LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 27, 2001
TO: Honorable Rene Oliveira, Chair, House Committee on Ways &
Means
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB1965 by Danburg (Relating to the imposition and use of
revenue from a sales and use tax on billboard advertising
services.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB1965, As Introduced: impact of $0 through the biennium ending *
* August 31, 2003. *
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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $0 *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Revenue Revenue Revenue Revenue *
* Gain/(Loss) Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to *
* from New Cities Transit Counties/SPDs *
* General Revenue Authorities *
* Dedicated *
* Account - *
* Highway *
* Billboard *
* Removal *
* 2002 $9,284,000 $1,524,000 $588,000 $180,000 *
* 2003 10,755,000 1,942,000 749,000 230,000 *
* 2004 11,507,000 2,078,000 802,000 246,000 *
* 2005 12,315,000 2,224,000 858,000 263,000 *
* 2006 13,228,000 2,388,000 922,000 283,000 *
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Fiscal Analysis
The bill would amend Chapter 151 of the Tax Code to create a definition
of "billboard advertising service" and add that service to the list of
taxable services under the limited sales and use tax.
The proceeds from the collection of sales and use taxes on billboard
advertising services would be deposited to the credit of the
newly-created GR Account - Highway Billboard Removal. This account could
be appropriated only to the Texas Department of Transportation (TxDOT).
TxDOT would be authorized to use the money in the account only to remove
billboards during the improvement of the state highway system, as
defined by the Transportation Code.
The bill would take effect September 1, 2001.
Methodology
This estimate was based on U. S. Census Bureau data on Texas receipts
from outdoor advertising services. Receipts subject to the limited sales
and use tax were multiplied by the state sales tax rate, adjusted for
effective date, and extrapolated through 2006. The fiscal impact on
units of local government were estimated proportionally.
Note: This legislation would do one or more of the following: create or
recreate a dedicated account in the General Revenue Fund, create or
recreate a special or trust fund either with or outside of the Treasury,
or create a dedicated revenue source. Legislative policy, implemented
as Government Code 403.094, consolidated special funds (except those
affected by constitutional, federal, or other restrictions) into the
General Revenue Fund as of August 31, 1993 and eliminated all applicable
statutory revenue dedications as of August 31, 1995. Each subsequent
Legislature has reviewed bills that affect funds consolidation. The
fund, account, or revenue dedication included in this bill would be
subject to funds consolidation review by the current Legislature.
Local Government Impact
Local units of government would have a corresponding fiscal impact from
sales tax revenues, as indicated in the table above.
Source Agencies: 304 Comptroller of Public Accounts
LBB Staff: JK, SD, WP, SM