LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
March 30, 1999
TO: Honorable Bill Carter, Chair, House Committee on Urban
Affairs
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB 3705 by Van de Putte (Relating to the creation of an
advanced transportation district and authorizing the
imposition of a local sales and use tax for advanced
transportation and local development.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB3705, As Introduced: positive impact of $0 through the biennium *
* ending August 31, 2001. *
* *
* No significant fiscal implication to the State is anticipated. *
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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2000 $0 *
* 2001 0 *
* 2002 0 *
* 2003 0 *
* 2004 0 *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Revenue Revenue Revenue *
* from Transit Gain/(Loss) Gain/(Loss) Gain/(Loss) *
* Authorities from VIA from All VIA from Balcones *
* Metropolitan Cities and Heights Crime *
* Transit Bexar Control District *
* County--Local *
* Development *
* 2000 $(515,265) $4,973,512 $4,973,512 $(109,278) *
* 2001 0 29,841,069 29,841,069 (655,785) *
* 2002 0 29,841,069 29,841,069 (655,785) *
* 2003 0 29,841,069 29,841,069 (655,785) *
* 2004 0 29,841,069 29,841,069 (655,785) *
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*Fiscal Probable Revenue Gain/(Loss) Probable Revenue Gain/(Loss) *
* Year from Comal County from Guadalupe County *
* 2000 $(6,724) $(6,724) *
* 2001 (40,346) (40,346) *
* 2002 (40,346) (40,346) *
* 2003 (40,346) (40,346) *
* 2004 (40,346) (40,346) *
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Technology Impact
None.
Fiscal Analysis
The bill would allow the board of the VIA Metropolitan Transit (VIA)
authority to order an election to create an advanced transportation
district within the authority's boundaries and to impose a sales and use
tax at the rate of 0.25 percent until January 1, 2011 at which time the
rate would increase to 0.5 percent. The bill also would allow the board
to order an election to authorize an additional 0.25 percent sales and
use tax for local development, which would expire on January 1, 2011. The
authority would pay for the cost of an election.
If the majority of voters in the City of San Antonio would vote in favor
of the proposition to create a district, the district would be created.
If the majority of voters in any other municipality or unincorporated
area within the authority would vote in favor of the proposition, the
district would also include the territory of those entities favoring the
creation of the district. The authority would be required to provide at
least 120 days notice of the intention to call an election to create a
district to the governing bodies of each of the member municipalities and
to Bexar County.
If the majority of voters in the district would authorize the local
development sales and use tax, the tax would be effective throughout the
district, and the proceeds of the local development tax collected in a
participating unit would be distributed to the governing body of that
unit. The authority would be required to provide notice of the intention
to call such an election at least 240 days prior to the election.
In cases where the imposition of additional local sales and use tax by
the district would result in a total local sales tax of more than 2
percent, the election of a participating unit to join the district would
repeal all local sales and use taxes imposed by or within the unit,
except for the authority's sales and use tax and a municipal sales and
use tax of up to 1 percent.
Methodology
This analysis assumes that the board VIA Metropolitan Transit would call
an election both to create an advanced transportation district and to
impose the local development sales and use tax during fiscal year 2000,
and that the Comptroller of Public Accounts would receive a copy of the
order canvassing the election results prior to July 1, 2000. This
analysis assumes that all entities in each authority would vote in favor
of the creation of a district and the imposition of the local development
tax. It is assumed that the sales and use taxes would thus take effect
on July 1, 2000.
Assuming a median cost of a local election of $.52 per capita, as
determined by a recent survey of local governments, the cost of an
election to create an advanced transportation district is estimated at
$515,265 for VIA. This is based on a population of 990,895 in the
incorporated areas of VIA.
The Comptroller of Public Accounts' "Allocation Historical Summary" sales
tax data for calendar year 1998 was used in this analysis. It is assumed
that the 0.25 percent sales taxes of both the newly created advanced
transportation district and the local development tax would each generate
revenues equal to 50 percent of the amount of revenue the authority
collected in calendar year 1998, since the authority's current sales and
use tax rate is 0.5 percent.
The estimated revenue losses to Comal and Guadalupe counties are based on
the assumption that county taxes imposed within the City of Selma would
be repealed upon creation of an advanced transportation district. Tax
collections for the City of Selma were used to estimate county tax
collections, and, for the purposes of this analysis, it is assumed that
the city's sales tax collections are spilt evenly among the three
counties in which Selma is located: Bexar, Comal and Guadalupe.
Local Government Impact
The newly created advanced transportation district would receive revenues
of approximately $29.8 million per year to be used for advanced
transportation purposes within the district. If the City of San Antonio
would vote to create the district, but some of the other 15
municipalities or the unincorporated area of VIA would choose not to join
the district, district revenue could be as much as 5 percent lower than
presented in this estimate.
All 16 of the cities belonging to the VIA Metropolitan Transit authority
and Bexar County would be expected to receive local development revenues.
It is estimated that these entities would share approximately $29.8
million per year. These revenues would be allocated according to district
sales tax collection levels in each unit of local government belonging
to the district. VIA estimates that the City of San Antonio would receive
almost 95 percent of these revenues. Any entity choosing not to join the
district would not receive local development revenues. If the board of
the transit authority would not choose to order an election to impose the
local development sales and use tax, none of the municipalities would
receive the additional revenues provided in this estimate.
Since the City of Balcones Heights Crime Control District imposes a sales
and use tax of 0.5 percent, and since the total local sales tax rate in
Balcones Heights is already at 2 percent, the crime control district
would lose all of its sales tax revenues if the City of Balcones Heights
would vote to join the advanced transportation district. This would
result in an estimated loss to the district of approximately $655,000 per
year. Local development revenues to the city could offset some of the
loss to the crime control district. If voters in Balcones Heights would
choose not to join the district, there would be no impact to the Balcones
Heights Crime Control District or to the City of Balcones Heights.
Since Guadalupe and Comal Counties each impose a 0.5 percent sales tax in
the City of Selma, and since the total local sales and use tax rate
within the city is already at the maximum 2 percent, if voters in Selma
would vote to join the advanced transportation district, it is expected
that the county sales and use tax would be repealed within the City of
Selma. Consequently, each county could lose revenues estimated at
approximately $40,000 per year. If the City of Selma would not join the
district, there would be no fiscal impact to Guadalupe and Comal
Counties.
If the VIA Metropolitan Transit authority would not choose to order an
election to create an advanced transportation district, no fiscal
implications to the authority or to any municipality that belongs to the
authority would be expected.
Source Agencies:
LBB Staff: JK, TL