LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              April 10, 2001
  
  
          TO:  Honorable Frank Madla, Chair, Senate Committee on
               Intergovernmental Relations
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB1543  by Luna, Vilma (Relating to the sales and use tax
               imposed by municipal crime control and prevention
               districts.), As Engrossed
  
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*  No significant fiscal implication to the State is anticipated.        *
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The bill would amend Chapter 363 of the Local Government Code to specify
that a municipality that created a crime control and prevention district
would have to adopt a sales and use tax under Section 321.106 of the Tax
Code, as created by this bill.

The bill would also amend Chapter 321 of the Tax Code to create the
"municipal crime control and prevention district tax."  If approved at an
election, revenue from such a tax could only be used for the purpose of
financing the operation of the district.

The Comptroller would have to remit to the municipality creating a
district amounts collected from the sales and use tax as part of the
regular allocation of municipal tax revenue collected by the Comptroller,
if the district was composed of the entire municipality.  In cases where
the district was composed of less than the entire municipality, the
allocation would be made to the district.

The bill would take effect immediately upon enactment, assuming that it
received the requisite two-thirds majority votes in both houses of the
Legislature.  Otherwise, it would take effect September 1, 2001.

Note:  Currently, residential gas and electricity are exempt from sales
and use taxes adopted for the operation of crime control and prevention
districts under Section 323.105 of the Tax Code.  A crime control
district implemented under the provisions of this bill (Chapter 321.106)
would include residential gas and electricity in the tax base.
  
Local Government Impact
  
It is not known which municipalities would create a crime control
district and adopt a sales tax under the provisions of this bill, at
what rate the tax would be levied, or when a municipality would choose
to do so.
  
  
Source Agencies:   304   Comptroller of Public Accounts
LBB Staff:         JK, DB, SD, WP, SM