Bill Text: TX SB826 | 2019-2020 | 86th Legislature | Introduced


Bill Title: Relating to rural and opportunity funds and insurance tax credits for certain investments in those funds; imposing a monetary penalty; authorizing fees.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2019-03-19 - Left pending in committee [SB826 Detail]

Download: Texas-2019-SB826-Introduced.html
  86R7668 BEF-D
 
  By: Hancock S.B. No. 826
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to rural and opportunity funds and insurance tax credits
  for certain investments in those funds; imposing a monetary
  penalty; authorizing fees.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle F, Title 4, Government Code, is amended
  by adding Chapter 487A to read as follows:
  CHAPTER 487A. RURAL AND OPPORTUNITY FUNDS
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 487A.0001.  GENERAL DEFINITIONS. In this chapter:
               (1)  "Closing date" means the date a rural and
  opportunity fund has collected all of the amounts described by
  Section 487A.0056(a)(1).
               (2)  "Growth investment" means any capital or equity
  investment by a rural and opportunity fund in a targeted small
  business or any loan by a rural and opportunity fund to a targeted
  small business with a stated maturity date of at least one year
  after the date of issuance.
               (3)  "Office" means the Texas Economic Development and
  Tourism Office.
               (4)  "Qualified area" means:
                     (A)  a rural community as defined by Section
  12.046, Agriculture Code; or
                     (B)  a qualified opportunity zone as defined by
  Section 1400Z-1, Internal Revenue Code of 1986.
               (5)  "Rural and opportunity fund" means an entity
  approved by the office as a rural and opportunity fund.
         Sec. 487A.0002.  DEFINITION: AFFILIATE. (a) In this
  chapter, "affiliate" means an entity that directly or indirectly
  through one or more intermediaries controls, is controlled by, or
  is under common control with another entity.
         (b)  For purposes of Subsection (a), an entity is controlled
  by another entity if the controlling entity:
               (1)  holds, directly or indirectly, the majority voting
  or ownership interest in the controlled entity; or
               (2)  has control over the day-to-day operations of the
  controlled entity by contract or by law.
         Sec. 487A.0003.  DEFINITION: CREDIT-ELIGIBLE CAPITAL
  CONTRIBUTION. (a) In this chapter and subject to Subsection (b),
  "credit-eligible capital contribution" means an investment of cash
  that equals the amount specified on a tax credit certificate issued
  by the office under Section 487A.0055(2) made by an entity that is
  subject to state insurance tax liability, as defined by Section
  232.0001, Insurance Code.
         (b)  An investment made by an entity qualifies as a
  credit-eligible capital contribution only if the entity making the
  investment receives in exchange for the investment:
               (1)  an equity interest in the rural and opportunity
  fund; or
               (2)  at par value or premium, a debt instrument that has
  a maturity date of at least five years from the closing date and a
  repayment schedule that is no faster than level principal
  amortization over five years.
         Sec. 487A.0004.  DEFINITION: INVESTMENT AUTHORITY. (a) In
  this chapter, "investment authority" means the amount stated on the
  notice issued under Section 487A.0055(1) approving the rural and
  opportunity fund.
         (b)  At least 65 percent of a rural and opportunity fund's
  investment authority must consist of credit-eligible capital
  contributions.
         Sec. 487A.0005.  DEFINITION: JOBS CREATED. (a) In this
  chapter, "jobs created" means, with respect to a targeted small
  business, employment positions that are created by the targeted
  small business, are located in this state, require at least 35 hours
  of work each week, and were not located in this state at the time of
  the initial growth investment in the targeted small business.
         (b)  The number of jobs created by a targeted small business
  is calculated each year by subtracting the number of employment
  positions in this state at the targeted small business at the time
  of the initial growth investment in the targeted small business
  from the monthly average of those employment positions for that
  year. If the number calculated under this subsection is less than
  zero, the number shall be reported as zero.
         (c)  The monthly average of employment positions for a year
  is calculated by adding together the number of employment positions
  existing on the last day of each month of the year and dividing by
  12.
         Sec. 487A.0006.  DEFINITION: JOBS RETAINED. (a) In this
  chapter, "jobs retained" means, with respect to a targeted small
  business, employment positions:
               (1)  located in this state requiring at least 35 hours
  of work each week that existed before the initial growth investment
  in the targeted small business; and
               (2)  that would have been lost or moved out of this
  state had a growth investment in the targeted small business not
  been made, as certified in writing by an executive officer of the
  targeted small business to the rural and opportunity fund.
