LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION May 9, 2015 TO: Honorable Dennis Bonnen, Chair, House Committee on Ways & Means FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB2492 by Darby (relating to an exemption from the sales tax for certain water-efficient products for a limited period.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for HB2492, Committee Report 1st House, Substituted: a negative impact of ($7,730,000) through the biennium ending August 31, 2017.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION
May 9, 2015
TO: Honorable Dennis Bonnen, Chair, House Committee on Ways & Means FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB2492 by Darby (relating to an exemption from the sales tax for certain water-efficient products for a limited period.), Committee Report 1st House, Substituted
TO: Honorable Dennis Bonnen, Chair, House Committee on Ways & Means
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: HB2492 by Darby (relating to an exemption from the sales tax for certain water-efficient products for a limited period.), Committee Report 1st House, Substituted
Honorable Dennis Bonnen, Chair, House Committee on Ways & Means
Honorable Dennis Bonnen, Chair, House Committee on Ways & Means
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
HB2492 by Darby (relating to an exemption from the sales tax for certain water-efficient products for a limited period.), Committee Report 1st House, Substituted
HB2492 by Darby (relating to an exemption from the sales tax for certain water-efficient products for a limited period.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for HB2492, Committee Report 1st House, Substituted: a negative impact of ($7,730,000) through the biennium ending August 31, 2017.
Estimated Two-year Net Impact to General Revenue Related Funds for HB2492, Committee Report 1st House, Substituted: a negative impact of ($7,730,000) through the biennium ending August 31, 2017.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2016 ($3,700,000) 2017 ($4,030,000) 2018 ($4,200,000) 2019 ($4,370,000) 2020 ($4,540,000)
2016 ($3,700,000)
2017 ($4,030,000)
2018 ($4,200,000)
2019 ($4,370,000)
2020 ($4,540,000)
All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2016 ($3,700,000) ($710,000) ($230,000) ($150,000) 2017 ($4,030,000) ($720,000) ($230,000) ($150,000) 2018 ($4,200,000) ($740,000) ($240,000) ($160,000) 2019 ($4,370,000) ($840,000) ($260,000) ($160,000) 2020 ($4,540,000) ($850,000) ($260,000) ($160,000)
Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2016 ($3,700,000) ($710,000) ($230,000) ($150,000) 2017 ($4,030,000) ($720,000) ($230,000) ($150,000) 2018 ($4,200,000) ($740,000) ($240,000) ($160,000) 2019 ($4,370,000) ($840,000) ($260,000) ($160,000) 2020 ($4,540,000) ($850,000) ($260,000) ($160,000)
2016 ($3,700,000) ($710,000) ($230,000) ($150,000)
2017 ($4,030,000) ($720,000) ($230,000) ($150,000)
2018 ($4,200,000) ($740,000) ($240,000) ($160,000)
2019 ($4,370,000) ($840,000) ($260,000) ($160,000)
2020 ($4,540,000) ($850,000) ($260,000) ($160,000)
Fiscal Analysis
The bill would amend Chapter 151 of the Tax Code, regarding the sales and use tax, to provide for a sales tax holiday for certain water efficient products. The bill would add new Section 151.3335 to provide a "WaterSense product" as certified under the U.S. Environmental Protection Agency WaterSense program, would be exempt from the sales and use tax during the period beginning at 12:01 a.m. on the Saturday preceding the last Monday in May (Memorial Day) and ending at 11:59 p.m. on the last Monday in May. This bill would take effect July 1, 2015, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2015.
Methodology
The bill would amend Chapter 151 of the Tax Code, to provide for an exemption from sales and use tax of certain water-efficient products for a limited period. The bill would add Section 151.3335 to provide that a water-conserving product or WaterSense product would be exempt from the sales and use tax during the period beginning at 12:01 a.m. on the Saturday preceding the last Monday in May (Memorial Day) and ending at 11:59 p.m. on the last Monday in May. "Water-conserving product" would be defined as tangible personal property used outdoors on private residential property and not in a business or trade that may result in water conservation or groundwater retention, water table recharge, or a decrease in evaporation. The term would include a soaker or drip irrigation hose, a moisture control for sprinkler or irrigation systems, mulch, a rain barrel or alternative moisture control system, and a permeable ground cover surface. A "WaterSense product" would be as certified under the U.S. Environmental Protection Agency WaterSense program. The bill would take effect July 1, 2015, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2015.
Local Government Impact
There would be a proportional loss of sales and use tax revenue from local taxing jurisdictions as shown in the above table.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: UP, KK, SD
UP, KK, SD