LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 80TH LEGISLATIVE REGULAR SESSION

March 13, 2007

TO:	Honorable Jim Keffer, Chair, House Committee on Ways & Means
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	HB1751 by Cohen (Relating to imposing a fee on admissions to certain sexually oriented businesses.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for HB1751, As Introduced: a positive impact of $87,277,000 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	$34,260,000
2009	$53,017,000
2010	$59,930,000
2011	$60,944,000
2012	$61,987,000

All Funds, Five-Year Impact:

Fiscal Year	Probable Revenue Gain/(Loss) from GENERAL REVENUE FUND 1	Probable Revenue Gain/(Loss) from Cities and Counties
2008	$34,260,000	($660,000)
2009	$53,017,000	($825,000)
2010	$59,930,000	($933,000)
2011	$60,944,000	($948,000)
2012	$61,987,000	($965,000)

Fiscal Analysis

The bill would amend Chapter 47 of the Business and Commerce Code to establish an admission fee of $5 on customers of sexually oriented businesses that provide live nude entertainment or performances. The bill would require the Comptroller of Public Accounts to develop rules for the administration, payment, collection, and enforcement of these fees, which would be deposited to the General Revenue Fund.

The bill would take effect September 1, 2007.

Methodology

The Comptroller of Public Accounts estimated the fiscal impact based on establishment data, relating to those entities that would qualify under the provision of the bill, provided by the Texas Alcoholic Beverage Commission (TABC). The estimate includes an adjustment to the establishment count to account for such entities not licensed by TABC. The estimate assumes that the $5 admissions charge required under the provisions of the bill, would have a negative effect on the sale of alcoholic beverages in those establishments licensed by TABC, which would result in a loss of revenue from the mixed beverage tax to the state and local units of government. The estimate for the fiscal 2008 includes an adjustment for the effective date, the quarterly reporting requirement, and employer collection and compliance considerations.

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, CT, SD, EB