LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 76th Regular Session
  
                              March 15, 1999
  
  
          TO:  Honorable Frank Madla, Chair, Senate Committee on
               Intergovernmental Relations
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB 790  by Moncrief (Relating to certain hotel
               facilities.), As Introduced
  
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*  Implementing the provisions of the bill could result in negative      *
*  fiscal impacts under the various scenarios possible.                  *
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FISCAL ANALYSIS

The bill would amend Chapter 2303 of the Government Code to expand the
definition of a "qualified hotel project" to include a hotel owned or
operated by or located on land owned by an eligible central municipality,
as defined by Section 351.001 of the Tax Code, or by a nonprofit
corporation acting on behalf of an eligible central municipality, and
located within 1,000 feet of a convention center facility owned by the
municipality, including shops, parking facilities, and any other
facilities ancillary to the hotel.

Eligible central municipalities would be allowed to pledge the revenue
from hotel occupancy taxes, ad valorem taxes, local sales and use taxes
and mixed beverage taxes originating from a qualified hotel project for
the payment of bonds issued for the construction of the hotel.

Based on the definition of an eligible central municipality under Chapter
351 of the Tax Code, the cities of San Antonio and Fort Worth are the
only municipalities that would be classified as eligible central
municipalities

METHODOLOGY

The bill could result in reduced tax revenue to state and on local
governments. The loss would depend on the number and size of "qualified
hotel projects" constructed under the  provisions of the bill that would
normally be subject to property taxes but would be exempt as "public-use
property," as allowed under Section 4B.  Passage of the bill could cause
a reduction in a school district's taxable values reported to the
Commissioner of Education by the Comptroller.  The Texas Education
Agency has estimated that as a general rule, a difference of $1 billion
in property valuation would change state aid requirements by about $14
million each year.
  
Source Agencies:   
LBB Staff:         JK, TL, SM