance organization shall use:
(1) at least 80 percent to award scholarships as
described by Sections 171.708(a) and (b); and
(2) not more than 20 percent to award educational
expense assistance as described by Section 171.708(c).
Sec. 171.704. NONPUBLIC SCHOOL REQUIREMENTS. A certified
educational assistance organization may award scholarships to or
pay educational expenses for eligible students enrolled in a
nonpublic school if the nonpublic school executes a notarized
affidavit, with supporting documents, concerning the school's
qualification for scholarships and educational expense assistance
for eligible students who receive assistance from a certified
educational assistance organization, including evidence of:
(1) accreditation or of actively being in the process
of accreditation by the Texas Education Agency or by an
organization recognized by the Texas Private School Accreditation
Commission;
(2) annual administration of a nationally
norm-referenced assessment instrument or the appropriate
assessment instrument required under Section 39.023, Education
Code;
(3) valid certificate of occupancy; and
(4) policy statements regarding:
(A) admissions;
(B) curriculum;
(C) safety;
(D) food service inspection; and
(E) student to teacher ratios.
Sec. 171.705. ELIGIBILITY FOR CREDIT. A taxable entity may
apply for a credit against the tax imposed under this chapter in the
amount and under the conditions provided by this subchapter. The
comptroller shall award credits as provided by Section 171.711.
Sec. 171.706. ELIGIBILITY OF STUDENTS; NOTICE TO CERTAIN
PARENTS; INCLUSION IN AVERAGE DAILY ATTENDANCE. (a) To be eligible
to apply for assistance from a certified educational assistance
organization under this subchapter:
(1) a student:
(A) must:
(i) be in foster care;
(ii) be in institutional care; or
(iii) reside in a household with income not
greater than 250 percent of the income guidelines necessary to
qualify for the national free or reduced-price lunch program
established under 42 U.S.C. Section 1751 et seq.; and
(B) must:
(i) have been enrolled in a public school
during the preceding school year;
(ii) be enrolling in school in this state
for the first time;
(iii) be the sibling of a child who is
eligible to apply under this section; or
(iv) if the student attends a nonpublic
school:
(a) qualify as a student who is not
counted toward a public school's average daily attendance during
the year in which the student receives the scholarship or
educational expense assistance to attend the school, except as
provided by Subsection (f); and
(b) be located in a county with a
population greater than 50,000; or
(2) the student must have previously qualified under
Subdivision (1).
(a-1) Notwithstanding Subsection (a), a school district
located in a county described by that subsection may vote at a
general election to allow students to participate in the tax credit
scholarship program described by this subchapter.
(b) In addition to the students eligible under Subsection
(a), a student is eligible to apply for assistance from a certified
educational assistance organization under this subchapter if the
student:
(1) is in kindergarten through grade 12 and eligible
under Section 29.003, Education Code, to participate in a school
district's special education program; and
(2) has an individualized education program under
Section 29.005, Education Code.
(c) A school district shall provide written notice of the
availability of assistance under this subchapter to the parent of a
student who is eligible to apply for assistance under Subsection
(b). The notice under this subsection must inform the parent that a
qualifying school is not subject to laws regarding the provision of
education services in the same manner as a public school, and a
student with disabilities attending a qualifying school may not
receive the services a student with disabilities attending a public
school is entitled to receive under federal and state law. The
notice must provide information regarding rights a student with
disabilities is entitled to under federal and state law if the
student attends a public school, including:
(1) rights provided under the Individuals with
Disabilities Education Act (20 U.S.C. Section 1400 et seq.),
including:
(A) an individualized education program;
(B) education services provided in the least
restrictive environment;
(C) instruction from certified teachers;
(D) due process hearings to ensure proper and
full implementation of an individualized education program;
(E) transition and planning services; and
(F) supplementary aids and services;
(2) rights provided under Subchapter A, Chapter 29,
Education Code; and
(3) other rights provided under federal or state law
to a student with a disability who attends a public school.
(d) A student who establishes eligibility under Subsection
(b) may continue to receive assistance under this subchapter until
the earlier of the date the student graduates from high school or
the student's 22nd birthday.
(e) A certified educational assistance organization shall
award scholarships and educational expense assistance to eligible
students who apply in accordance with this subchapter.
(f) A student who receives a scholarship under this
subchapter is included in the average daily attendance of the
school district the student would otherwise attend for purposes of
determining if the district's revenue levels exceed the district's
entitlement under Section 48.257, Education Code.
Sec. 171.707. CREDIT FOR CONTRIBUTIONS. (a) A taxable
entity may apply for a credit under this subchapter only for money
contributed to a certified educational assistance organization and
designated for scholarships or educational expense assistance for
eligible students.
