LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              March 29, 2001
  
  
          TO:  Honorable Rene Oliveira, Chair, House Committee on Ways &
               Means
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB2842  by Coleman (Relating to reinvestment zones and
               tax increment financing under the Tax Increment Financing
               Act.), As Introduced
  
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*  No significant fiscal implication to the State is anticipated.        *
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The bill would amend Sections 311.010 and 311.014 of the Tax Code,
relating to Tax Increment Financing Act.

The bill would allow the board of directors of a local government
corporation administering a reinvestment zone to contract with the city
creating the zone to pay for the incremental costs of providing city
services incurred as a result of development within the zone.

The bill would allow a city, after payment of all tax increment
obligations, but before the payment of all project costs, to reduce its
contributions to the tax increment fund to an amount adequate to pay
annual project costs of the zone.

Passage of this bill would allow certain discretionary actions by local
units of government in executing the terms of tax increment financing
agreements.  The bill would not mandate the use or allocation of local
revenues.  The provisions of the bill could result in an increase in
local revenue earlier than current law would allow.  However, the amount
of potential increase is not expected to represent a major increase in
local revenue.
  
Local Government Impact
  
No significant fiscal implication to units of local government is
anticipated.
  
  
Source Agencies:   304   Comptroller of Public Accounts
LBB Staff:         JK, SD, BR