LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION March 9, 2015 TO: Honorable Troy Fraser, Chair, Senate Committee on Natural Resources & Economic Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB749 by Hinojosa (Relating to the allocation of state hotel occupancy tax revenue to certain barrier island coastal municipalities.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for SB749, As Introduced: a negative impact of ($1,849,000) through the biennium ending August 31, 2017.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION
March 9, 2015
TO: Honorable Troy Fraser, Chair, Senate Committee on Natural Resources & Economic Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB749 by Hinojosa (Relating to the allocation of state hotel occupancy tax revenue to certain barrier island coastal municipalities.), As Introduced
TO: Honorable Troy Fraser, Chair, Senate Committee on Natural Resources & Economic Development
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: SB749 by Hinojosa (Relating to the allocation of state hotel occupancy tax revenue to certain barrier island coastal municipalities.), As Introduced
Honorable Troy Fraser, Chair, Senate Committee on Natural Resources & Economic Development
Honorable Troy Fraser, Chair, Senate Committee on Natural Resources & Economic Development
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
SB749 by Hinojosa (Relating to the allocation of state hotel occupancy tax revenue to certain barrier island coastal municipalities.), As Introduced
SB749 by Hinojosa (Relating to the allocation of state hotel occupancy tax revenue to certain barrier island coastal municipalities.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB749, As Introduced: a negative impact of ($1,849,000) through the biennium ending August 31, 2017.
Estimated Two-year Net Impact to General Revenue Related Funds for SB749, As Introduced: a negative impact of ($1,849,000) 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 ($867,000) 2017 ($982,000) 2018 ($1,036,000) 2019 ($1,090,000) 2020 ($1,148,000)
2016 ($867,000)
2017 ($982,000)
2018 ($1,036,000)
2019 ($1,090,000)
2020 ($1,148,000)
All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromCity of Port Aransas Probable Revenue Gain/(Loss) fromCity of Corpus Christi 2016 ($867,000) $652,000 $215,000 2017 ($982,000) $753,000 $229,000 2018 ($1,036,000) $794,000 $242,000 2019 ($1,090,000) $836,000 $254,000 2020 ($1,148,000) $880,000 $268,000
Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromCity of Port Aransas Probable Revenue Gain/(Loss) fromCity of Corpus Christi 2016 ($867,000) $652,000 $215,000 2017 ($982,000) $753,000 $229,000 2018 ($1,036,000) $794,000 $242,000 2019 ($1,090,000) $836,000 $254,000 2020 ($1,148,000) $880,000 $268,000
2016 ($867,000) $652,000 $215,000
2017 ($982,000) $753,000 $229,000
2018 ($1,036,000) $794,000 $242,000
2019 ($1,090,000) $836,000 $254,000
2020 ($1,148,000) $880,000 $268,000
Fiscal Analysis
The bill would amend Section 156.2512 of the Tax Code, regarding the allocation of state hotel occupancy revenue to certain barrier island coastal municipalities. The bill would increase the rate of the state hotel occupancy tax that eligible barrier island municipalities receive from one percent to two percent for all such municipalities, excluding revenue derived from the collection of taxes from a qualified hotel project. Additionally, the definition of an eligible barrier island coastal municipality would be amended to include a municipality the boundaries of which include an institution of higher education that is part of the Texas Coastal Ocean Observation Network under Section 33.065 of the Natural Resources Code. That provision would add the city of Corpus Christi as an eligible barrier island municipality, joining Port Aransas and South Padre Island. The bill would take effect September 1, 2015.
Methodology
The bill's provisions would add Corpus Christi as an eligible barrier island municipality, but only hotels located on the barrier island of Corpus Christi would receive the 2% allocation. The bill's provisions would also increase the current allocation to Port Aransas by an additional one percent. Data on taxable hotel receipts was multiplied by the percentage increase in the state hotel occupancy tax rate for each city to estimate the loss to the General Revenue Fund and the gains to the cities. The fiscal impact was then adjusted for the bill's effective date, and extrapolated through 2020.
Local Government Impact
The fiscal impact to local government is illustrated in the above table.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: UP, SZ, SD, AG
UP, SZ, SD, AG