By: Bettencourt, et al.	S.B. No. 516

	A BILL TO BE ENTITLED
	AN ACT
	relating to increasing the period of time for exempting freeport
	goods from ad valorem taxation.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Sections 11.251(e), (g), and (k), Tax Code, are
	amended to read as follows:
	(e)  In determining the market value of freeport goods that
	in the preceding year were assembled, manufactured, repaired,
	maintained, processed, or fabricated in this state or used by the
	person who acquired or imported the property in the repair or
	maintenance of aircraft operated by a certificated air carrier, the
	chief appraiser shall exclude the cost of equipment, machinery, or
	materials that entered into and became component parts of the
	freeport goods but were not themselves freeport goods or that were
	not transported outside the state before the expiration of 365
	[175] days, or, if applicable, the greater number of days adopted by
	the taxing unit as authorized by Subsection (l), after they were
	brought into this state by the property owner or acquired by the
	property owner in this state.  For component parts held in bulk, the
	chief appraiser may use the average length of time a component part
	was held in this state by the property owner during the preceding
	year in determining whether the component parts were transported
	out of this state before the expiration of 365 [175] days or, if
	applicable, the greater number of days adopted by the taxing unit as
	authorized by Subsection (l).
	(g)  If the property owner or the chief appraiser
	demonstrates that the method provided by Subsection (d)
	significantly understates or overstates the market value of the
	property qualified for an exemption under Subsection (b) in the
	current year, the chief appraiser shall determine the market value
	of the freeport goods to be exempt by determining, according to the
	property owner's records and any other available information, the
	market value of those freeport goods owned by the property owner on
	January 1 of the current year, excluding the cost of equipment,
	machinery, or materials that entered into and became component
	parts of the freeport goods but were not themselves freeport goods
	or that were not transported outside the state before the
	expiration of 365 [175] days, or, if applicable, the greater number
	of days adopted by the taxing unit as authorized by Subsection (l),
	after they were brought into this state by the property owner or
	acquired by the property owner in this state.
	(k)  Property that meets the requirements of Article VIII,
	Sections 1-j(a)(1) and (2), of the Texas Constitution and that is
	transported outside of this state not later than 365 [175] days, or,
	if applicable, the greater number of days adopted by the taxing unit
	as authorized by Subsection (l), after the date the person who owns
	it on January 1 acquired it or imported it into this state is
	freeport goods regardless of whether the person who owns it on
	January 1 is the person who transports it outside of this state.
	SECTION 2.  This Act applies only to a tax year beginning on
	or after the effective date of this Act.
	SECTION 3.  This Act takes effect January 1, 2016, but only
	if the constitutional amendment proposed by the 84th Legislature,
	Regular Session, 2015, extending the number of days that certain
	tangible personal property to be transported outside of this state
	is exempt from ad valorem taxation is approved by the voters. If
	that amendment is not approved by the voters, this Act has no
	effect.