LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 12, 2025 TO: Honorable Phil King, Chair, Senate Committee on Economic Development FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2955 by Parker (Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for SB2955, As Introduced: an impact of $0 through the biennium ending August 31, 2027. However, the impact would become negative in fiscal year 2028 and continue for 10 years. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2026$02027$02028($1,121,000)2029($1,271,000)2030($1,322,000)All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund12026$02027$02028($1,121,000)2029($1,271,000)2030($1,322,000) Fiscal AnalysisThe bill would to add a municipality with a population of 16,000 or more that is located entirely within a county with a population of 2.6 million or more and that is labeled as a town in the most recent United States Census, to the list of municipalities that are entitled to receive certain tax revenue derived from a hotel and convention center project and to pledge certain revenue for the payment of obligations related to the project.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 12, 2025
TO: Honorable Phil King, Chair, Senate Committee on Economic Development FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2955 by Parker (Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.), As Introduced
TO: Honorable Phil King, Chair, Senate Committee on Economic Development
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: SB2955 by Parker (Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.), As Introduced
Honorable Phil King, Chair, Senate Committee on Economic Development
Honorable Phil King, Chair, Senate Committee on Economic Development
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
SB2955 by Parker (Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.), As Introduced
SB2955 by Parker (Relating to the authority of certain municipalities to receive certain tax revenue derived from a hotel and convention center project and to pledge certain tax revenue for the payment of obligations related to the project.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB2955, As Introduced: an impact of $0 through the biennium ending August 31, 2027. However, the impact would become negative in fiscal year 2028 and continue for 10 years.
Estimated Two-year Net Impact to General Revenue Related Funds for SB2955, As Introduced: an impact of $0 through the biennium ending August 31, 2027. However, the impact would become negative in fiscal year 2028 and continue for 10 years.
General Revenue-Related Funds, Five- Year Impact:
2026 $0
2027 $0
2028 ($1,121,000)
2029 ($1,271,000)
2030 ($1,322,000)
All Funds, Five-Year Impact:
2026 $0
2027 $0
2028 ($1,121,000)
2029 ($1,271,000)
2030 ($1,322,000)
Fiscal Analysis
The bill would to add a municipality with a population of 16,000 or more that is located entirely within a county with a population of 2.6 million or more and that is labeled as a town in the most recent United States Census, to the list of municipalities that are entitled to receive certain tax revenue derived from a hotel and convention center project and to pledge certain revenue for the payment of obligations related to the project.
Methodology
The bill's provisions would affect the town of Addison.Addison would be entitled to receive from the qualified hotel and each restaurant, bar, and retail establishment located in or connected to the hotel or the related qualified convention center facility, the state sales and use tax and the state hotel occupancy tax. Section 351.157(d) of the Tax Code provides, in relevant part, that a municipality to which the section applies is entitled to receive the revenue derived from the state sales and use taxes, and local mixed beverage taxes generated, paid, and collected from a qualified establishment. Addison would be entitled to receive the revenue until the tenth anniversary of the date the qualified hotel to which the entitlement relates is open for initial occupancy.The town of Addison has plans for a qualified hotel, but due to Section 351.157(e), which requires a municipality to commence a project before September 1, 2027, to receive additional entitlements from restaurants, bars, retail establishments, swimming pools and swimming facilities as provided under Section 351.157, the city could only avail itself of the tax rebates under section 351.156 should eligibility be acquired through this legislation. The estimate is based on a projected opening date of October 1, 2027, or state fiscal year 2028, a comparison and review of revenues paid to the owners of extant qualified hotel projects, and estimated attributes of such prospective hotel.
Local Government Impact
Addison would be entitled to receive from the qualified hotel and each restaurant, bar, and retail establishment located in or connected to the hotel or the related qualified convention center facility, the state sales and use tax and the state hotel occupancy tax.
Source Agencies: b > td > 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: b > td > JMc, RStu, SD, BRI
JMc, RStu, SD, BRI