HBA-SEP H.B. 824 77(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 824
By: Ellis, Dan
Ways & Means
7/18/2001
Enrolled



BACKGROUND AND PURPOSE 

Prior to the 77th Legislature, state law did not exempt county fair
associations that own land and buildings from ad valorem taxation
(taxation) of the property.  While most county fair association property is
owned by a county and is therefore exempt, and other counties give the
county tax assessors discretion to exempt the property owned by the county
fair association, a statewide policy to exempt county fair associations
from taxation of property benefits those county fair associations that are
not presently exempt.  House Bill 824 entitles a nonprofit county fair
association organized to hold agricultural fairs and encourage agricultural
pursuits to a tax exemption on the land and buildings it owns and uses to
hold agricultural fairs.   

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 824 amends the Tax Code to entitle a county fair association
organized to hold agricultural fairs and encourage agricultural pursuits to
a tax exemption on the land and buildings it owns and uses to hold
agricultural fairs.  An association that holds a license issued after
January 1, 2001, under the Texas Racing Act to conduct a horse race meeting
or a greyhound race meeting with pari-mutuel wagering is not entitled to an
exemption.  The bill prohibits land or a building used to conduct such a
race from being exempt.  The bill provides that, to qualify for an
exemption, a county fair association must: 

_be a nonprofit corporation as defined by the Texas Non-Profit Corporation
Act; 

_be exempt from federal income taxes as an organization; 

_qualify for an exemption from the franchise tax under the exemption for a
nonprofit corporation organized for agricultural purposes; and 

_meet the qualifications of a charitable organization.

EFFECTIVE DATE

January 1, 2002.