         (b)  The number of jobs retained by a targeted small business
  is calculated each year based on the monthly average of employment
  positions for that year.
         (c)  The monthly average of employment positions for a year
  is calculated by adding together the number of employment positions
  existing on the last day of each month of the year and dividing by
  12.
         (d)  The reported number of jobs retained for a year may not
  exceed the number reported on the initial report under Section
  487A.0155. The rural and opportunity fund shall reduce the number
  of jobs retained for a year if employment at the targeted small
  business drops below the number reported on the initial report.
         Sec. 487A.0007.  DEFINITION: TARGETED SMALL BUSINESS. (a)
  In this chapter, "targeted small business" means a business that,
  at the time of the initial growth investment in the business:
               (1)  had fewer than 250 employees; and
               (2)  has its principal business operations located in
  one or more qualified areas in this state.
         (b)  For purposes of Subsection (a)(2), the principal
  business operations of a business are located at a place where:
               (1)  at least 60 percent of the business's employees
  work; or
               (2)  employees who are paid at least 60 percent of the
  business's payroll work.
         (c)  An out-of-state business that agrees to relocate or hire
  new employees using the proceeds of a growth investment to
  establish principal business operations in a qualified area in this
  state qualifies as a targeted small business if the business
  satisfies the requirements of:
               (1)  Subsection (a)(1) at the time of the initial
  growth investment in the business; and
               (2)  Subsection (a)(2) not later than the 180th day
  after receiving the initial growth investment or a later date
  agreed to by the office.
         Sec. 487A.0008.  RULES. The office shall adopt rules
  necessary to implement this chapter.
  SUBCHAPTER B. APPROVAL OF RURAL AND OPPORTUNITY FUNDS
         Sec. 487A.0051.  APPLICATION. (a) The office shall accept
  applications from entities seeking approval as rural and
  opportunity funds.
         (b)  An application must include:
               (1)  the total investment authority sought by the
  applicant under the applicant's business plan;
               (2)  evidence sufficient to prove to the office's
  satisfaction that, as of the date the applicant submits the
  application:
                     (A)  the applicant or affiliates of the applicant
  have invested at least $100 million in nonpublic companies, each of
  which is located in a municipality with a population of less than
  50,000 or a county with a population of less than 200,000,
  regardless of whether the municipality or county is located inside
  or outside this state; and
                     (B)  at least one principal in a rural business
  investment company licensed under 7 U.S.C. Section 2009cc et seq.
  or a small business investment company licensed under 15 U.S.C.
  Section 681 is, and has been for at least four years, an officer or
  employee of the applicant or of an affiliate of the applicant on the
  date the application is submitted;
               (3)  a copy of the rural business investment company
  license or small business investment company license described by
  Subdivision (2)(B);
               (4)  an estimate of the number of jobs created and jobs
  retained as a result of the applicant's growth investments;
               (5)  a business plan that includes a revenue impact
  assessment that:
                     (A)  projects state and local tax revenue to be
  generated by the applicant's proposed growth investments; and
                     (B)  is prepared by a nationally recognized third
  party independent economic forecasting firm using a dynamic
  economic forecasting model that analyzes the applicant's business
  plan for the 10-year period following the date the applicant
  submits the application;
               (6)  a signed affidavit from each committed investor
  stating the amount of credit-eligible capital contributions the
  investor commits to making; and
               (7)  a nonrefundable application fee of $5,000.
         Sec. 487A.0052.  DECISION ON APPLICATION. (a) The office
  shall make a determination on each application not later than the
  30th day after the date the office receives the application. The
  office shall make application determinations in the order in which
  applications are received and shall consider applications received
  on the same day to be received simultaneously.
         (b)  The office may approve investment authority under this
  chapter in amounts that would allow not more than $35 million in tax
  credits to be claimed under Section 232.0053, Insurance Code, in
  any calendar year, excluding any credit carryforwards under Section
  232.0054, Insurance Code.
