LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 17, 2001
TO: Honorable David Sibley, Chair, Senate Committee on
Business & Commerce
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB715 by Staples (Relating to a franchise tax credit for
expenditures made toward the cost of transportation
provided to certain welfare recipients.), As Introduced
**************************************************************************
* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB715, As Introduced: negative impact of $(1,956,000) through the *
* biennium ending August 31, 2003. *
**************************************************************************
General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $0 *
* 2003 (1,956,000) *
* 2004 (2,359,000) *
* 2005 (2,493,000) *
* 2006 (2,635,000) *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Revenue Gain/(Loss) from *
* General Revenue Fund *
* 0001 *
* 2002 $0 *
* 2003 (1,956,000) *
* 2004 (2,359,000) *
* 2005 (2,493,000) *
* 2006 (2,635,000) *
*****************************************************
Fiscal Analysis
The bill amends Chapter 171 of the Tax Code to authorize a franchise tax
credit for the costs of transportation provided to certain welfare
recipients. The credit would be equal to the full amount of the
transportation costs to the extent that those costs did not exceed 50
percent of the firm's net tax liability after the application of any
other applicable credits.
The bill takes effect January 1, 2002 and applies to franchise tax
reports due on or after that date and for transportation costs incurred
on or after that date.
Methodology
This estimate was developed from analysis provided by the Comptroller's
Office.
The Comptroller staff obtained the number of potential welfare recipients
from client counts provided by the appropriate state agency. The staff
assumed that one in four (or 25 percent) of eligible recipients would
receive reimbursement for their transportation costs from their employer.
The number of credit participants was multiplied by the cost of a
typical round-trip bus fare and then multiplied by the number of working
days in the year. That estimate of creditable transportation expenses
provided the basis of the estimated fiscal impact.
The bill has no impact in fiscal year 2002 because the corporate
accounting year on which the fiscal year 2002 tax report is based would
be concluded prior to the bill's effective date. The bill would have a
reduced revenue impact in fiscal year 2003, because the accounting year
for non-calendar-year corporations would be partially completed before
the effective date. The bill has its full fiscal effect in fiscal year
2004.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 304 Comptroller of Public Accounts, 320 Texas
Workforce Commission
LBB Staff: JK, JO, CT