(b) A taxable entity may not apply for a credit under this
subchapter for a contribution made to a certified educational
assistance organization if:
(1) the taxable entity requires that the contribution
benefit a particular person or school; or
(2) the contribution is designated to provide a
scholarship or educational expense assistance for a taxable entity
employee or for a spouse or dependent of a taxable entity employee.
(c) An entity shall notify a certified educational
assistance organization in writing when the entity makes a
contribution if the entity may apply for a tax credit under this
subchapter or Chapter 230, Insurance Code, for the contribution. An
entity may not apply for a tax credit for the contribution unless
the entity provides the notice at the time the contribution is made.
The certified educational assistance organization shall indicate
on the receipt provided under Section 171.702(b)(1)(F) that the
entity provided notice under this subsection.
Sec. 171.708. LIMIT ON AMOUNT OF SCHOLARSHIP OR EDUCATIONAL
EXPENSE ASSISTANCE. (a) Except as provided by Subsection (b), the
maximum scholarship amount a certified educational assistance
organization may award to a student under this subchapter using
money contributed by an entity that provides notice under Section
171.707(c) that the entity may apply for a tax credit for the
contribution may not exceed 75 percent of the state average
maintenance and operations expenditures per student in average
daily attendance.
(b) The maximum scholarship amount under Subsection (a) may
not exceed 50 percent of the state average maintenance and
operations expenditures per student in average daily attendance if
the student receiving the scholarship resides in a household with
income greater than 175 percent of the income guidelines necessary
to qualify for the national free or reduced-price lunch program
established under 42 U.S.C. Section 1751 et seq. This subsection
does not apply to a student who is eligible for assistance under
Section 171.706(b) or (d).
(c) The maximum educational expense assistance a certified
educational assistance organization may award to a student under
this subchapter using money contributed by an entity that provides
notice under Section 171.707(c) that the entity may apply for a tax
credit for the contribution may not exceed $500 for the 2022 state
fiscal year, increased by five percent each subsequent year.
Sec. 171.709. AMOUNTS; LIMITATION ON TOTAL CREDITS. (a)
Subject to Subsections (b) and (c), the amount of a taxable entity's
credit is equal to the lesser of the amount of the qualifying
contributions made by the taxable entity during the period covered
by the report or 50 percent of the taxable entity's tax liability
under this chapter for the report.
(b) For the 2022 state fiscal year, the total amount of tax
credits that may be awarded under this subchapter and Chapter 230,
Insurance Code, may not exceed $100 million. For each subsequent
state fiscal year, the total amount of tax credits that may be
awarded is an amount equal to 110 percent of the total amount of tax
credits that may be awarded in the previous state fiscal year.
(c) The comptroller by rule shall prescribe procedures by
which the comptroller may allocate credits under this subchapter.
The procedures must provide that credits are allocated first to
taxable entities that received preliminary approval for a credit
under Section 171.710 and that apply under Section 171.711. The
procedures must provide that any remaining credits are allocated to
taxable entities that apply under Section 171.711 on a first-come,
first-served basis, based on the date the contribution was
initially made.
(d) The comptroller may require a taxable entity to notify
the comptroller of the amount the taxable entity intends or expects
to apply for under this subchapter before the beginning of a state
fiscal year or at any other time required by the comptroller.
Sec. 171.710. PRELIMINARY APPROVAL FOR CREDIT. (a) Before
making a contribution to a certified educational assistance
organization, a taxable entity may apply to the comptroller for
preliminary approval of a credit under this subchapter for the
contribution.
(b) A taxable entity must apply for preliminary approval on
a form provided by the comptroller that includes the amount the
taxable entity expects to contribute and any other information the
comptroller requires.
(c) The comptroller shall grant preliminary approval for
tax credits under this subchapter and Chapter 230, Insurance Code,
on a first-come, first-served basis, based on the date the
comptroller receives the application for preliminary approval.
(d) The comptroller shall grant preliminary approval for a
credit under this subchapter for a state fiscal year if the sum of
the amount of the credit and the total amount of all other credits
preliminarily approved under this subchapter and Chapter 230,
Insurance Code, does not exceed the amount provided by Section
171.709(b).
(e) Final award of credit preliminarily approved under this
section remains subject to the limitations under Section 171.709(a)
and all other requirements of this subchapter.
Sec. 171.711. APPLICATION FOR CREDIT. (a) A taxable entity
must apply for a credit under this subchapter on or with the report
covering the period in which the contribution was made.
