COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 2803-01
Bill No.: SB 636
Subject: Transportation; Taxation and Revenue-Sales and Use; Kansas City
Type: Original
Date: January 21, 2002
FISCAL SUMMARY
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| General Revenue | $0 | $139,366 | $281,519 |
| Total Estimated
Net Effect on All State Funds |
$0 | $139,366 | $281,519 |
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| None | |||
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2003 | FY 2004 | FY 2005 |
| Local Government | $0 | $13,936,606 | $28,151,945 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 3 pages.
ASSUMPTION
Officials of the Department of Revenue (DOR) state this proposal would not fiscally impact their agency.
Officials of the Department of Highways and Transportation (DHT) assume this legislation removes the sunset provision on sales tax for mass public transportation in Kansas City. This bill would give greater long-term financial stability to the Kansas City Area Transportation Authority (KCATA) for transit operating revenue. This proposed long-term funding source would give the KCATA the option to bond for capital improvements. DHT assumes no fiscal impact to its agency.
Officials of the Kansas City Area Transportation Authority (KCATA) state this legislation is very positive for the City and KCATA. The current two year sunset provision makes it very difficult to consider any long term financing mechanism such as bonding for capital projects or equipment. It also creates a certain instability in negotiating contracts such as labor agreements that depend on sales tax revenue. Finally, this legislation will eliminate a discriminatory requirement for approval every two years.
In a response to similar prior legislation, KCATA stated the extension of the Kansas City Transportation Sales Tax, based on current collections, would generate approximately $27.4 million in revenues for FY2003 and $27.9 million for FY2004. This estimate assumes a 1% growth rate. Oversight assumes the revenues in FY2005 would be $28.2 million.
This proposal would result in an increase in Total State Revenues since Collection Fees are included in the General Revenue Fund and general revenues are included in the calculation of Total State Revenue.
| FISCAL IMPACT - State Government | FY 2003 | FY 2004
(6 Mo.) |
FY 2005 |
| Income to General Revenue Fund
1% Collection Fee |
$0 |
$139,366 |
$281,519 |
| ESTIMATED NET EFFECT TO
GENERAL REVENUE FUND |
$0 |
$139,366 |
$281,519 |
| FISCAL IMPACT - Local Government | FY 2003 | FY 2004
(6 Mo.) |
FY 2005 |
| Income to Kansas City Area
Transportation Authority 1/2% Sales Tax |
$0 |
$13,936,606 |
$28,151,945 |
| ESTIMATED NET EFFECT TO
LOCAL GOVERNMENT |
$0 |
$13,936,606 |
$28,151,945 |
FISCAL IMPACT - Small Business
Small businesses would be expected to be fiscally impacted to the extent that they pay local sales tax on taxable items. The extension of the Kansas City transportation sales tax would cause small businesses to continue to pay the local rate for such taxable items.
DESCRIPTION
This act removes the sunset provision for public mass transportation sales tax exceeding 7 ½
percent that was due to expire on December 31, 2003.
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 Revenue
Kansas City Area Transportation Authority
Department of Highway and Transportation
Mickey Wilson, CPA
Acting Director
January 21, 2002