LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 80TH LEGISLATIVE REGULAR SESSION

April 26, 2007

TO:	Honorable Royce West, Chair, Senate Committee on Intergovernmental Relations
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	HB1216 by Pitts (Relating to the authority of certain counties to impose a county hotel occupancy tax and to the use of the tax.), As Engrossed

Estimated Two-year Net Impact to General Revenue Related Funds for HB1216, As Engrossed: an impact of $0 through the biennium ending August 31, 2009.

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2008	$0
2009	$0
2010	$0
2011	$0
2012	$0

All Funds, Five-Year Impact:

Fiscal Year	Probable Revenue Gain/(Loss) from Bosque County	Probable Revenue Gain/(Loss) from Hill County	Probable Revenue Gain/(Loss) from Johnson County
2008	$125,000	$605,000	$440,000
2009	$130,000	$628,000	$457,000
2010	$135,000	$652,000	$474,000
2011	$139,000	$675,000	$491,000
2012	$144,000	$697,000	$507,000

Fiscal Analysis

The bill would amend Section 352.002 of the Tax Code, relating to the authority of certain counties to impose a county hotel occupancy tax and to the rate of that tax. Under the provisions of the bill, any county that borders Whitney Lake would be allowed to impose a county hotel occupancy tax; however, the tax imposed by the amended section would not apply to a hotel located in a municipality that imposes a tax under Chapter 351.

The bill would take effect immediately upon enactment if it receives two-thirds vote in each house; otherwise, it would take effect September 1, 2007.

Methodology

According to the Comptroller of Public Accounts, three counties would meet the criteria established under the provisions of the bill: Bosque County, Hill County, and Johnson County.

Currently, unless otherwise specified, counties authorized to impose a county hotel occupancy tax may not impose the tax at a rate greater than 7 percent. For the purpose of this estimate, the Comptroller gathered data on taxable hotel receipts from Bosque, Hill, and Johnson Counties from its tax files, and multiplied the receipts by the 7 percent rate to estimate the potential maximum gain to the counties.

It is not known whether any of these counties would approve a county hotel occupancy tax or at what rate. For the purpose of this estimate it is assumed that each county would adopt a county hotel occupancy tax at the maximum rate authorized by the bill.

Local Government Impact

The fiscal impact to local government is illustrated in the above tables.

Source Agencies:

304 Comptroller of Public Accounts

LBB Staff:

JOB, DB, CT, SD, EB