CHAPTER 327. MUNICIPAL SALES AND USE TAX FOR STREET MAINTENANCE
TAX CODE
TITLE 3. LOCAL TAXATION
SUBTITLE C. LOCAL SALES AND USE TAXES
CHAPTER 327. MUNICIPAL SALES AND USE TAX FOR STREET MAINTENANCE
Sec. 327.001. DEFINITION. In this chapter, "municipal street"
means the entire width of a way held by a municipality in fee or
by easement or dedication that has a part open for public use for
vehicular travel. The term does not include a designated state or
federal highway or road or a designated county road.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001.
Sec. 327.002. MUNICIPAL SALES AND USE TAX ACT APPLICABLE.
Except to the extent that a provision of this chapter applies,
Chapter 321 applies to the tax authorized by this chapter in the
same manner as that chapter applies to the tax authorized by that
chapter.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001.
Sec. 327.003. TAX AUTHORIZED. (a) A municipality may adopt the
sales and use tax authorized by this chapter at an election held
in the municipality.
(b) A municipality may not adopt a tax under this chapter or
increase the rate of the tax if as a result of the adoption of
the tax or the increase in the rate of the tax the combined rate
of all sales and use taxes imposed by the municipality and other
political subdivisions of this state having territory in the
municipality would exceed two percent at any location in the
municipality.
(c) If the voters of a municipality approve the adoption of the
tax or the increase in the rate of the tax at an election held on
the same election date on which another political subdivision
adopts a sales and use tax or approves the increase in the rate
of its sales and use tax and as a result the combined rate of all
sales and use taxes imposed by the municipality and other
political subdivisions of this state having territory in the
municipality would exceed two percent at any location in the
municipality, the election to adopt a sales and use tax under
this chapter has no effect.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001. Amended by Acts 2003, 78th Leg., ch. 403, Sec. 1, eff. June
20, 2003.
Sec. 327.004. TAX RATE. The tax authorized by this chapter may
be imposed at the rate of one-eighth of one percent or one-fourth
of one percent.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001. Amended by Acts 2003, 78th Leg., ch. 403, Sec. 2, eff. June
20, 2003.
Sec. 327.005. SALES AND USE TAX EFFECTIVE DATE. (a) The
adoption of the tax or the change in the rate of the tax takes
effect on the first day of the first calendar quarter occurring
after the expiration of the first complete calendar quarter
occurring after the date on which the comptroller receives notice
of the results of the election.
(b) If the comptroller determines that an effective date
provided by Subsection (a) will occur before the comptroller can
reasonably take the action required to begin collecting the tax,
the effective date may be extended by the comptroller until the
first day of the next succeeding calendar quarter.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001. Amended by Acts 2003, 78th Leg., ch. 403, Sec. 3, eff. June
20, 2003.
Sec. 327.006. ELECTION PROCEDURE. (a) An election to adopt the
tax authorized by this chapter is called by the adoption of an
ordinance by the governing body of the municipality.
(b) At an election to adopt the tax, the ballot shall be
prepared to permit voting for or against the proposition: "The
adoption of a local sales and use tax in (name of municipality)
at the rate of (insert one-eighth of one percent or one-fourth of
one percent) to provide revenue for maintenance and repair of
municipal streets."
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001. Amended by Acts 2003, 78th Leg., ch. 403, Sec. 4, eff. June
20, 2003.
Sec. 327.0065. RATE CHANGE. (a) A municipality that has
adopted a sales and use tax under this chapter at a rate of
one-fourth of one percent may by ordinance decrease the rate of
the tax to one-eighth of one percent.
(b) A municipality that has adopted a sales and use tax under
this chapter at a rate of one-eighth of one percent may by
ordinance increase the rate of the tax to one-fourth of one
percent if the increase is authorized at an election held in the
municipality.
(c) The ballot for an election to increase the tax shall be
printed to permit voting for or against the proposition: "The
adoption of a local sales and use tax in (name of municipality)
at the rate of one-fourth of one percent to provide revenue for
maintenance and repair of municipal streets."
Added by Acts 2003, 78th Leg., ch. 403, Sec. 5, eff. June 20,
2003.
Sec. 327.007. REAUTHORIZATION OF TAX. (a) Unless imposition of
the sales and use tax authorized by this chapter is reauthorized
as provided by this section, the tax expires on:
(1) the fourth anniversary of the date the tax originally took
effect under Section 327.005; or
(2) the first day of the first calendar quarter occurring after
the fourth anniversary of the date the tax was last reauthorized
under this section.
(b) An election to reauthorize the tax is called and held in the
same manner as an election to adopt the tax under Section
327.006, except the ballot proposition shall be prepared to
permit voting for or against the proposition: "The
reauthorization of the local sales and use tax in (name of
municipality) at the rate of (insert appropriate rate) to
continue providing revenue for maintenance and repair of
municipal streets."
(c) If an election to reauthorize the tax is not held before the
tax expires as provided by Subsection (a), or if a majority of
the votes cast in an election to reauthorize the tax do not favor
reauthorization, the municipality may not call an election on the
question of authorizing a new tax under this chapter before the
first anniversary of the date on which the tax expired.
(d) Not later than the 10th day after the date the municipality
determines that the tax will expire as provided by Subsection
(a), the municipality shall notify the comptroller of the
scheduled expiration. The comptroller may delay the scheduled
expiration date if the comptroller notifies the municipality that
more time is required. The comptroller must provide a new
expiration date that is not later than the last day of the first
calendar quarter occurring after the notification to the
comptroller.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001. Amended by Acts 2003, 78th Leg., ch. 403, Sec. 6, eff. June
20, 2003.
Sec. 327.008. USE OF TAX REVENUE. Revenue from the tax imposed
under this chapter may be used only to maintain and repair
municipal streets existing on the date of the election to adopt
the tax.
Added by Acts 2001, 77th Leg., ch. 464, Sec. 1, eff. June 11,
2001.