EXEMPTIONS FROM STATE REGULATION; SUSPENSION OF LOCAL REGULATION.

(a) A state agency may exempt from its regulation a qualified business, qualified employee, or qualified property in a readjustment zone if the exemption is consistent with:

(1) the purposes of this chapter; and

(2) the protection and promotion of the general health and welfare.

(b) A local government may suspend local regulation, including an ordinance, rule, or standard, relating to zoning, licensing, or building codes in a readjustment zone.

(c) An exemption from or suspension of regulation under this section must be adopted in the same manner that the regulation was adopted.

(d) The authorization provided by Subsection (a) or (b) does not apply to regulation:

(1) that relates to:

(A) civil rights;

(B) equal employment;

(C) equal opportunity;

(D) fair housing rights; or

(E) preservation of historical sites or historical artifacts;

(2) the relaxation of which is likely to harm the public safety or public health, including environmental health; or

(3) that is specifically imposed by law.

(e) For the purposes of this section, property is classified as qualified property if the property is:

(1) tangible personal property located in the readjustment zone that was acquired from the federal government by lease or deed or:

(A) acquired by a taxpayer not earlier than the 90th day before the date on which the area was designated as a readjustment zone; and

(B) used predominantly by the taxpayer in the active conduct of a trade or business;

(2) real property located in the readjustment zone that was acquired from the federal government by lease or deed or:

(A) acquired by a taxpayer not earlier than the 90th day before the date on which the area was designated as a readjustment zone and was used predominantly by the taxpayer in the active conduct of a trade or business; or

(B) the principal residence of the taxpayer on the date of the sale or exchange; or

(3) an interest in an entity that was certified as a qualified business under Section 2310.302 for the entity's most recent tax year ending before the date of the sale or exchange.