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<br />REQUEST FOR CITY COUNCIL AGENDA ITEM <br /> <br />Agenda Date Requested: AUl!ust 27. 2007 <br />Requested By: Michael DOlbY~ <br />Department: Finance <br /> <br />Budl!et <br /> <br />Source of Funds: <br /> <br />Account Number: <br /> <br />Report: <br /> <br />Resolution: <br /> <br />Ordinance: <br /> <br />Amount Budgeted: <br /> <br />Exhibits: Ordinance, Public Hearing Notice, Knox Askins, (Memo) <br /> <br />Amount Requested: <br /> <br />Exhibits: <br /> <br />Purdue(memo). House Bill. COpy of Article <br /> <br />Budgeted Item: YES NO <br /> <br />Exhibits <br /> <br />S, Sedic~A 1 9, Fisl:lll Note <br /> <br />SUMMARY & RECOMMENDATION <br /> <br />In the 2007 session, the Texas Legislature passed HB 621; which added Texas Property Tax Code 11.253 <br />to exempt from taxation certain tangible personal property. This bill was the implementing legislation for <br />a constitutional amendment that was passed many years ago. The bill is very similar to the Freeport <br />exemption passed many years ago, but it has a potentially larger impact as time goes on. <br /> <br />This bill exempts goods, principally inventory, that are stored in a location that is not owned by the owner <br />of the goods and are transferred from that location to another location within 175 days. The goods may <br />be in the location for the purposes of assembling, storing, manufacturing, processing, or fabricating <br />purposes by the person who acquired or imported the property. Certain specific types of goods are <br />presently excluded from this exemption: oil, natural gas, petroleum products, aircraft, dealer's motor <br />vehicle inventory, dealer's vessel and outboard motor inventory, dealer's heavy equipment inventory, or <br />retail manufactured housing inventory. Petroleum products are defined to be only the immediate <br />derivatives of oil and natural gas, so some goods that you might think of as petroleum products may <br />actually be exempted from taxation by this new law. <br /> <br />The governing body of each taxing unit in the state may act to tax these goods in the year following the <br />year in which the governing body takes action. These goods will first become exempt in 2008. If the <br />City of La Porte wishes to continue to tax these types of goods in 2008, the City of La Porte must act to <br />tax these goods. <br /> <br />Action Required by Council: <br /> <br />Approve ordinance 2007 - -which will allow us to continue taxing these goods. <br /> <br />A <br /> <br /> <br />enda <br /> <br />8kl/07 <br />Date I ( <br />