TITLE public-finance

Part I. Comptroller of Public Accounts

Chapter 3. Tax Administration

Subchapter C. Crude Oil Production Tax

34 TAC §3.35

The Comptroller of Public Accounts proposes an amendment to §3.35, concerning reporting requirements for producers and purchasers. This section is being amended pursuant to prior legislation and to clarify reporting requirements. Subsection (h) is being amended to clarify reporting requirements for purchasers. Subsection (k) is being amended to change reporting requirements from county level reporting to lease level reporting. A new subsection (k)(1)(C) is being added to clarify reporting requirements for oil where the producer and purchaser are the same entity. Subsection (k)(3) and (k)(4) are being amended to correct references to information to be included on the Crude Oil Special Report and records to be maintained by operators or producers not required to file reports.

James LeBas, 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 local government.

Mr. LeBas 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 adopting the amendment will be in providing more detailed reporting of the Oil Production Tax. This amendment is adopted under the 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.

This amendment is proposed under the Tax Code, §111.002, which provides the comptroller with the authority to prescribe, adopt, and enforce rules relating to the administration and enforcement of the provisions of the Tax Code, Title 2.

The amendment implements the Tax Code, §202.201 and §202.202.

§3.35.Reporting Requirements for Producers and Purchasers.

(a)-(b)

(No change.)

(c)

Any oil used, lost, stolen, or otherwise unaccounted for after it has been produced and measured must be reported, and the tax must be paid by the operator on the Crude Oil Special Tax Report [ crude oil special tax report ], unless the operator is required to file the Crude Oil Producer's Monthly Tax Report [ crude oil producer's monthly tax report ].

(d)-(g)

(No change.)

(h)

All first purchasers of crude oil must file the Crude Oil Purchaser's Monthly Tax Report[ , if not filing a Crude Oil Producer's Monthly Tax Report ].

(i)

All operators or producers authorized to remit and responsible for remitting tax, other than the operators authorized [ tax due ] under subsection (c) of this section, must file the Crude Oil Producer's Monthly Tax Report.

(j)

(No change.)

(k)

Beginning with the January 1999 production period, crude oil production will be reported at the lease level on all crude oil reports. The following information must be reported on the crude oil reports:

(1)

the Crude Oil Purchaser's Monthly Tax Report:

(A)

the name and taxpayer number of each operator or producer from whom crude oil was purchased during the month; and

(B)

the volume and value of oil purchased from each operator or producer on each lease [ in each county ]; except

(C)

oil produced and purchased by the same taxpayer must be reported only on the Crude Oil Producer's Monthly Tax Report.

(2)

the Crude Oil Producer's Monthly Tax Report:

(A)

the name and taxpayer number of the purchaser of oil being sold at the lease; and

(B)

the volume and value of oil used, lost, stolen , or removed from leases by the operator or producer on each lease [ in each county ]; and

(3)

the Crude Oil Special Tax Report. The volume and value of all oil lost, used, stolen, or otherwise unaccounted for on each lease [ in each county ] (to be used by producers who are not required to file reports under subsection (i) [ (f) ] of this section) . [ ; ]

(l)

[ (4) ] [ crude oil operators or producers. ] Crude oil operators or producers who are not required to file reports under [ subsection (f) of ] this section must keep the following records:

(1)

[ (A) ] the name and taxpayer number of each purchaser taking delivery of oil at the lease from the operator or producer during the previous calendar year; and

(2)

[ (B) ] the total volume and value of the oil delivered to each purchaser.

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 April 26, 1999.

TRD-9902444

Martin Cherry

Special Counsel

Comptroller of Public Accounts

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 463-4062


Chapter 7. Prepaid Higher Education Tuition Program

Subchapter I. Refunds, Termination

34 TAC §7.81

The Comptroller of Public Accounts proposes an amendment to §7.81, concerning the administration of the prepaid higher education tuition program.

These changes are proposed to conform certain provisions requested by the Internal Revenue Service in connection with the Program's application for a private letter ruling on the Program's tax status.

James LeBas, 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 local government.

Mr. LeBas 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 adopting the amendment will be in refunds to purchasers in the event that a prepaid tuition contract is terminated after the beneficiary reaches age 18. This amendment is adopted under the 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 Aaron Demerson, Manager, Texas Tomorrow Fund, P.O. Box 13407, Austin, Texas 78711-3407.

