TITLE 34. PUBLIC FINANCE

PART 1. COMPTROLLER OF PUBLIC ACCOUNTS

CHAPTER 9. PROPERTY TAX ADMINISTRATION

SUBCHAPTER F. LIMITATION ON APPRAISED VALUE ON CERTAIN QUALIFIED PROPERTIES

34 TAC §9.1052

The Comptroller of Public Accounts adopts amendments to §9.1052 concerning forms, with changes to the proposed text as published in the November 19, 2021, issue of the Texas Register (46 TexReg 7866). The rule will be republished. The comptroller is withdrawing the amendment to §9.1051 regarding the Annual Eligibility Report in response to comments received and will be submitting the withdrawal in a separate submission at the same time this adoption is submitted.

Amended §9.1052 provides a revised online Biennial Progress Report, a revised online Biennial School District Cost Data Request (CDR) and a simplified reporting process via the comptroller's online reporting system.

The comptroller received 349 comments from organizations/interest groups, law firms and individuals including legislators. The New Hope Baptist Church, the Metropolitan Organization, the Texas IAF, Abiding Presence Lutheran Church, Interfaith/Community Action Network (I/CAN), the Network of Texas IAF Organizations, the University Presbyterian Church of San Antonio, COPS/Metro, First Congregational Church of Houston, Francis of Assisi parish, Our Lady of Guadalupe Church of San Antonio COPS/METRO, Central Texas Interfaith, the First Unitarian Universalist Church of San Antonio-COPS/Metro, Texas State Teachers Association, Texas AFT (American Federation of Teachers), Texas AFL-CIO, Coalition of Texans with Disabilities, IDRA (Intercultural Development Research Association), League of Women Voters of Texas, National Association of Social Workers - Texas, Progress Texas, Impact Texas, La Fe Policy Research and Education Center, Every Texan, Sister of Divine Providence based in San Antonio, Texas, St. Timothy Catholic Church of San Antonio-COPS/Metro, Congregational Church of Austin, Ursuline Sister from the Central Province of the United States, St. Leo the Great Catholic Church in Houston, Dallas Area Interfaith, Macedonia Baptist Church of San Antonio-COPS/Metro, First Congregational Church, Holy Family Parish, Texas Campaign for the Environment/TCE Fund, Christ Redeeming Community Church, Freedom of Information Foundation of Texas, Good Jobs First, Padon Accounting and Project Management Services, Shivers and Shivers, the Center for Economic Accountability and Texas Public Policy Foundation disagreed with adopting the proposed rule amendments. Their comments suggest that the proposed rule amendments concerning the Annual Eligibility Report, the Biennial School District Cost Data Request and the Biennial Progress Report will reduce program transparency and access to information needed for evaluating the program. Additionally, they contend that it's the comptroller's responsibility to collect the reported information for agreement holder accountability and to protect the state's finances.

In the comments, the Texas House Democratic Caucus expressed disapproval of the proposed rule amendments and asserted that transparency is necessary for the legislature to evaluate the program or similar programs. They also stated that the public deserves to know the information as well.

A partner of Moak, Casey & Associates expressed opposition to the amendments that eliminate forms and datasets from forms but supported streamlining electronic submissions.

Texas Taxpayers and Research Association (TTARA) and the Texas Association of Manufacturers (TAM) fully supported the proposed rule amendments. They professed that a condensed web-based Biennial Progress Report would streamline the reporting process, optimize the agency's data analysis/processing and reduce company expenditures on recurring submissions of the same datasets. They also defended eliminating the Biennial School District Cost Data Request for the sake of simplifying the reporting process and emphasized that the Annual Eligibility Report would still be public information subject to open records.

Under the proposed amendments to §9.1051, school districts would no longer be required to forward a copy of the Annual Eligibility Report to the comptroller for purposes of making the report publicly accessible on the comptroller's website. Based on the comments, the comptroller will withdraw the proposed amendments to §9.1051 and will continue to post the Annual Eligibility Report as a substantive document on its website following receipt from the school districts.

Based on the comments, the comptroller agrees to retain the Biennial School District Cost Data Request (CDR) with modifications. While the total tax benefits projected for 10-20 years in the CDR are not reliable, many commenters use the projections as a point of reference for future taxable value and tax rates. The comptroller adopts the Biennial School District Cost Data Request as a single online form containing or requiring the upload of substantially the same data in the three-digit and four-digit Biennial School District Cost Data Requests.

The comptroller agrees in part with the commenters that opposed the changes to the Biennial Progress Report. The comptroller will include questions to the proposed Biennial Progress Report to collect data on the date of commencement of operations, the number of non-qualifying jobs in the reporting year, and the total wages of non-qualifying jobs in the reporting year. The comptroller disagrees with comments that would prevent the removal of several redundant questions that are publicly available in other posted forms such as agreements and applications. Consequently, the comptroller adopts the Biennial Progress Report with minor non-substantive changes, elimination of redundant questions and with the inclusion of §3, question 3, as well as §5, questions 7 and 8, from the current four-digit form. The adopted questions are available on the comptroller's website at https://comptroller.texas.gov/economy/local/ch313/forms.php.

The comptroller agrees with the commenters supporting improvements to the Chapter 313 data collection and reporting system. Staying current with technological advances has an enormous impact on the way programs are administrated by the comptroller. To provide the best service, implementing upgrades to the data collection and reporting systems for the Chapter 313 program is essential. These upgrades will improve program compliance and efficiency. The comptroller adopts amendments to §9.1052(b) with changes to collect all reports and online forms via the comptroller's online reporting system.

To allow adequate time for implementation, the comptroller adds January 1, 2023 as the effective date for the adoption of the amendments herein.

The amendments are adopted under Tax Code, §313.031, which authorizes the comptroller to adopt rules necessary for the implementation and administration of Tax Code, Chapter 313.

The amendments implement Tax Code, Chapter 313.

§9.1052.Forms.

(a) The comptroller adopts by reference the followingforms:

(1) Application for Appraised Value Limitation on Qualified Property (Form 50-296A);

(2) Annual Eligibility Report (Form 50-772A);

(3) Job Creation Compliance Report (Form 50-825); and

(4) Texas Economic Development Act Agreement (Form 50-826).

(b) Agreement holders must complete and submit all reports and online forms including the Biennial Progress Report and the Biennial School District Cost Data Request through the comptroller's online reporting system.

(c) Copies of the forms are available for inspection at the office of the Texas Register or may be obtained from the Comptroller of Public Accounts, P.O. Box 13528, Austin, Texas 78711-3528. The forms may be viewed or downloaded from the comptroller's website, at https://www.comptroller.texas.gov/economy/local/ch313/forms.php. Copies may also be requested by calling our toll-free number, (800) 531-5441, extension 34679.

(d) In special circumstances, a school district may obtain prior approval in writing from the comptroller to use an application or agreement form that requires additional information, or sets out the required information in different language or sequence than that which this section requires.

(e) The comptroller may periodically update the dates, form version numbers, and/or years in the appropriately marked sections of the forms described in subsection (a) of this section.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on April 19, 2022.

TRD-202201481

Don Neal

General Counsel, Operations and Support Legal Services

Comptroller of Public Accounts

Effective date: January 1, 2023

Proposal publication date: November 19, 2021

For further information, please call: (512) 475-0387