LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  April 22, 1997
         
         
      TO: Honorable Rene Oliveira, Chair            IN RE:  Senate Bill No. 893, As Engrossed
          Committee on Economic Development                              By: Moncrief
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB893 ( Relating 
to certain convention center hotel facilities.) this office 
has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB893-As Engrossed   FN Revision 1
         
The bill could have a fiscal impact on the State.  However according 
to the Comptroller's office, these types of sales and use and 
hotel tax rebates have not been utilized to date and have not 
created a loss to the State.
         
FISCAL ANALYSIS

The fiscal impact on the state would vary 
depending on the number of hotel projects in enterprise zones 
in the additional five cities that would qualify under the provisions 
of the bill.  Such qualified hotel projects and businesses located 
in a qualified hotel project would receive a rebate of 100 percent 
of the sales and use taxes and 100 percent of the hotel occupancy 
taxes collected at these establishments.  To the extent that 
such sales and use taxes and hotel occupancy taxes are rebated, 
the state would bear a corresponding revenue loss. 
   


METHODOLOGY

Currently, 
the definition of convention center facilities in the hotel 
tax law includes hotels within 1,000 feet of a convention center 
owned by a city with a population of 1.5 million or more, and 
historic hotels within one mile of a convention center owned 
by a city with a population of 1.5 million or more.  Hotel tax 
revenue from these two types of hotels may be pledged by a city 
of population 1.5 million or more for the payment of bonds issued 
to acquire and construct a convention center hotel or to acquire, 
remodel or rehabilitate a historic hotel.  A hotel owned by 
a city with a population of 1.5 million or more is a qualified 
hotel project in an enterprise zone.

The bill would lower 
the city population bracket to 440,000 or more and include counties 
with a population of 440,000 or more in the hotel tax law and 
would allow the hotels to be within the same specified distance 
to a city-owned or county-owned convention center.  By lowering 
the population bracket, the City of Houston would be joined 
by the cities of Dallas, San Antonio, El Paso, Austin and Fort 
Worth.  The city population bracket would also be lowered to 
440,000 for a qualified hotel project in an enterprise zone.

LOCAL

The 
fiscal impact on units of local government would vary depending 
on which cities or counties would choose to finance convention 
center facilities through the municipal hotel tax.  
         
 
          
   Source:            Agencies:   304   Comptroller of Public Accounts
                                         
                      LBB Staff:   JK ,TH