HBA-TBM S.B. 274 77(R)BILL ANALYSIS Office of House Bill AnalysisS.B. 274 By: Van de Putte County Affairs 4/20/2001 Committee Report (Amended) BACKGROUND AND PURPOSE Currently, the Tax Increment Financing Act identifies a hospital district as a participating taxing unit. This permits the ad valorem taxes assessed by a hospital district to be considered potential revenue for the development of a reinvestment zone. While such zones may be beneficial, redirecting health care money away from medical or hospital uses is not. Senate Bill 274 prohibits both the Bexar and Harris County Hospital Districts from using tax revenues to finance the development of a reinvestment zone. 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 Senate Bill 274 amends the Health and Safety Code to prohibit the Bexar County Hospital District and the Harris County Hospital District (district) from entering into a contract or agreement to pay into a tax increment fund any of a district's tax increment produced from property located in a reinvestment zone. The bill prohibits the proceeds of a tax imposed to pay bonds from being used to make a payment into a tax increment fund if that payment is prohibited by the previous provision. A project plan or reinvestment zone financing plan approved on or after September 1, 2001 is prohibited from including any of a district's tax increment or any other funds derived from the district as a source of revenue to finance or pay project costs. A project plan, reinvestment zone financing plan, or an agreement creating or expanding a reinvestment zone approved or entered into by a district before September 1, 2001 is prohibited from being modified to increase the amount of money or time a district contributes to a tax increment fund or allow the district to pay into a tax increment fund any of the district's tax increment derived from property added to the reinvestment zone on or after September 1, 2001. EFFECTIVE DATE September 1, 2001. EXPLANATION OF AMENDMENTS Committee Amendment No. 1 adds the Nueces County Hospital District and the El Paso County Hospital District to the definition of district for the purposes of the bill.