LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 79TH LEGISLATIVE REGULAR SESSION
 
April 11, 2005

TO:
Honorable Allan Ritter, Chair, House Committee on Economic Development
 
FROM:
John S. O'Brien, Deputy Director, Legislative Budget Board
 
IN RE:
HB1258 by Orr (Relating to the definition of a primary job with respect to a project that may be undertaken by a development corporation.), As Introduced

No significant fiscal implication to the State is anticipated.

The bill would amend the Development Corporation Act of 1979 (the Act) to add certain health care related jobs to the definition of "primary job."   Under current law, an industrial development corporation (corporation) can lease authorized projects to a non-exempt entity and that project is exempt from ad valorem, sales and use taxes or any other taxes levied or imposed by this state or any political subdivision of the state.  Since the bill would expand the types of authorized projects to include certain health care related projects, it could impact the amount of taxable property values and the related ad valorem taxes as well as other taxes.

Section 403.302 of the Government Code requires the Comptroller to conduct a property value study to determine the total taxable value for each school district.  Total taxable value is an element in the state's school funding formula.  Passage of this bill could cause a change in the school district taxable values reported to the Commissioner of Education by the Comptroller and a change in state costs to the Foundation School Fund.


Local Government Impact

Since the bill would expand the types of authorized projects to include certain health care related projects, it could impact the amount of taxable property values and the related ad valorem taxes as well as other taxes collected by units of local government.

While the number of development corporations created by counties and cities statewide is unknown, city corporations created under Sections 4A and 4B of the Act are required to file an annual report with the Comptroller. For fiscal 2004, there were 517 cities with a 4A and/or 4B development corporation(s).



Source Agencies:
304 Comptroller of Public Accounts, 301 Office of the Governor
LBB Staff:
JOB, JRO, WP, SM, DLBe, KJG