| TO: | Honorable Harvey Hilderbran, Chair, House Committee On Ways & Means |
| FROM: | Ursula Parks, Director, Legislative Budget Board |
| IN RE: | HB105 by Larson (Relating to the allocation of the proceeds from taxes imposed on the sale, storage, or use of sporting goods.), As Introduced |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2014 | ($23,065,624) |
| 2015 | ($60,246,326) |
| 2016 | ($91,668,326) |
| 2017 | ($97,684,326) |
| 2018 | ($103,888,326) |
| Fiscal Year | Probable Revenue (Loss) from General Revenue Fund 1 |
Probable Savings/(Cost) from General Revenue Fund 1 |
Probable Revenue Gain from State Parks Acct 64 |
Probable Revenue Gain from Local Parks Account 467 |
|---|---|---|---|---|
| 2014 | ($24,146,326) | $1,080,702 | $7,897,598 | $9,367,813 |
| 2015 | ($60,246,326) | $0 | $34,611,598 | $14,782,813 |
| 2016 | ($91,668,326) | $0 | $57,863,878 | $19,496,113 |
| 2017 | ($97,684,326) | $0 | $62,315,718 | $20,398,513 |
| 2018 | ($103,888,326) | $0 | $66,906,678 | $21,329,113 |
| Fiscal Year | Probable Revenue Gain from Large Cnty & Muni Rec & Parks 5150 |
Probable Revenue Gain from Parks/Wildlife Cap Acct 5004 |
|---|---|---|
| 2014 | $6,227,915 | $653,000 |
| 2015 | $9,837,915 | $1,014,000 |
| 2016 | $12,980,115 | $1,328,220 |
| 2017 | $13,581,715 | $1,388,380 |
| 2018 | $14,202,115 | $1,450,420 |
The bill would amend Chapter 151 of the Tax Code, regarding the sales and use tax. The bill would repeal Section 151.801(c-1), which provides for limiting the allocation of sales tax revenue from the sales of sporting goods to appropriated amounts.
The bill would amend Section 151.801(c) to provide for the allocation of the proceeds from collections of sales tax on sporting goods as follows: in fiscal 2014, 50 percent to the Texas Parks and Wildlife Department (TPWD), 3 percent to the Texas Historical Commission (THC), and the remainder would remain as unallocated General Revenue; in fiscal 2015, 75 percent to TPWD, 5 percent to the THC, and the remainder as unallocated General Revenue; and in fiscal 2016 and thereafter, 94 percent to TPWD and 6 percent to the THC. Allocations to TPWD would be deposited as specified in the Parks and Wildlife Code.
In this analysis the Comptroller of Public Accounts’ estimates of sales tax revenue from sales of sporting goods for the five-year period are compared to the annualized amount of sales tax revenue from sporting goods appropriated to the TPWD and the Texas Historical Commission (THC) in the 2012-13 biennium. The incremental difference between estimated and appropriated amounts is shown as a revenue loss to the General Revenue Fund and a revenue gain to the TPWD General Revenue-Dedicated accounts that by statute are recipients of the proceeds.
Although the legislation would repeal the existing limitation on the allocation of sales tax revenue from sporting goods to appropriated amounts, these amounts would still be subject to the appropriations process. Unlike TPWD, the THC allocation of proceeds from the collection of sales tax on sporting goods is not deposited to a General Revenue-Dedicated Account, but is appropriated directly from the General Revenue Fund. As a result, the repeal of the limitation on the allocation for the Texas Historical Commission is not anticipated to result in an additional cost to the General Revenue Fund. Furthermore, the legislation if enacted, could result in large unappropriated balances accruing to the four TPWD General Revenue-Dedicated accounts that receive the allocation.
The bill would take effect September 1, 2013.
For purposes of this analysis, it is assumed that no additional appropriation above existing levels would occur should this legislation be enacted. As a result, the repeal of the limitation on the allocation for the Texas Historical Commission is not anticipated to result in an additional cost to the General Revenue Fund. Furthermore, the legislation if enacted, could result in large unappropriated balances accruing to the four TPWD General Revenue-Dedicated accounts that receive the allocation.
In their analysis, the Comptroller of Public Accounts extrapolated the estimate for state sales tax revenues from sales of sporting goods in the 2014-15 Biennial Revenue Estimate through fiscal year 2018 and the allocation percentages for each year as provided by the legislation and the Parks and Wildlife Code were applied to the estimate for each year.
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
TPWD $ 65,300,000 $ 101,400,000 $ 132,822,000 $ 138,838,000 $145,042,000 THC $ 3,918,000 $ 6,760,000 $ 8,478,000 $ 8,862,000 $ 9,258,000
General Revenue $ 61,382,000 $ 27,040,000 - - -
Total $ 130,600,000 $ 135,200,000 $ 141,300,000 $ 147,700,000 $154,300,000
The revenue gain to the four TPWD General Revenue-Dedicated accounts was derived by calculating the difference between the maximum allocation of state sales tax revenues from sales of sporting goods and the annualized amounts appropriated to TPWD in the 2012-13 biennium. The annualized amounts are indicated by General Revenue-Dedicated Account below:
1) Transfer from General Revenue to the State Parks Account No. 64: $40,424,402
2) Transfer from General Revenue to the Texas Recreation and Parks Account No. 467: $427,187
3) Transfer from General Revenue to the Large County and Municipality Recreation No. 5150: $302,085
4) Transfer from General Revenue to the Texas Parks and Wildlife Conservation and Capital Account No. 5004: $0
Annualized appropriations from state sales tax revenues in the 2012-13 biennium for the Texas Historical Commission was $4,998,702. Note that in fiscal year 2014, the bill would not provide sufficient allocations to cover these costs. This shortfall in fiscal year 2014 would be $1,080,702 and is shown as a cost savings in the table above.
For any one fiscal year, the sum of the current annualized appropriation plus the incremental increase in available balances totals the statutory maximum of available balances for each account.
For example, in fiscal year 2014 the maximum available balances for each account would be as follows:
1) State Parks Account: $48,322,000 ($40,424,402 + $7,897,598)
2) Texas Recreation and Parks Account: $9,795,000 ($427,187 + $9,367,819)
3) Large County and Municipality Recreation and Parks Account: $6,530,000 ($302,085+$6,227,915)
4) Texas Parks and Wildlife Conservation and Capital Account No. 5004: $653,000
| Source Agencies: | 304 Comptroller of Public Accounts, 802 Parks and Wildlife Department, 808 Historical Commission
|
| LBB Staff: | UP, KK, ZS, TB, SD
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