LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION

April 9, 2009

TO:	Honorable Steve Ogden, Chair, Senate Committee on Finance
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	SB227 by West (Relating to a fee on certain lottery prizes to fund the TEXAS grant program.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for SB227, As Introduced: a positive impact of $32,815,000 through the biennium ending August 31, 2011.

The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2010	$16,604,000
2011	$16,211,000
2012	$16,190,000
2013	$16,458,000
2014	$16,573,000

All Funds, Five-Year Impact:

Fiscal Year	Probable Revenue Gain/(Loss) from General Revenue Fund 1	Probable Revenue Gain/(Loss) from General Revenue Fund (TEXAS Grant Program)	Probable Revenue Gain/(Loss) from Foundation School Fund 193
2010	($241,000)	$21,592,000	($4,747,000)
2011	($236,000)	$21,109,000	($4,662,000)
2012	($236,000)	$21,078,000	($4,652,000)
2013	($239,000)	$21,396,000	($4,699,000)
2014	($241,000)	$21,535,000	($4,721,000)

Fiscal Analysis

The bill would amend the Government Code to require the Texas Lottery Commission to collect a five percent prize fee from a person who is paid a prize of $600 or more. The fee would be deposited to the General Revenue Fund and could be appropriated only to fund the TEXAS grant program.

The bill would take effect on September 1, 2009.

Methodology

The fiscal impact reflected in the table above is based on the information and analysis provided by the Texas Lottery Commission (TLC) and the Comptroller's office. Based on the analysis of TLC and the Comptroller's office, it is assumed the five percent prize fee imposed on prizes of $600 or more would result in a gain to the TEXAS Grant Program beginning in fiscal year 2010. Also based on the analysis of the Comptroller's office, it is assumed the prize fee would exert downward pressure on lottery ticket purchases resulting in decreases in lottery revenue transferred to the Foundation School Fund and amounts transferred to the General Revenue Fund from unclaimed lottery prizes.

Local Government Impact

No fiscal implication to units of local government is anticipated.

Source Agencies:

304 Comptroller of Public Accounts, 362 Texas Lottery Commission

LBB Staff:

JOB, MN, MW, TG