| TO: | Honorable Glenn Lewis, Chair, House Committee on County Affairs |
| FROM: | John Keel, Director, Legislative Budget Board |
| IN RE: | HB1816 by McReynolds (Relating to the counties eligible to create a county assistance district that may impose a sales and use tax.), As Introduced |
The bill would change the requirements for eligibility for a county to create a county assistance district that may impose a sales and use tax. The bill would take effect immediately if it receives a two-thirds vote in each house; otherwise, it would take effect September 1, 2003.
Under existing statute, only a county with a population of less than 45,000 and in which a Transportation Code, Chapter 451 or Chapter 452 transit authority is included in any portion of the territory is eligible to create a county assistance district. The provisions of the bill would add that a county with a population of less than 45,000 that does not impose a sales and use tax under Chapter 323, Tax Code, would also be eligible to establish a county assistance district. Regardless of the eligibility requirement that applies to a county, the combined local tax rate in such a district could not exceed 2 percent.
Currently, there are four transit authorities established under Chapter 451 of the Transportation Code and two established under Chapter 452. None of those six authorities is in a county with a population under 45,000. There are 101 counties that would fit the eligibility criteria for creating a county assistance district under the proposed amended statute.
A county choosing to create a county assistance district would incur the cost of holding an election to decide whether to create a district and to vote on the tax rate to be imposed.
The Comptroller of Public Accounts estimates incurring administrative costs of $134,470 in fiscal year 2004 to notify taxpayers and $460 per year through fiscal year 2008 for technology costs to respond to additional telephone calls regarding the impact of the creation of new county assistance districts.
| Source Agencies: | 304 Comptroller of Public Accounts
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| LBB Staff: | JK, DLBa
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