TITLE 34.PUBLIC FINANCE

Part 1. COMPTROLLER OF PUBLIC ACCOUNTS

Chapter 3. TAX ADMINISTRATION

Subchapter Z. COASTAL PROTECTION FEE

34 TAC §3.692

The Comptroller of Public Accounts proposes an amendment to §3.692, concerning definitions, reporting requirements and amount of fee. This section is being amended pursuant to Senate Bill 1863, 79th Legislature, 2005. Senate Bill 1863 changed language to reduce the rate of the fee and reduce the maximum and minimum thresholds for the Coastal Protection Fund (Natural Resources Code, §40.155(a), (b)).

John Heleman, Chief Revenue Estimator, has determined that for the first five-year period the amendment will be in effect, there will be no significant revenue impact on the state or units of local government.

Mr. Heleman also has determined that for each year of the first five years the amendment is in effect, the public benefit anticipated as a result of enforcing the amended rule will be in providing correct information to fee payers and collectors regarding their responsibilities. This rule is adopted under Tax Code, Title 2, and does not require a statement of fiscal implications for small businesses. There is no significant anticipated economic cost to individuals who are required to comply with the proposed amendment.

Comments on the proposal may be submitted to Bryant K. Lomax, Manager, Tax Policy Division, P.O. Box 13528, Austin, Texas 78711-3528.

The amendment is proposed under Tax Code, §111.002 and §111.0022, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of Tax Code, Title 2, and taxes, fees, or other charges which the comptroller administers under other law.

The amendment implements Natural Resource Code, §40.155.

§3.692.Definitions, Reporting Requirements and Amount of Fee [ (Natural Resources Code, §40.155 and §40.156) ].

(a) (No change.)

(b) Reporting requirements.

(1) Each marine terminal operator, or owner of crude oil who is registered with the comptroller to report the fee, shall file a coastal protection fee report with the comptroller stating the number of barrels of crude oil and condensate off-loaded from vessels or loaded onto vessels at marine terminals located in Texas. The volume shall be determined by tank tables compiled to show 100% of the full capacity of the tank or by use of industry standard automatic measuring equipment, and shall be corrected to 60 degrees Fahrenheit [ F ]. The volume may be reduced by a reasonable allowance for basic sediment and water as determined by tests generally recognized by the industry to be accurate.

(2) - (3) (No change.)

(c) Amount of fee.

(1) Except as provided in paragraphs (2) and (4) of this subsection, the rate of the fee will be $.01333 [ $.02 ] per barrel of crude oil or condensate.

(2) When the balance in the coastal protection fund has reached $20 [ $25 ] million, the commissioner of the General Land Office will certify that fact to the comptroller. The fee will not be collected or required to be paid on or after the first day of the second month following the commissioner's certification to the comptroller.

(3) If the commissioner of the General Land Office certifies to the comptroller that the balance of the coastal protection fund has fallen below $10 [ $14 ] million, the fee will again be due at the rate of $.01333 [ $.02 ] per barrel.

(4) The rate of the fee will be $.04 per barrel of crude oil or condensate when:

(A) the commissioner of the General Land Office certifies to the comptroller that:

(i) the balance in the coastal protection fund is less than $20 [ $25 ] million; and

(ii) - (iii) (No change.)

(B) The fee will not be collected or required to be paid on or after the first day of the second month following the commissioner's certification to the comptroller that the balance in the coastal protection fund has reached:

(i) $20 [ $25 ] million; or

(ii) (No change.)

(5) (No change.)

(d) (No change.)

(e) Penalty. Penalties due on delinquent fees and reports will be imposed as provided by [ the ] Tax Code, §111.061.

(f) Interest. Interest due on delinquent fees will be imposed as provided by [ the ] Tax Code, §111.060.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on June 20, 2006.

TRD-200603372

Martin Cherry

Chief Deputy General Counsel

Comptroller of Public Accounts

Earliest possible date of adoption: August 6, 2006

For further information, please call: (512) 475-0387