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Item 8ACITY OF SOUTHLAKE MEMORANDUM October 15, 2013 To: Shana Yelverton, City Manager From: Alicia Richardson, City Secretary Subject: Consider Resolution No. 13-040, constitutional amendment proposition 3, authorizing a political subdivision to extend number of days that aircraft parts are exempt from ad valorem taxation. Action Requested: Consider Resolution No. 13-040. Background Information: The Texas Legislature, during their 83rd Regular Session approved ten joint resolutions proposing nine particular constitutional amendments to be considered by the voters. Pursuant to Section 3.003 of the Texas Election Code, Governor Rick Perry ordered a special election to be held throughout the State of Texas on November 5, 2013 to consider the proposed constitutional amendments. A copy of the proclamation ordering the special election is attached hereto. Proposition No. 3 — HJR 133 would authorize local political subdivisions to extend the length of time that aircraft parts could remain temporarily in this state before being subject to ad valorem taxation. Under current law, merchandise, wares, and goods (including aircraft parts) may remain in this state temporarily for up to 175 days before being subject to ad valorem taxation; the proposed amendment would permit taxing entities to extend the exemption up to 730 days after the date that a person acquired or imported aircraft parts in the state. The proposed amendment will appear on the ballot as follows: "The constitutional amendment to authorize a political subdivision of this state to extend the number of days that aircraft parts that are exempt from ad valorem taxation due to their location in this state for a temporary period may be located in this state for purposes of qualifying for the tax exemption." Financial Considerations: The City of Southlake could see a reduction, minimum if any, in tax revenue if currently or in the future Southlake has a business in this industry. Strategic Link: Non -applicable Citizen Input/ Board Review: Non -applicable Legal Review: Non -applicable Alternatives: None Supporting Documents: Resolution No. 13-040 Governor Proclamation Staff Recommendation: To discuss and consider Resolution No. 13-040. RESOLUTION NO. 13-040 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOUTHLAKE, TEXAS, SUPPORTING CONSTITUTIONAL AMENDMENT PROPOSITION 3, AUTHORIZING A POLITICAL SUBDIVISION TO EXTEND NUMBER OF DAYS THAT AIRCRAFT PARTS ARE EXEMPT FROM AD VALOREM TAXATION. WHEREAS, the Texas Legislature convened in January 2013; and WHEREAS, during the 83rd Regular Session, the legislature approved ten joint resolutions proposing nine particular constitutional amendments; and WHEREAS, proposed constitutional amendment No. 3 would authorize local political subdivisions to extend the length of time that aircraft parts could remain temporarily in this state before being subject to ad valorem taxation; and WHEREAS, under current law, merchandise, wares, and goods (including aircraft parts) may remain in this state temporarily for up to 175 days before being subject to ad valorem taxation; and WHEREAS, the proposed amendment would permit taxing entities to extend the exemption up to 730 days after the date that a person acquired or imported aircraft parts in the state. THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SOUTHLAKE, TEXAS, THAT: Section 1. The City Council supports the passage of Proposition 3 authorizing a political subdivision to extend number of days that aircraft parts are exempt from ad valorem taxation. Section 2. This resolution is hereby effective upon passage and approval by the City Council. PASSED AND APPROVED THIS THE 151" DAY OF October 2013. CITY OF SOUTHLAKE, TEXAS John C. Terrell Mayor ATTEST: Alicia Richardson, TRMC City Secretary