         (c)  If a request for investment authority exceeds the
  limitation under Subsection (b), the office shall reduce the
  investment authority and the credit-eligible capital contributions
  for that application as necessary to avoid exceeding the limit. If
  multiple applications received on the same day request a combined
  investment authority that exceeds the limit under Subsection (b),
  the office shall proportionally reduce the investment authority and
  the credit-eligible capital contributions for those applications
  as necessary to avoid exceeding the limit. The office may not
  reduce an applicant's investment authority for any reason other
  than as authorized by this subsection.
         Sec. 487A.0053.  GROUNDS FOR DENIAL. The office may deny an
  application under this subchapter only if:
               (1)  the application is incomplete or the application
  fee is not paid in full;
               (2)  the applicant fails to satisfy the requirements of
  Section 487A.0051(b)(2);
               (3)  the revenue impact assessment submitted under
  Section 487A.0051(b)(5) does not demonstrate that the applicant's
  business plan will result in a positive economic impact on combined
  state and local revenue during the 10-year period covered by the
  assessment that exceeds the cumulative amount of tax credits that
  would be issued to the applicant's investors under Chapter 232,
  Insurance Code, if the application were approved;
               (4)  the credit-eligible capital contributions
  described in affidavits submitted under Section 487A.0051(b)(6) do
  not equal at least 65 percent of the total amount of investment
  authority sought under the applicant's business plan; or
               (5)  the office has already approved the maximum amount
  of investment authority allowed under Section 487A.0052(b).
         Sec. 487A.0054.  SUBMISSION OF ADDITIONAL INFORMATION
  FOLLOWING DENIAL. (a) If the office denies an application the
  applicant may, not later than the 15th day after the date the office
  provides notice of denial, provide additional information to the
  office to complete, clarify, or cure defects in the application
  identified by the office.
         (b)  If the applicant completes, clarifies, or cures the
  defects in its application during the period prescribed by
  Subsection (a), the application is considered complete as of the
  original submission date.
         (c)  If the applicant fails to complete, clarify, or cure the
  defects in its application during the period prescribed by
  Subsection (a), the application is finally denied. An applicant
  who wishes to reapply must resubmit an application in full with a
  new submission date.
         (d)  The office shall review and reconsider an application
  described by Subsection (a) for which the applicant provides
  additional information not later than the 30th day after the date
  the applicant provides the information. The office shall consider
  that application before any pending applications submitted after
  the date that application was originally submitted.
         (e)  This section does not apply to an application denied as
  a result of the applicant's failure to submit with the application
  affidavits required by Section 487A.0051(b)(6).
         Sec. 487A.0055.  APPROVAL BY OFFICE. On approval of an
  application, the office shall provide:
               (1)  written notice to the applicant of the applicant's
  approval as a rural and opportunity fund, including the amount of
  the fund's investment authority; and
               (2)  a tax credit certificate to each investor whose
  affidavit was included in the application and include on the
  certificate the amount of the investor's credit-eligible capital
  contribution.
         Sec. 487A.0056.  DUTIES OF FUND FOLLOWING APPROVAL. (a) A
  rural and opportunity fund shall:
               (1)  not later than the 60th day after the date the fund
  receives the approval notice under Section 487A.0055:
                     (A)  collect the credit-eligible capital
  contribution from each investor issued a tax credit certificate
  under Section 487A.0055; and
                     (B)  subject to Subsection (b), collect one or
  more investments of cash that, when added to the contributions
  collected under Paragraph (A), equal the fund's investment
  authority; and
               (2)  not later than the 65th day after the date the fund
  receives the approval notice under Section 487A.0055, send to the
  office documentation sufficient to prove that the fund has
  collected the amounts described in Subdivision (1).
         (b)  At least 10 percent of the rural and opportunity fund's
  investment authority must consist of equity investments
  contributed directly or indirectly by affiliates of the fund,
  including employees, officers, and directors of those affiliates.
         Sec. 487A.0057.  LAPSE OF APPROVAL. (a) If a rural and
  opportunity fund fails to comply with the requirements of Section
  487A.0056, the fund's approval lapses and the corresponding
  investment authority described by Section 487A.0056(a)(1) does not
  count toward the limit prescribed by Section 487A.0052(b).
         (b)  The office shall first award lapsed investment
  authority pro rata to each rural and opportunity fund whose
  requested investment authority was reduced under Section
  487A.0052(c). The rural and opportunity fund may allocate the
  investment authority awarded under this subsection to the fund's
  investors in the fund's discretion. The office may award any
  remaining investment authority to new applicants.
