84R5714 CJC-F
	By: Button	H.B. No. 2096

	A BILL TO BE ENTITLED
	AN ACT
	relating to the temporary exemption of certain tangible personal
	property related to a data center from the state sales and use tax.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Sections 151.359(a)(2), (3), (5), (7), and (8),
	Tax Code, are amended to read as follows:
	(2)  "Data center" means all or part of a new or
	redeveloped facility that [at least 100,000 square feet of space in
	a single building or portion of a single building, which space]:
	(A)  is located in this state;
	(B)  is composed of one or more buildings and
	related improvements specifically constructed or refurbished,
	repaired, restored, remodeled, or otherwise modified and actually
	used primarily to house servers and related equipment and support
	staff for the processing, storage, and distribution of data;
	(C)  is designed for use [used] by one or more [a
	single] qualifying occupants [occupant] for the processing,
	storage, and distribution of data;
	(D)  is not used primarily by a telecommunications
	provider to place tangible personal property that is used to
	deliver telecommunications services; and
	(E)  has an uninterruptible power source,
	generator backup power, a sophisticated fire suppression and
	prevention system, and enhanced physical security that includes
	restricted access, video surveillance, and electronic systems.
	(3)  "Permanent job" means an employment position that
	will exist for at least three [five] years after the date the job is
	created.
	(5)  "Qualifying job" means a full-time, permanent job
	that pays at least [120 percent of] the county average weekly wage
	in the county in which the job is based.
	(7)  "Qualifying owner" means a person who owns the
	building or buildings in which a qualifying data center is
	located.  A qualifying owner may also be the qualifying operator.
	(8)  "Qualifying occupant" means a person who:
	(A)  contracts with a qualifying owner or
	qualifying operator:
	(i)  for at least one megawatt of critical IT
	load per month for a period of at least two years; and
	(ii)  to place, or cause to be placed, and to
	use tangible personal property at the qualifying data center; or
	(B)  in the case of a qualifying occupant who is
	also the qualifying owner and the qualifying operator, places or
	causes to be placed, and uses tangible personal property at the
	qualifying data center.
	SECTION 2.  Section 151.359, Tax Code, is amended by
	amending Subsections (c), (d), (e), and (f) and adding Subsections
	(e-1) and (l) to read as follows:
	(c)  The exemption provided by this section does not apply
	to:
	(1)  office equipment or supplies;
	(2)  maintenance or janitorial supplies or equipment;
	(3)  equipment or supplies used primarily in sales
	activities or transportation activities;
	(4)  tangible personal property on which the purchaser
	has received or has a pending application for a refund under Section
	151.429;
	(5)  tangible personal property not otherwise exempted
	under Subsection (b) that is incorporated into real estate or into
	an improvement of real estate;
	(6)  tangible personal property that is rented or
	leased for a term of one year or less; or
	(7)  notwithstanding Section 151.3111, a taxable
	service that is performed on tangible personal property exempted
	under this section, other than a charge for labor to install or
	maintain tangible personal property described by Subsection (b)
	that is separately itemized.
	(d)  Subject to Subsection (k), a data center may be
	certified by the comptroller as a qualifying data center for
	purposes of this section if, on or after September 1, 2013, [:
	[(1)  a single qualifying occupant:
	[(A)     contracts with a qualifying owner or
	qualifying operator to lease space in which the qualifying occupant
	will locate a data center; or
	[(B)     occupies a space that was not previously
	used as a data center in which the qualifying occupant will locate a
	data center, in the case of a qualifying occupant who is also the
	qualifying operator and the qualifying owner; and
	[(2)]  the qualifying owner, qualifying operator, or
	qualifying occupants of the data center [occupant], jointly or
	independently:
	(1)  create [(A)  creates] at least five [20]
	qualifying jobs in the county in which the data center is located,
	not including jobs moved from one county in this state to another
	county in this state; and
	(2)  make or agree [(B)  makes or agrees] to make a
	capital investment, on or after September 1, 2013, of at least $100
	[$200] million in that particular data center over a five-year
	period beginning on the date the data center is certified by the
	comptroller as a qualifying data center.
	(e)  A data center that is eligible under Subsection (d) to
	be certified by the comptroller as a qualified data center shall
	apply to the comptroller for certification as a qualifying data
	center and for issuance of a registration number or numbers by the
	comptroller.  The application must be made on a form prescribed by
	the comptroller and include the information required by the
	comptroller.  The application must include the name and contact
	information for each [the] qualifying occupant, if any, as of the
	date on which the application is filed with the comptroller, and [,
	if applicable,] the name and contact information for the qualifying
	owner and, if applicable, the qualifying operator who will claim
	the exemption authorized under this section.  The application form
	must include a section for the applicant to certify that the capital
	investment required by Subsection (d)(2) [Subsection (d)(2)(B)]
	will be met independently or jointly by the [qualifying occupant,]
	qualifying owner, [or] qualifying operator, or qualifying
	occupants within the time period prescribed by that subsection
	[Subsection (d)(2)(B)].
	(e-1)  A person who is not listed as a qualifying occupant on
	an application filed under Subsection (e) may submit an application
	to the comptroller for a registration number in relation to a
	certified qualifying data center on a form prescribed by the
	comptroller. The comptroller shall issue the registration number
	to the applicant on receipt of information sufficient for the
	comptroller to determine that the applicant is a qualifying
	occupant of the certified qualifying data center.
	(f)  The exemption provided by this section begins on the
	date the data center is certified by the comptroller as a qualifying
	data center and expires:
	(1)  on the 10th anniversary of that date, if the
	qualifying owner, qualifying operator [occupant, qualifying
	owner], or qualifying occupants, [operator] independently or
	jointly, make [makes] a capital investment of at least $100 [$200]
	million but less than $150 [$250] million as provided by Subsection
	(d)(2) [Subsection (d)(2)(B)]; or
	(2)  on the 15th anniversary of that date, if the
	qualifying owner, qualifying operator [occupant, qualifying
	owner], or qualifying occupants, [operator] independently or
	jointly, make [makes] a capital investment of $150 [$250] million
	or more as provided by Subsection (d)(2) [Subsection (d)(2)(B)].
	(l)  A qualifying owner, qualifying operator, or qualifying
	occupant of a qualifying data center may apply to the comptroller
	for a refund of the taxes imposed by this chapter paid on the
	purchase of an item of tangible personal property described by
	Subsection (b) that occurred before the date the qualifying data
	center is certified by the comptroller if the item was purchased
	after the earlier of:
	(1)  the date the data center submits the application
	described by Subsection (e); or
	(2)  the 180th day before the date the data center is
	certified by the comptroller.
	SECTION 3.  The changes in law made by this Act apply to a
	data center certified as a qualifying data center by the
	comptroller of public accounts, regardless of whether the
	certification occurred before, on, or after the effective date of
	this Act.
	SECTION 4.  This Act takes effect September 1, 2015.