(b) The comptroller shall adopt a form for the application
for the credit. A taxable entity must use this form in applying for
the credit and submit with the application form each receipt
provided under Section 171.702(b)(1)(F) that includes the
information required by Section 171.707(c).
(c) Subject to Section 171.709(c), the comptroller may
award a credit to a taxable entity that applies for the credit under
Subsection (a) if the taxable entity is eligible for the credit and
the credit is available under Section 171.709(b). The comptroller
has broad discretion in determining whether to grant or deny an
application for a credit.
(d) The comptroller shall notify a taxable entity in writing
of the comptroller's decision to grant or deny the application
under Subsection (a). If the comptroller denies a taxable entity's
application, the comptroller shall include in the notice of denial
the reasons for the comptroller's decision.
(e) If the comptroller denies a taxable entity's
application under Subsection (a), the taxable entity may request in
writing a reconsideration of the application not later than the
10th day after the date the notice under Subsection (d) is received.
If the taxable entity does not request a reconsideration of the
application on or before that date, the comptroller's decision is
final.
(f) A taxable entity that requests a reconsideration under
Subsection (e) may submit to the comptroller, not later than the
30th day after the date the request for reconsideration is
submitted, additional information and documents to support the
taxable entity's request for reconsideration.
(g) The comptroller's reconsideration of an application
under this section is not a contested case under Chapter 2001,
Government Code. The comptroller's decision on a request for
reconsideration of an application is final and is not appealable.
(h) This section does not create a cause of action to
contest a decision of the comptroller to deny an application for a
credit under this subchapter.
Sec. 171.712. RULES; PROCEDURES. (a) The comptroller
shall adopt rules and procedures to implement, administer, and
enforce this subchapter.
(b) A rule adopted under Subsection (a) is binding on an
organization that applies for certification as an educational
assistance organization, a taxable entity that applies for a
credit, and a state or local governmental entity, including a
political subdivision, as necessary to implement, administer, and
enforce this subchapter.
Sec. 171.713. ASSIGNMENT PROHIBITED; EXCEPTION. A taxable
entity may not convey, assign, or transfer the credit allowed under
this subchapter to another taxable entity unless all assets of the
taxable entity are conveyed, assigned, or transferred in the same
transaction.
Sec. 171.714. REVOCATION. (a) The comptroller shall
revoke a certification provided under Section 171.702 if the
comptroller finds that a certified educational assistance
organization:
(1) is no longer eligible under Section 171.702; or
(2) intentionally and substantially violates this
subchapter.
(b) The comptroller has broad discretion in determining
whether to revoke a certification under Subsection (a).
(c) The comptroller shall notify a certified educational
assistance organization in writing of the comptroller's decision to
revoke the organization's certification. The comptroller shall
include in the notice of revocation the reasons for the proposed
revocation.
(d) If the comptroller notifies a certified educational
assistance organization of the proposed revocation of the
organization's certification, the organization may request in
writing a reconsideration of the proposed revocation not later than
the 10th day after the date the notice under Subsection (c) is
received. If the organization does not request reconsideration on
or before that date, the revocation is final.
(e) An organization that requests a reconsideration under
Subsection (d) may submit to the comptroller, not later than the
30th day after the date the request for reconsideration is
submitted, additional information and documents to support the
organization's request for reconsideration.
(f) The comptroller's reconsideration of a proposed
revocation under this section is not a contested case under Chapter
2001, Government Code. The comptroller's decision on a request for
reconsideration of a proposed revocation is final and is not
appealable.
(g) This section does not create a cause of action to
contest a decision of the comptroller to revoke a certified
educational assistance organization's certification under this
subchapter.
(h) Revocation of a certification under this section does
not affect the validity of a tax credit relating to a contribution
made before the date of revocation.
Sec. 171.715. REPORT OF NET SAVINGS TO PUBLIC EDUCATION.
(a) In this section, "net savings" means any positive difference in
a state fiscal year between:
(1) the amount by which state spending on public
education for that year is reduced as a result of students receiving
scholarships and educational expense assistance from certified
educational assistance organizations under this subchapter; and
(2) the amount by which state revenue derived from
this chapter and Chapter 230, Insurance Code, is reduced as a result
of tax credits under this subchapter and Chapter 230, Insurance
Code.
(b) Not later than December 31 of each even-numbered year,
the comptroller shall determine the amount of net savings for the
previous state fiscal biennium and make available to the public a
report of that amount of savings.
Sec. 171.716. NOTICE OF AVAILABILITY OF CREDIT. The
comptroller shall provide notice of the availability of the credit
under this subchapter on the comptroller's Internet website, in the
instructions for franchise tax report forms, and in any notice sent
to a taxable entity concerning the requirement to file a franchise
tax report.
