Colorado Legislative Council Staff

STATE

FISCAL NOTE

General Fund Revenue Impact

TITLE:            CONCERNING CLARIFICATION OF THE COLORADO RACING COMMISSION’S AUTHORITY REGARDING REGULATION OF PARTICIPATION IN RACE MEETS.

Summary of Legislation

            Under current law, the Colorado Racing Commission is required to take saliva, urine, blood, or other body fluid samples or biopsy or necropsy specimens from horses and greyhound dogs on a random, statistically valid basis. This bill would remove the requirement that the samples and specimens be statistically valid. In addition, the bill would authorize the Colorado Racing Commission to issue temporary conditional licenses and registrations for a period not to exceed 90 days. License and registration fees would be established at a rate to reimburse the Division for all expenditures directly related to the issuance of the licenses or registrations.

            The bill will become effective at 12:01 a.m. on the day following the ninety-day period after adjournment sine die of the General Assembly, or on the date of the official declaration of the vote of the people as proclaimed by the Governor, if a referendum petition is filed pursuant to Article V, Section 1 (3) of the State Constitution.

             *The Colorado Racing Commission sets fees on a calendar year basis. Therefore, the state revenue estimate identified for FY 1998-99 is based on a six-month impact.

State Revenues

            The Colorado Racing Commission sets the various annual licensing and registration fees in September for the following calendar year. Fee revenue from this source is credited to the state General Fund. The fees for Calendar Year 1998 have been established by the Commission. This bill would require the Racing Commission to establish licensing and registration fees that shall reimburse the Division of Racing Events for all expenditures directly related to the issuance of such licenses or registrations. This will result in fees that are higher than those currently established. Since the bill will take effect 90 days after final adjournment of the General Assembly, it is assumed that the new fees will take effect for the year beginning January 1, 1999.

            The table below identifies the number of license applicants for each license category anticipated by the Division of Racing Events for Calendar Year 1998. In addition, the table identifies the fee structure approved for 1998 by the Racing Commission, the anticipated fee revenue, and the fee structure that would be necessary in order to cover the expenditures of the Division that are directly related to the issuance of the license or registration. Costs not covered by licenses are a General Fund obligation.

            It is assumed that the number of license applications and the cost structure for the Division of Racing Events for Calendar Year 1999 and beyond will closely approximate the estimated number of applications for 1998. Since the amount of revenue required to cover the direct costs of the Division is estimated to be $205,576 annually, and the amount of projected revenue based on the currently approved fee structure is estimated to be $79,440, it is projected that the bill will increase General Fund revenues through increased fee revenue by $126,138 annually. The projected revenue increase for FY 1998-99 is $63,069 for the six month period of January 1, 1999 through June 30, 1999 since the licenses are issued for a calendar year.

            Section 20 of Article X of the Colorado Constitution, limits the maximum annual percentage increase in state fiscal year spending. Once total state revenue from all sources that are not specifically excluded from fiscal year spending exceeds these limits for the fiscal year, the state constitution requires that the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Based on the current Legislative Council economic forecast, it is projected that the state will be in a TABOR refund position during each of the next five fiscal years. Any increase in state revenue from changes in fees, fines, licenses, or other revenue sources will affect the amount of state revenue to be refunded.

Spending Authority

            The General Fund spending authority for the Department of Revenue would be unaffected by the bill.

Departments Contacted

            Revenue