03-04-04 La Porte Development Corporation Minutes

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Economic Development Sales T~ (96-302) Page 2 of8 The composition of the corporation's board of directors and the length of a member's term differ between ~4A and ~4B. Under ~4A: The city's governing body must appoint a five-member board. Each member is appointed to a term not to exceed six years. Under ~4B: The city's governing body must appoint seven directors. Three of the seven directors cannot be employees, officers or members of the city's governing body. The other four directors may be - but are not required to be - members of the governing body or city employees. All directors are appointed to a two-year term under ~4B. The directors of a corporation authorized under ~4B must be residents of the city authorizing the sales tax if the city's population is 20,000 or more. There is no city residency requirement for ~4B directors in cities with fewer than 20,000 population as long as the director is a resident of the county in which the majority of the city is located, or resides within 10 miles of the city and is in a county which borders the county in which a majority of the city is located. The board of directors authorized under ~4A and ~4B serves at the pleasure of the governing body and must conduct meetings within the city's boundaries. A corporation's registered agent must be a Texas resident, and the corporation's registered office must be within the city's boundaries. How can tax revenue be used? ~4A Sales Tax The tax is primarily intended for manufacturing and industrial development, and cities may use the money raised by this sales tax to acquire land, buildings, equipment, facilities, expenditures, targeted infrastructure and improvements for purposes related to: . manufacturing and industrial facilities, recycling facilities, distribution centers, small warehouse facilities; . research and development facilities, regional or national corporate headquarters facilities, primary job training facilities for use by institutions of higher education, job training classes; . a general aviation business service airport that is an integral part of an industrial park; . certain infrastructure improvements, which promote or develop new or expanded business enterprises; . port-related facilities to support waterborne commerce; and . maintenance and operating costs associated with projects. After a public hearing and voter approval, g4A corporations may use their revenue to undertake projects eligible under g4B, without voting to abolish the g4A tax and impose the g4B tax. The law specifies the g4A corporation's requirements for publishing notice of a proposed g4B project and the procedures for holding at least one public hearing on the proposed project before the election. The ballot must clearly describe the g4B projects that will be funded from the g4A tax. ~4A corporations may, following a separate election to gain voter approval, spend their g4A http://www.window.state.tx.us/taxinfo/taxpubs/tx96 _ 302 .html 8/1712004