         Sec. 487A.0058.  DISPOSITION OF APPLICATION FEES.
  Application fees submitted to the office under Section
  487A.0051(b)(7) shall be deposited to the credit of the general
  revenue fund and may be appropriated only to the office for the
  purpose of administering this chapter.
  SUBCHAPTER C. REVOCATION OF TAX CREDIT CERTIFICATE
         Sec. 487A.0101.  GROUNDS FOR REVOCATION. (a) The office
  shall revoke a tax credit certificate issued under Subchapter B in
  connection with an investment in a rural and opportunity fund if,
  before the fund exits the program under Section 487A.0151, the
  fund:
               (1)  subject to Subsection (b), fails to invest at
  least 60 percent of the fund's investment authority in growth
  investments in this state on or before the second anniversary of the
  closing date and 100 percent of the fund's investment authority in
  growth investments in this state on or before the third anniversary
  of the closing date;
               (2)  subject to Subsection (c) and after making the
  investments necessary to avoid revocation under Subdivision (1),
  fails to maintain growth investments equal to 100 percent of the
  fund's investment authority until the sixth anniversary of the
  closing date;
               (3)  makes a distribution or payment that results in
  the fund having less than 100 percent of its investment authority
  invested in growth investments in this state or available for
  investment in growth investments and held in cash or marketable
  securities; or
               (4)  subject to Subsection (d), makes a growth
  investment in a targeted small business that directly or indirectly
  through an affiliate owns, has the right to acquire an ownership
  interest in, makes a loan to, or makes an investment in the fund, an
  affiliate of the fund, or an investor in the fund.
         (b)  For purposes of Subsection (a)(1):
               (1)  the amount of growth investments that a rural and
  opportunity fund may count with respect to a particular targeted
  small business, including any amount invested in an affiliate of
  the targeted small business, may not exceed the greater of $5
  million or 20 percent of the fund's investment authority; and
               (2)  at least 85 percent of the required investments
  must be growth investments in targeted small businesses whose
  principal business operations are located in, or are relocated to,
  one or more rural communities as defined by Section 12.046,
  Agriculture Code.
         (c)  For purposes of Subsection (a)(2):
               (1)  the amount of growth investments that a rural and
  opportunity fund may count with respect to a particular targeted
  small business, including any amount invested in an affiliate of
  the targeted small business, may not exceed the greater of $5
  million or 20 percent of the fund's investment authority;
               (2)  an investment that is sold or repaid is considered
  to be maintained if the rural and opportunity fund reinvests an
  amount equal to the capital returned or recovered by the fund from
  the original investment, excluding any profit realized, in another
  growth investment in this state on or before the first anniversary
  of the date the capital is returned or recovered; and
               (3)  an amount received periodically by a rural and
  opportunity fund is considered to be continually invested in growth
  investments if that amount is reinvested in one or more growth
  investments by the end of the calendar year following the year of
  receipt.
         (d)  Subsection (a)(4) does not apply to investments in
  publicly traded securities by a targeted small business or an owner
  or affiliate of the targeted small business. For purposes of
  Subsection (a)(4), a rural and opportunity fund is not considered
  an affiliate of a targeted small business solely as a result of the
  fund's growth investment in the targeted small business.
         (e)  The office shall:
               (1)  notify the comptroller when the office revokes a
  tax credit certificate; and
               (2)  on request, provide the comptroller with lists of
  valid and revoked tax credit certificates.
         Sec. 487A.0102.  OPPORTUNITY TO CORRECT VIOLATION. (a)
  Before revoking a tax credit certificate under this subchapter, the
  office shall notify the rural and opportunity fund of the reasons
  for the pending revocation.
         (b)  The rural and opportunity fund may, not later than the
  90th day after the date the notice is received, correct any
  violation outlined in the notice to the satisfaction of the office
  and avoid revocation of the tax credit certificate.
         Sec. 487A.0103.  ALLOCATION OF REVOKED INVESTMENT
  AUTHORITY. (a) If a tax credit certificate is revoked under this
  subchapter, the associated investment authority does not count
  toward the limit on total investment authority described in Section
  487A.0052(b).
