HBA-SEP H.B. 1326 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1326 By: Brimer Economic Development 3/20/2001 Introduced BACKGROUND AND PURPOSE Current law imposes an unemployment insurance tax rate of two and seven tenths percent on companies that have yet to establish an unemployment experience rating. This tax rate may be burdensome to new businesses that already have high start-up costs. House Bill 1326 reduces an employer's initial contribution rate to one and five tenths percent. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 1326 amends the Labor Code to redefine a person's contribution rate to the unemployment compensation fund for the calendar year in which the person becomes an employer as one and five tenths percent, instead of the greater of two and seven tenths percent or the rate established for that year for the major group to which the employer is assigned. The bill also repeals provisions for assignment to a major group and establishment of a major group contribution rate. EFFECTIVE DATE September 1, 1999 and applies beginning January 1, 2000.