LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 76th Regular Session April 21, 1999 TO: Honorable Bill Ratliff, Chair, Senate Committee on Finance FROM: John Keel, Director, Legislative Budget Board IN RE: HB844 by Wilson (Relating to the total amount of state lottery prizes that may be awarded in a fiscal year.), As Engrossed ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Funds for * * HB844, As Engrossed: positive impact of $30,017,000 through the * * biennium ending August 31, 2001. * ************************************************************************** General Revenue-Related Funds, Five-Year Impact: **************************************************** * Fiscal Year Probable Net Positive/(Negative) * * Impact to General Revenue Related * * Funds * * 2000 $(10,169,000) * * 2001 40,186,000 * * 2002 40,788,000 * * 2003 41,401,000 * * 2004 42,023,000 * **************************************************** All Funds, Five-Year Impact: ***************************************************** * Fiscal Year Probable Revenue Gain/(Loss) from * * Foundation School Fund * * 0193 * * 2000 $(10,169,000) * * 2001 40,186,000 * * 2002 40,788,000 * * 2003 41,401,000 * * 2004 42,023,000 * ***************************************************** Fiscal Analysis The bill would amend the Government Code to repeal the statutory limitation on the total amount of prizes that can be awarded by the lottery each fiscal year. The bill would take effect September 1, 1999. Methodology The bill would repeal Section 466.015(d) of the Government Code, which limits the amount paid out in prizes each fiscal year to the gross sales for that year times the percent paid in fiscal 1997, less 5 percent of the gross sales in that fiscal year. This estimate assumes that the Texas Lottery Commission would return to the prize percentages paid in fiscal 1997. This estimate also assumes that there would be an increase in sales as a behavioral response by players. The estimate assumes that there would be a modest loss to the state in fiscal 2000 because the state's share of lottery sales would be reduced. This would be offset in later years due to the projected increase in total sales. Local Government Impact No fiscal implication to units of local government is anticipated. Source Agencies: 362 Texas Lottery Commission, 304 Comptroller of Public Accounts LBB Staff: JK, SD, TH, WP, PH