LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
April 15, 1999
TO: Honorable J.E. "Buster" Brown, Chair, Senate Committee on
Natural Resources
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB 1481 by Haywood (Relating to the appraisal of
agricultural land for ad valorem taxation.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1481, As Introduced: positive impact of $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. *
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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 (11,502,000) *
* 2003 (12,078,000) *
* 2004 (12,682,000) *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Revenue Revenue Revenue *
* to General Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to *
* Revenue Fund School Districts Counties Cities *
* 0001 *
* 2000 $0 $0 $0 $0 *
* 2001 0 (11,502,000) (3,035,000) (11,502,000) *
* 2002 (11,502,000) (576,000) (3,187,000) (12,078,000) *
* 2003 (12,078,000) (604,000) (3,346,000) (12,682,000) *
* 2004 (12,682,000) (634,000) (3,514,000) (13,316,000) *
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Fiscal Analysis
The bill would repeal the provisions in Subchapters C and D of Chapter 23
of the Tax Code concerning interest on rollback taxes for the change of
use of agricultural land. The annual statutory interest rate on
rollback taxes is 7 percent.
Methodology
The Comptroller's Property Tax Division staff used tax year 1993 reported
information from cities, counties, and school districts to estimate the
loss to local governments as a result of the bill. 1993 is the last year
taxing units reported rollback taxes collected. The 1993 tax year
rollback tax numbers were trended upward, based on historical property
tax levy increases, to reflect estimated losses to local governments for
fiscal years 2000-04. The total rollback loss per year for school
districts, cities, and counties was multiplied by 35 percent to reflect a
7 percent loss of interest for each of the five years of rollback tax.
Because the state school funding formula is based in part on effective
school districts tax rates, it was assumed that the loss to school
districts, due to the provisions of the bill, would be reimbursed
through the school funding formula after a one-year lag, creating a cost
to the state.
Local Government Impact
The impact on local taxing units is reflected in the above table.
Source Agencies: 304 Comptroller of Public Accounts
LBB Staff: JK, DE, BR