Zaffirini Data Center Bill Bans Local Deals, Only For Registered Ones

The text as introduced · 775 words

90R2352 RDS-D

By: Zaffirini
S.B. No. 36

A BILL TO BE ENTITLED

AN ACT

relating to the eligibility of data centers and large data center

projects to participate in certain incentive programs offered by

the state and local governments.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 380, Local Government Code, is amended

by adding Section 380.005 to read as follows:

Sec. 380.005. ENTITIES NOT ELIGIBLE FOR LOCAL DEVELOPMENT

AGREEMENTS. (a) In this section, "data center" and "large data

center project" have the meanings assigned by Section 312.0022, Tax

Code.

(b) Notwithstanding any other provision of this chapter,

the governing body of a municipality, or an entity with which the

governing body may contract to administer a program under this

chapter, may not enter into an agreement under this chapter if the

subject of the agreement is a data center or a large data center

project.

(c) An agreement prohibited under Subsection (b) that was

entered into before September 1, 2027, may not be renewed.

SECTION 2. Chapter 381, Local Government Code, is amended

by adding Section 381.006 to read as follows:

Sec. 381.006. ENTITIES NOT ELIGIBLE FOR LOCAL DEVELOPMENT

AGREEMENTS. (a) In this section, "data center" and "large data

center project" have the meanings assigned by Section 312.0022, Tax

Code.

(b) Notwithstanding any other provision of this chapter, a

county, county industrial commission, or development board, or an

entity with which the county, commission, or board may contract to

administer a program under this chapter, may not enter into an

agreement under this chapter if the subject of the agreement is a

data center or a large data center project.

(c) An agreement prohibited under Subsection (b) that was

entered into before September 1, 2027, may not be renewed.

SECTION 3. Section 151.359(k), Tax Code, is amended to read

as follows:

(k) A data center is not eligible to receive an exemption

under this section if the data center is the subject of:

(1) an agreement under Chapter 380 or 381, Local

Government Code;

(2) a tax abatement agreement under Chapter 312 of

this code; or

(3) [ to ] an agreement limiting the appraised value of

the data center's property under former Subchapter B or C, Chapter

313 of this code .

SECTION 4. Section 151.3595(j), Tax Code, is amended to

read as follows:

(j) A data center is not eligible to receive an exemption

under this section if the data center is the subject of:

(1) an agreement under Chapter 380 or 381, Local

Government Code;

(2) a tax abatement agreement under Chapter 312 of

this code; or

(3) [ to ] an agreement limiting the appraised value of

the data center's property under former Subchapter B or C, Chapter

313 of this code .

SECTION 5. Subchapter A, Chapter 312, Tax Code, is amended

by adding Section 312.0022 to read as follows:

Sec. 312.0022. PROHIBITION ON ABATEMENT OF TAXES ON CERTAIN

DATA CENTER PROPERTY. (a) In this section:

(1) "Data center" means a data center that has been

issued a registration number or numbers by the comptroller under

Section 151.359(e).

(2) "Large data center project" means a large data

center project that has been issued a registration number or

numbers by the comptroller under Section 151.3595(e).

(b) Notwithstanding any other provision of this chapter,

the governing body of a taxing unit may not enter into an agreement

under this chapter to exempt from taxation a portion of the value of

real property on which a data center or a large data center project

is located or is planned to be located during the term of the

agreement, or of tangible personal property located on the real

property during that term.

SECTION 6. The changes in law made by this Act apply only

to:

(1) an agreement entered into under Chapter 380 or

381, Local Government Code, or Chapter 312, Tax Code, on or after

the effective date of this Act; and

(2) an application for certification as a qualifying

data center or a qualifying large data center project submitted to

the comptroller of public accounts by a data center or a large data

center project on or after the effective date of this Act.

SECTION 7. The changes in law made by this Act do not affect

tax liability accruing before the effective date of this Act. That

liability continues in effect as if this Act had not been enacted,

and the former law is continued in effect for the collection of

taxes due and for civil and criminal enforcement of the liability

for those taxes.

SECTION 8. This Act takes effect September 1, 2027.