Honorable Mike Jackson, Chair, Senate Committee on Economic Development
FROM:
John S O'Brien, Director, Legislative Budget Board
IN RE:
SB1180 by Nelson (Relating to hotel occupancy taxes and livestock facility use taxes for certain venue projects.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB1180, As Introduced: an impact of $0 through the biennium ending August 31, 2013.
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2011
$0
2012
$0
2013
$0
2014
$0
2015
$0
2016
$0
Fiscal Year
Probable Revenue Gain/(Loss) from City of Fort Worth
2011
$167,083
2012
$2,055,000
2013
$2,107,000
2014
$2,159,000
2015
$2,213,000
2016
$2,269,000
Fiscal Analysis
The bill would amend Chapter 334 of the Local Government Code, regarding sports and community venues.
The bill would give authority to a municipality with a population of more than 700,000 located in a county with a population of more than one million that is adjacent to a county with a population of more than two million impose a hotel occupancy tax at any rate not to exceed 3 percent of the price paid for a room in a hotel. A municipality meeting the preceding criteria that adopts a tax at a rate of less than 3 percent may by ordinance increase the rate to the maximum applicable rate if the increase is approved by a majority of voters.
The bill would expand the definition of a designated facility, as it applies to the livestock facility use tax, to include a facility containing livestock stalls or pens located adjacent to the approved venue project.
The bill would take effect immediately if it receives a vote of two-thirds of all members elected to each house, otherwise the bill would take effect on September 1, 2011.
Methodology
According to the Comptroller of Public Accounts, the bill would apply to the city of Fort Worth. The city of Fort Worth was contacted to determine the fiscal impact of the bill on the city. The city indicated there would be no cost to collecting the hotel occupancy tax since they already collect it. Assuming the city receives approval through an election to increase the tax from 2 percent to 3 percent, the amount of additional revenue resulting from the one percent increase for fiscal 2011-2016 would be estimated at $10,970,083. The city's fiscal year begins October 1.
Local Government Impact
Assuming the city receives approval through an election to increase the tax from 2 percent to 3 percent, the amount of additional revenue resulting from the one percent increase for fiscal 2011-2016 would be estimated at $10,970,083. The impact to Fort Worth is shown in the table above.