SECTION 2. Subtitle B, Title 3, Insurance Code, is amended
by adding Chapter 230 to read as follows:
CHAPTER 230. CREDIT AGAINST PREMIUM TAXES FOR CERTAIN
CONTRIBUTIONS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 230.001. DEFINITIONS. In this chapter:
(1) "Educational assistance organization" has the
meaning assigned by Section 171.701, Tax Code.
(2) "State premium tax liability" means any liability
incurred by an entity under Chapters 221 through 226.
SUBCHAPTER B. CREDIT
Sec. 230.051. CREDIT. An entity may apply for a credit
against the entity's state premium tax liability in the amount and
under the conditions provided by this chapter. The comptroller
shall award credits as provided by Section 230.053.
Sec. 230.052. AMOUNTS; LIMITATION ON TOTAL CREDITS. (a)
Subject to Subsections (b) and (c), the amount of an entity's credit
is equal to the lesser of the amount of the qualifying contributions
made to a certified educational assistance organization during the
period covered by the tax report or 50 percent of the entity's state
premium tax liability for the report if the contributions and the
organizations that received the contributions meet the
requirements prescribed by Subchapter N, Chapter 171, Tax Code.
(b) For the 2022 state fiscal year, the total amount of tax
credits that may be awarded under this chapter and Subchapter N,
Chapter 171, Tax Code, may not exceed $100 million. For each
subsequent state fiscal year, the total amount of tax credits that
may be awarded is an amount equal to 110 percent of the total amount
of tax credits that may be awarded in the previous state fiscal
year.
(c) The comptroller by rule shall prescribe procedures by
which the comptroller may allocate credits under this chapter. The
procedures must provide that credits are allocated first to
entities that received preliminary approval for a credit under
Section 230.0525 and that apply under Section 230.053. The
procedures must provide that any remaining credits are allocated to
entities that apply under Section 230.053 on a first-come,
first-served basis, based on the date the contribution was
initially made.
(d) The comptroller may require an entity to notify the
comptroller of the amount the entity intends or expects to apply for
under this chapter before the beginning of a state fiscal year or at
any other time required by the comptroller.
Sec. 230.0525. PRELIMINARY APPROVAL FOR CREDIT. (a) Before
making a contribution to a certified educational assistance
organization, an entity may apply to the comptroller for
preliminary approval of a credit under this chapter for the
contribution.
(b) An entity must apply for preliminary approval on a form
provided by the comptroller that includes the amount the entity
expects to contribute and any other information the comptroller
requires.
(c) The comptroller shall grant preliminary approval for
tax credits under this chapter and Subchapter N, Chapter 171, Tax
Code, on a first-come, first-served basis, based on the date the
comptroller receives the application for preliminary approval.
(d) The comptroller shall grant preliminary approval for a
credit under this chapter for a state fiscal year if the sum of the
amount of the credit and the total amount of all other tax credits
preliminarily approved under this chapter and Subchapter N, Chapter
171, Tax Code, does not exceed the amount provided by Section
230.052(b).
(e) Final award of a credit preliminarily approved under
this section remains subject to the limitations under Section
230.052(a) and all other requirements of this chapter.
Sec. 230.053. APPLICATION FOR CREDIT. (a) An entity must
apply for a credit under this chapter on or with the tax report
covering the period in which the contribution was made.
(b) The comptroller shall adopt a form for the application
for the credit. An entity must use this form in applying for the
credit and submit with the application form each receipt provided
under Section 171.702(b)(1)(F), Tax Code, that includes the
information required by Section 171.707(c), Tax Code.
(c) Subject to Section 230.052(c), the comptroller may
award a credit to an entity that applies for the credit under
Subsection (a) if the entity is eligible for the credit and the
credit is available under Section 230.052(b). The comptroller has
broad discretion in determining whether to grant or deny an
application for a credit.
(d) The comptroller shall notify an entity in writing of the
comptroller's decision to grant or deny the application under
Subsection (a). If the comptroller denies an entity's application,
the comptroller shall include in the notice of denial the reasons
for the comptroller's decision.
(e) If the comptroller denies an entity's application under
Subsection (a), the entity may request in writing a reconsideration
of the application not later than the 10th day after the date the
notice under Subsection (d) is received. If the entity does not
request a reconsideration of the application on or before that
date, the comptroller's decision is final.
(f) An entity that requests a reconsideration under
Subsection (e) may submit to the comptroller, not later than the
30th day after the date the request for reconsideration is
submitted, additional information and documents to support the
entity's request for reconsideration.