         (b)  The office shall first award revoked investment
  authority pro rata to each rural and opportunity fund whose
  requested investment authority was reduced under Section
  487A.0052(c). The office may award any remaining investment
  authority to new applicants.
  SUBCHAPTER D. CERTAIN FUND OPERATIONS
         Sec. 487A.0151.  APPLICATION TO EXIT PROGRAM. (a) On or
  after the sixth anniversary of the closing date, a rural and
  opportunity fund may apply to the office to exit the program and no
  longer be subject to regulation under this chapter.
         (b)  The office shall respond to the application not later
  than the 30th day after receipt.
         (c)  A rural and opportunity fund is eligible to exit the
  program under this section if no tax credit certificates related to
  investments in the fund have been revoked and the fund has not
  received any revocation notice that has not been corrected under
  Section 487A.0102.
         (d)  The office may not unreasonably deny an application
  under this section. The office shall give the rural and opportunity
  fund notice of a denial and include in the notice the reasons for
  the denial.
         Sec. 487A.0152.  NO REVOCATION FOLLOWING EXIT. The office
  may not revoke a tax credit certificate related to an investment in
  a rural and opportunity fund after the fund's exit from the program.
         Sec. 487A.0153.  PENALTY FOR CERTAIN DISTRIBUTIONS. (a)
  For purposes of this section:
               (1)  the "actual number of jobs created and retained"
  is the number of jobs created and jobs retained as a result of all of
  a rural and opportunity fund's current and former growth
  investments, as reported on the fund's reports submitted under
  Section 487A.0155; and
               (2)  the "estimated number of jobs created and
  retained" is the estimated number of jobs created and jobs retained
  included in a rural and opportunity fund's application under
  Section 487A.0051(b)(4) reduced, if applicable, by the same
  percentage as the total investment authority sought under the
  fund's business plan submitted under Section 487A.0051(b)(1) was
  reduced under Section 487A.0052(c).
         (b)  A rural and opportunity fund is subject to a penalty in
  the amount provided by Subsection (c) if:
               (1)  the fund authorizes a distribution to the fund's
  equity holders in an amount that, when added to all previous
  distributions to the fund's equity holders and any previous
  penalties under this section, exceeds the fund's investment
  authority; and
               (2)  the fund's actual number of jobs created and
  retained is less than the fund's estimated number of jobs created
  and retained.
         (c)  The amount of the penalty is equal to the amount of the
  authorized distribution multiplied by a fraction:
               (1)  the numerator of which is the fund's estimated
  number of jobs created and retained less the fund's actual number of
  jobs created and retained; and
               (2)  the denominator of which is the fund's estimated
  number of jobs created and retained.
         (d)  Before making a distribution to the fund's equity
  holders, the fund shall deduct the amount of the penalty from the
  amount otherwise authorized to be distributed to the equity holders
  and pay the penalty to the office.
         (e)  The office shall deposit penalties received under
  Subsection (d) in the general revenue fund.
         Sec. 487A.0154.  EVALUATION OF PROPOSED INVESTMENT. (a) A
  rural and opportunity fund, before making a growth investment, may
  request from the office a written opinion as to whether the business
  in which the fund proposes to invest qualifies as a targeted small
  business.
         (b)  Not later than the 15th business day after receiving the
  request, the office shall notify the rural and opportunity fund of
  its determination.
         (c)  If the office fails to notify the rural and opportunity
  fund of its determination on or before the 15th business day after
  receiving the request, the business in which the fund proposes to
  invest is considered to be a targeted small business for purposes of
  this chapter.
         Sec. 487A.0155.  ANNUAL REPORT. (a) A rural and opportunity
  fund shall submit a report to the office on or before the fifth
  business day after each anniversary of the closing date until the
  fund has exited the program under Section 487A.0151.
         (b)  The report must document the rural and opportunity
  fund's growth investments and include:
               (1)  a bank statement showing each growth investment;
               (2)  the name, location, and industry of each business
  receiving a growth investment, including either the determination
  notice described by Section 487A.0154 or evidence that the business
  qualified as a targeted small business at the time the investment
  was made;
               (3)  the number of jobs created and jobs retained in the
  preceding calendar year as a result of the fund's growth
  investments as of the last day of that period;
               (4)  the average annual salary of the jobs described by
  Subdivision (3); and
               (5)  any other information the office requires.
