Honorable Morgan Meyer, Chair, House Committee on Ways & Means
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB1294 by Guillen (Relating to the exemption of rural transit districts from motor fuel taxes.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB1294, As Introduced : a negative impact of ($77,000) through the biennium ending August 31, 2023.
General Revenue-Related Funds, Five- Year Impact:
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2022
($36,000)
2023
($41,000)
2024
($42,000)
2025
($43,000)
2026
($43,000)
All Funds, Five-Year Impact:
Fiscal Year
Probable Revenue (Loss) from General Revenue Fund 1
Probable Revenue (Loss) from Available School Fund 2
Probable Revenue (Loss) from State Highway Fund 6
2022
($1,000)
($35,000)
($106,000)
2023
($2,000)
($39,000)
($118,000)
2024
($2,000)
($40,000)
($120,000)
2025
($2,000)
($41,000)
($122,000)
2026
($2,000)
($41,000)
($124,000)
Fiscal Analysis
The bill would amend several sections of Chapter 162, Tax Code, to provide for exemption of rural transit districts from payment of motor fuel taxes.
The bill would amend Section 162.104 (a) to exempt rural transit districts from the payment of gasoline taxes for fuel used exclusively to provide public transportation. The bill would amend Section 162.204 (a) and Section 162.356 (a) to exempt rural transit districts from the payment of taxes on diesel fuel and compressed or liquefied natural gas.
The bill would add Section 162.1276, to provide for rural transit districts to file a refund claim with the comptroller's office for the payment of taxes on gasoline used to provide public transportation. The refund claim must contain information regarding vehicle mileage, hours of service provided, and fuel consumed. This bill would add Sections 162.2276 and 162.3685 to provide comparable provisions for refunds to rural transit districts of taxes paid on diesel fuel and compressed or liquefied natural gas.
The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2021.
Methodology
Under current statute, several public entities receive an exemption from the payment of motor fuel taxes. This bill would add rural transit districts to the list of entities that are exempted from the payment of such taxes and are entitled to file refund claims on the taxes paid for motor fuel that is exclusively used in their operations.
Based on information from the Texas A&M University Transportation Institute's Transit Mobility Program, 36 transit districts would be exempted from motor fuels taxes by the bill.
National data on fuel consumed by public transit authorities per unlinked passenger trip was multiplied by the number of unlinked passenger trips for each of the 36 rural transit districts to estimate the volume of fuel that would be exempted from tax. The result was multiplied by the $0.20 tax per gallon of fuel and extrapolated to 2020 and subsequent years with the historical and forecast rates of growth of the motor fuels tax revenues. The exemption provided to rural transit district would have a negative fiscal impact on the state.
Local Government Impact
The bill would decrease the amount of motor fuel taxes paid by rural transit districts.