(g) The comptroller's reconsideration of an application
under this section is not a contested case under Chapter 2001,
Government Code. The comptroller's decision on a request for
reconsideration of an application is final and is not appealable.
(h) This section does not create a cause of action to
contest a decision of the comptroller to deny an application for a
credit under this chapter.
Sec. 230.054. RULES; PROCEDURES. (a) The comptroller
shall adopt rules and procedures to implement, administer, and
enforce this chapter.
(b) A rule adopted under Subsection (a) is binding on an
organization that applies for certification as an educational
assistance organization, an entity that applies for a credit, and a
state or local governmental entity, including a political
subdivision, as necessary to implement, administer, and enforce
this chapter.
Sec. 230.055. ASSIGNMENT PROHIBITED; EXCEPTION. An entity
may not convey, assign, or transfer the credit allowed under this
chapter to another entity unless all of the assets of the entity are
conveyed, assigned, or transferred in the same transaction.
Sec. 230.056. NOTICE OF AVAILABILITY OF CREDIT. The
comptroller shall provide notice of the availability of the credit
under this chapter on the comptroller's Internet website, in the
instructions for insurance premium tax report forms, and in any
notice sent to an entity concerning the requirement to file an
insurance premium tax report.
SECTION 3. (a) The constitutionality and other validity
under the state or federal constitution of all or any part of
Subchapter N, Chapter 171, Tax Code, or Chapter 230, Insurance
Code, as added by this Act, may be determined in an action for
declaratory judgment in a district court in Travis County under
Chapter 37, Civil Practice and Remedies Code, except that this
section does not authorize an award of attorney's fees against this
state and Section 37.009, Civil Practice and Remedies Code, does
not apply to an action filed under this section. This section does
not authorize a taxpayer suit to contest the denial of a tax credit
by the comptroller of public accounts.
(b) An appeal of a declaratory judgment or order, however
characterized, of a district court, including an appeal of the
judgment of an appellate court, holding or otherwise determining
that all or any part of Subchapter N, Chapter 171, Tax Code, or
Chapter 230, Insurance Code, as added by this Act, is
constitutional or unconstitutional, or otherwise valid or invalid,
under the state or federal constitution is an accelerated appeal.
(c) If the judgment or order is interlocutory, an
interlocutory appeal may be taken from the judgment or order and is
an accelerated appeal.
(d) A district court in Travis County may grant or deny a
temporary or otherwise interlocutory injunction or a permanent
injunction on the grounds of the constitutionality or
unconstitutionality, or other validity or invalidity, under the
state or federal constitution of all or any part of Subchapter N,
Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added by
this Act.
(e) There is a direct appeal to the Texas Supreme Court from
an order, however characterized, of a trial court granting or
denying a temporary or otherwise interlocutory injunction or a
permanent injunction on the grounds of the constitutionality or
unconstitutionality, or other validity or invalidity, under the
state or federal constitution of all or any part of Subchapter N,
Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added by
this Act.
(f) The direct appeal is an accelerated appeal.
(g) This section exercises the authority granted by Section
3-b, Article V, Texas Constitution.
(h) The filing of a direct appeal under this section will
automatically stay any temporary or otherwise interlocutory
injunction or permanent injunction granted in accordance with this
section pending final determination by the Texas Supreme Court,
unless the supreme court makes specific findings that the applicant
seeking such injunctive relief has pleaded and proved that:
(1) the applicant has a probable right to the relief it
seeks on final hearing; and
(2) the applicant will suffer a probable injury that
is imminent and irreparable, and that the applicant has no other
adequate legal remedy.
(i) An appeal under this section, including an
interlocutory, accelerated, or direct appeal, is governed, as
applicable, by the Texas Rules of Appellate Procedure, including
Rules 25.1(d)(6), 26.1(b), 28.1, 28.3, 32.1(g), 37.3(a)(1),
38.6(a) and (b), 40.1(b), and 49.4.
SECTION 4. An entity may apply for a credit under Subchapter
N, Chapter 171, Tax Code, or Chapter 230, Insurance Code, as added
by this Act, only for an expenditure made on or after the effective
date of this Act.
SECTION 5. Not later than February 15, 2022, the
comptroller of public accounts shall adopt rules as provided by
Section 171.712(a), Tax Code, and Section 230.054(a), Insurance
Code, as added by this Act.
SECTION 6. The comptroller of public accounts shall make
the initial determination of net savings and report regarding that
savings as required by Section 171.715, Tax Code, as added by this
Act, not later than December 31, 2024, based on the state fiscal
biennium ending August 31, 2023.
SECTION 7. This Act applies only to a report originally due
on or after the effective date of this Act.
SECTION 8. This Act takes effect January 1, 2022.