         (c)  A rural and opportunity fund may, but is not required
  to, include in any report submitted under this section information
  about the number of jobs created and jobs retained with respect to a
  former growth investment that the fund has exited.
         SECTION 2.  Subtitle B, Title 3, Insurance Code, is amended
  by adding Chapter 232 to read as follows:
  CHAPTER 232. TAX CREDIT FOR INVESTMENT IN RURAL AND OPPORTUNITY
  FUND
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 232.0001.  DEFINITIONS. In this chapter:
               (1)  "Affiliate" has the meaning assigned by Section
  487A.0002, Government Code.
               (2)  "Closing date" has the meaning assigned by Section
  487A.0001, Government Code.
               (3)  "State insurance tax liability" means any tax
  liability incurred under Chapter 221, 222, 223, 223A, 224, 225,
  226, or 281.
         Sec. 232.0002.  RULES. The comptroller shall adopt rules
  necessary to implement this chapter.
  SUBCHAPTER B. TAX CREDIT
         Sec. 232.0051.  ELIGIBILITY FOR CREDIT. An entity is
  eligible for a credit against the entity's state insurance tax
  liability in the amount and under the conditions and limitations
  provided by this chapter.
         Sec. 232.0052.  QUALIFICATION. An entity is eligible for a
  credit for a tax year if:
               (1)  the entity holds a tax credit certificate issued
  under Section 487A.0055, Government Code; and
               (2)  the third, fourth, fifth, or sixth anniversary of
  the closing date in connection with which the certificate was
  issued occurs during the tax year.
         Sec. 232.0053.  AMOUNT OF CREDIT; LIMITATION. (a) The
  amount of credit for a tax year is equal to 25 percent of the amount
  of the credit-eligible capital contribution stated on the tax
  credit certificate described by Section 232.0052.
         (b)  The total credit claimed for a tax year, including the
  amount of any carryforward under Section 232.0054, may not exceed
  the amount of state insurance tax liability due for the entity for
  the tax year after applying all other applicable tax credits.
         (c)  Credits may be applied to the entity's estimated or
  final tax payments for the tax year.
         Sec. 232.0054.  CARRYFORWARD. If an entity is eligible for a
  credit that exceeds the limitation under Section 232.0053(b), the
  entity may carry the unused credit forward for not more than 20
  consecutive tax reports. Credits, including credit carryforwards,
  are considered to be used in the following order:
               (1)  a credit carryforward under this chapter; and
               (2)  a current year credit.
         Sec. 232.0055.  ASSIGNMENT PROHIBITED. (a) Except as
  provided by Subsection (b), an entity may not convey, assign, or
  transfer the credit allowed under this chapter to another entity.
         (b)  An entity may convey, assign, or transfer the credit
  allowed under this chapter to an affiliate of the entity that is
  subject to state insurance tax liability.
         Sec. 232.0056.  RETALIATORY TAX. An entity claiming a
  credit under this chapter is not required to pay any additional
  retaliatory tax levied under Chapter 281 as a result of claiming
  that credit.
  SUBCHAPTER C. RECAPTURE OF CREDIT
         Sec. 232.0101.  RECAPTURE. The comptroller shall recapture
  the amount of a credit claimed on a tax report filed under Chapter
  221, 222, 223, 223A, 224, 225, 226, or 281 from an entity if the tax
  credit certificate on which the credit is based is revoked under
  Subchapter C, Chapter 487A, Government Code.
         SECTION 3.  (a) As soon as practicable after this Act
  becomes law as provided by Section 2001.006, Government Code:
               (1)  the Texas Economic Development and Tourism Office
  shall adopt rules necessary to implement Chapter 487A, Government
  Code, as added by this Act; and
               (2)  the comptroller of public accounts shall adopt
  rules necessary to implement Chapter 232, Insurance Code, as added
  by this Act.
         (b)  Not later than January 1, 2020, the Texas Economic
  Development and Tourism Office shall begin accepting applications
  under Section 487A.0051(a), Government Code, as added by this Act.
         SECTION 4.  Chapter 232, Insurance Code, as added by this
  Act, applies only to a tax report originally due on or after January
  1, 2020.
         SECTION 5.  This Act takes effect September 1, 2019.
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