LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 76th Regular Session March 26, 1999 TO: Honorable Steven Wolens, Chair, House Committee on State Affairs FROM: John Keel, Director, Legislative Budget Board IN RE: HB3135 by Reyna, Arthur (relating to state funding and agreements supporting the bids of certain municipalities or counties to host the 2007 Pan American Games; providing a penalty), As Introduced ************************************************************************** * Estimated Two-Year Net Impact to General Revenue Related Fundsfor * * HB3135, As Introduced: $0 through the biennium ending August 31, * * 2001. * * * * The bill would make no appropriation but could provide the legal * * basis for an appropriation of funds to implement the provisions of * * the bill. * ************************************************************************** General Revenue-Related Funds, Five-Year Net Impact: **************************************************** * Fiscal Year Probable Net Positive/(Negative) * * Impact to General Revenue Related * * Funds * * 2000 $0 * * 2001 0 * * 2002 0 * * 2003 0 * * 2004 0 * **************************************************** All Funds, Five-Year Impact: *************************************************************************** *Fiscal Probable Savings/(Cost) from Probable Revenue Gain/(Loss) * * Year New - GR Dedicated from New - GR Dedicated * * 2000 $0 $0 * * 2001 0 0 * * 2002 (4,100,000) 4,100,000 * * 2003 (4,100,000) 4,100,000 * * 2004 (4,100,000) 4,100,000 * *************************************************************************** Fiscal Analysis The bill would provide a method of financing to certain local entities to assist in the designation, preparation, and production of the 2007 Pan American Games. If a Texas city were to be selected to host the games, the Comptroller would be required to determine the incremental increase in the state sales and use tax receipts reasonably attributable to all phases of the games within that city's market area for each calendar month. The Comptroller would be required to deposit the estimated amount of increased revenue into a new, special account in the Texas Department of Economic Development's (TDED) treasury account, to be called the GR-Account Pan American Games Support. Deposits would cease three months following the closing event of the games. TDED could use the account to provide assurances to a site selection organization, or to assist with costs of presenting the games. The bill would also require the TDED to review requests from qualified applicants for support of local efforts to host the Pan American Games within 30 days, based on the reasonableness of the plan and the applicant's ability to reimburse the department for its costs. The bill would also allow the Department of Transportation, Department of Public Safety, and Department of Housing and Community Affairs to assist qualified applicants in developing applications for the games and/or hosting the games. Methodology Administrative duties required of the TDED could be completed with current appropriations and within existing agency staffing levels. According to the United States Olympic Committee, San Antonio is the only city in Texas under consideration to host the Pan American Games in 2007; this estimate assumes that San Antonio would be chosen as the host city. Should San Antonio not be chosen to host the games, there would be no fiscal impact. Indianapolis hosted the games in 1987 and experienced an increase in local sales tax revenue attributable to the games of approximately four tenths of one percent (.004). A similar increase in San Antonio would generate an additional $4.1 million in revenue deposited to the dedicated account; this estimate assumes that all funds deposited to the account would be spent. Local Government Impact Local governments creating a regional games authority could incur administrative and operational expenses. The cost to each local government would depend on the terms of the resolution creating the authority. Source Agencies: LBB Staff: JK, BB, DP