COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 2187-01
Bill No.: SB 617
Subject: Hotels and Motels, Economic Development, Enterprise Zones.
Type: Original
Date: March 12, 2001
FISCAL SUMMARY
| FUND AFFECTED | FY 2002 | FY 2003 | FY 2004 |
| General Revenue | (Under $100,000) | (Under $100,000) | (Under $100,000) |
| Total Estimated
Net Effect on All State Funds |
(Under $100,000) | (Under $100,000) | (Under $100,000) |
| FUND AFFECTED | FY 2002 | FY 2003 | FY 2004 |
| None | |||
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2002 | FY 2003 | FY 2004 |
| Local Government | $0 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 3 pages.
ASSUMPTION
In response to similar legislation from this year, officials from the Department of Economic Development (DED) assumed this bill will assist Salem, Missouri and could create some recurring costs for Enterprise Zone Credits that could be offset by a positive but indeterminable economic benefit to the state. The DED assumes there will be no fiscal impact to their agency.
Officials from the Department of Revenue (DOR) state they do not anticipate a significant increase in the number of new credits filed. Therefore, the DOR will not request additional FTE at this time. However, if DOR is incorrect in this assumption, they will need one Temporary Tax Season Employee for every 75,000 additional credits, one Tax Processing Tech I for every 30,000 additional errors generated and one Tax Processing Tech I for every 3,000 additional pieces of correspondence received regarding this credit. Any FTE needed will be requested during the normal budget process.
Officials from the City of Salem state with passage of this legislation, a new 65 room hotel facility will probably be built in their community. The City of Salem estimates the annual revenues from this facility for the city, including sales tax and increased property taxes would be roughly $11,521. The City of Salem also estimates that gross water and electric revenues for this new facility would be roughly $60,000 to the City.
Oversight is unable to determine the amount of tax credits that will be utilized with the passage of this legislation, but based upon the response from DED, assumes the amount to be under $100,000 in any given fiscal year.
| FISCAL IMPACT - State Government | FY 2002
(10 Mo.) |
FY 2003 | FY 2004 |
| GENERAL REVENUE FUND | |||
| Costs - New Enterprise Zone Tax Credits | (Under $100,000) | (Under $100,000) | (Under $100,000) |
| FISCAL IMPACT - Local Government | FY 2002
(10 Mo.) |
FY 2003 | FY 2004 |
| $0 | $0 | $0 |
FISCAL IMPACT - Small Business
This proposal would fiscally impact those businesses that now are considered eligible in the enterprise zone in Salem.
DESCRIPTION
This proposal adds hotels and motels operated in Salem (Dent County) to the list of businesses and activities which qualify as a "revenue-producing enterprise" for purposes of enterprise zone tax relief laws.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Economic Development
Department of Revenue
City of Salem
Jeanne Jarrett, CPA
Director
March 12, 2001