The amended rule is proposed under the Education Code, §54.618, which gives the Prepaid Higher Education Tuition Board the authority to adopt rules to implement Subchapter F, Chapter 54, Education Code.

The amendment implements Education Code, §54.632.

§7.81.Refunds.

(a)-(c)

(No change.)

(d)

Examples of circumstances under these rules in which refunds may be made include, but are not limited to, the following.

(1)-(5)

(No change.)

(6)

If a prepaid tuition contract is terminated under §7.82(c) of this title (relating to Termination of Prepaid Tuition Contract), such contract may be refunded in an amount equal to the present lump sum actuarial value, as of the date of termination, of the average amount of tuition or the estimated amount of private tuition and required fees of junior college plans, junior/senior college plans or the estimated amount of private tuition and required fees for the private college plan, less the required penalty under §7.3(g) of this title (relating to Tax Exempt Status Requirements); a cancellation fee; and any other applicable fee. [ the lesser of: ]

[ (A)

the lowest amount of tuition and required fees among all institutions under the plan selected, but if a private college plan, such tuition and required fee amount shall not be less than the amount of payments made under the plan for tuition and required fees, less a cancellation fee and any other applicable fee; or ]

[ (B)

the amount of payments made under the plan for tuition and required fees; plus the average annual earnings rate on the fund, less 3.0%, but not to exceed 5.0% times the accumulated payments made under the contract as of December 31, of each year; less a cancellation fee and any other applicable fee. Any such refund may be made in semiannual installments to the purchaser of the prepaid tuition contract; ]

[ (C) ]

In [ however, in ] no case shall a refund be made in an amount less than the total amount paid by the purchaser under the contract less any applicable administrative fees or amounts previously distributed.

(7)-(8)

(No change.)

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 April 26, 1999.

TRD-9902447

Martin Cherry

Special Counsel

Comptroller of Public Accounts

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 463-4062


Part IV. Employees Retirement System of Texas

Chapter 73. Benefits

34 TAC §73.15

The Employees Retirement System of Texas proposes an amendment to §73.15, concerning Proportionate Retirement Program-Benefits. The amendment is being proposed in order to delete subsection (a).

William S. Nail, Deputy Executive Director and General Counsel has determined that for the first five-year period the rule is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the rule.

Mr. Nail also determined that for each year of the first five years the rule is in effect the public benefit anticipated as a result of enforcing the rule will be updated information. There will be no affect on small businesses. There are no anticipated economic costs to persons who are required to comply with the rule as proposed.

Comments on the proposed rule amendment may be submitted to William S. Nail, Deputy Executive Director and General Counsel, Employees Retirement System of Texas, P.O. Box 13207, Austin, Texas 78711-3207, or e-mail Mr. Nail at wnail@ers.state.tx.us.

The amendment is proposed under Texas Government Code §803.401, which provides authorization for the board to adopt rules for the administration of the Proportionate Retirement Program.

No other statutes are affected by this amendment.

§73.15.Proportionate Retirement Program-Benefits.

[(a)

When the length-of-service requirement for retirement is met by creditable service in more than one class or system, the member must complete retirement from each of the classes and systems in which the creditable service was established.]

(a)

[ (b) ] Actuarial reductions for each class of service are those which would be used if all service from which the member has retired or is retiring was credited in that class.

(b)

[ (c) ] A person retiring with less service than is required in the applicable formula to compute average salary shall have benefits based upon the average salary for the months for which credit was established.

(c)

[ (d) ] The procedures to implement these principles are prescribed in the document entitled "Computation of Proportional Retirement Benefits." This document, which is to be considered a part of this section for all purposes, may be obtained from the executive director, Employees Retirement System; P.O. Box 13207; Austin, Texas 78711-3207. The formulas apply only to computation of benefits in programs or systems in which the member does not meet the length-of-service requirement for retirements.

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 April 21, 1999.

TRD-9902374

Sheila W. Beckett

Executive Director

Employees Retirement System of Texas

Earliest possible date of adoption: June 6, 1999

For further information, please call: (512) 867-7125