| TO: | Honorable Mike Hamilton, Chair, House Committee on Licensing & Administrative Procedures |
| FROM: | John S O'Brien, Director, Legislative Budget Board |
| IN RE: | HB175 by Jackson, Jim (Relating to the on-premises consumption of certain alcoholic beverages; providing a penalty.), Committee Report 1st House, Substituted |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2012 | $163,555 |
| 2013 | ($798) |
| 2014 | $172,102 |
| 2015 | ($798) |
| 2016 | $172,102 |
| Fiscal Year | Probable Savings/(Cost) from General Revenue Fund 1 |
Probable Revenue Gain/(Loss) from General Revenue Fund 1 |
|---|---|---|
| 2012 | ($9,345) | $172,900 |
| 2013 | ($798) | $0 |
| 2014 | ($798) | $172,900 |
| 2015 | ($798) | $0 |
| 2016 | ($798) | $172,900 |
The bill would amend the Alcoholic Beverage Code relating to the on-premises consumption of certain alcoholic beverages. The bill would create a new “On-Premises Consumption Only” license and establish an annual state fee of $1,000 for the new license. The license would be required for the owner of a commercial establishment that provides entertainment/social activities or charges a fee (payment, dues or mandatory purchase) for admittance to the establishment and allows a person to bring alcoholic beverages on the establishment’s premises for consumption. The bill exempts establishments that operate primarily as a food service establishment; veterans/fraternal organizations; an establishment operated by a religious organization, governmental entity or charitable organization; a premises already covered by a Texas Alcoholic Beverage Commission (TABC) license/permit; or other types of establishments as determined by TABC where the consumption of alcohol does not pose a threat to the public health or safety.
The TABC would adopt all rules necessary to implement the provisions of the bill by November 1, 2011. Businesses required by the bill to have an “On-Premises Consumption Only” permit would be required to be in compliance with the bill by January 1, 2012.
The bill would authorize the TABC to create a new permit type and collect the fees associated with the permit. This bill would create a fiscal impact of $9,345 in FY 2012 for start-up and implementation costs and annual reoccurring software maintenance charges of $798.
The bill would also generate revenue for permit fees collected by the TABC on a biennial basis according to the issue date of the new permit type. The TABC has moved to two year permits as stated in the Alcoholic Beverage Code Section 11.09. Therefore, the biennial fee for the permit would be $2,000 resulting in an estimated revenue stream of $140,000 every other year; based on the 70 Texas businesses identified by the TABC that this bill would affect. The biennial surcharge would be estimated at $470 resulting in estimated revenue of $32,900 every other year.
The annual operating costs in subsequent years associated with the bill would be $798 for software maintenance through the Data Center Consolidation Project. Permit fees would be collected on a biennial basis according to issue date of the new permit type, resulting in a revenue stream of $140,000 every other year, based on an estimate of business who would probably seek a permit. A rule would be adopted to establish a surcharge. The biennial surcharge would be estimated at $470 resulting in estimated revenue of $32,900 every other year. If any of the businesses obtained food service permits and prepared and served food, they would be exempt and revenue could be zero from those particular businesses.
Programming costs included in this analysis are based on current rates paid to the agency’s vendors. Additionally, estimates have been included for increases in the Data Center Consolidation cost for software maintenance. The programming costs total $7,980 and would result in an increase in software maintenance of $798 per year.
| Source Agencies: | 304 Comptroller of Public Accounts, 458 Alcoholic Beverage Commission
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| LBB Staff: | JOB, AG, GG, DAR
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