Colorado Legislative Council Staff

STATE and LOCAL

REVISED FISCAL NOTE

(Replaces Fiscal Note dated March 13, 1998)

State General and Cash Fund Expenditure Impact

Local General Revenue Impact

Drafting Number:

Prime Sponsor(s):

LLS 98-878

Rep. Taylor

Sen. Rizzuto

Date:

Bill Status:

Fiscal Analyst:

March 18, 1998

House Appropriations

Scott Nachtrieb (866-4752)

 

TITLE:            CONCERNING THE AUTHORITY OF THE DEPARTMENT OF TRANSPORTATION TO IMMEDIATELY ACQUIRE THE TOWNER RAILROAD LINE AS PART OF THE STATE RAIL BANK, AND MAKING AN APPROPRIATION THEREFOR.


Summary of Legislation


            The bill, as amended by the House Business Affairs and Labor Committee, March 17, 1998, would appropriate $10,400,000 to the Department of Transportation (DOT) from the State Rail Bank Fund to acquire the Towner Railroad Line. The DOT would be instructed to use their best efforts to sell the line by the June 30, 2000. The bill also specifies that the General Assembly shall ensure that sufficient moneys are transferred, appropriated, or otherwise made available in the State Rail Bank Fund for this purpose. The DOT would be authorized to immediately acquire the Towner Railroad Line as part of the State Rail Bank. The bill would become effective upon the Governor’s signature.


STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

State Revenues

General Fund


 


 

State Expenditures

General Fund (School Finance Impact)

State Rail Bank Cash Fund


$286,867

$10,400,000


$286,867

FTE Position Change

None

None

Local Government Impact — Reduced property taxes


State Expenditures


            The bill would allow the DOT to expend $10.4 million from the State Rail Bank Fund to purchase the Towner Railroad Line. Currently, the State Rail Bank Fund does not contain funds for this appropriation. However, the Joint Budget Committee has allocated $10.4 million from the Capital Construction Fund to the State Rail Bank Fund in the soon to be introduced FY 1998-99 Long Appropriations Bill.


            The bill would result in a reduction in property tax collections for units of governments in Pueblo, Kiowa, Crowley, and Otero counties (see the Local Government Impact section below). However, since state aid for schools is computed as the difference between Total Program and the amount collected from property taxes and specific ownership taxes, state aid would be increased to make up for the lost operating budget from decreased property tax revenue through the School Finance Act in affected school districts. The need for additional state aid through the School Finance Act identified in this bill is estimated to be $286,867.


            Without this bill, it is assumed that the railroad line would be abandoned and the title to the property in the abandoned line would revert to the adjacent legal property owners. The owner who would receive ownership of the abandoned property would pay taxes based on the property’s new assessment rate. It is estimated that the School Finance Act would be impacted, but at some lower level from the change in the classification of the property from public utility property.


Local Government Impact


            The state purchase of the Towner Railroad line right-of-way would remove the right-of-way from property taxation. This would reduce property taxes to local governments by approximately $667,133 annually. Of that amount,$286,867 would be public school funds and the remaining $380,266 would be distributed to other entities within the county that impose a mill levy for property tax purposes.


Spending Authority


            The bill contains an appropriations clause for $10,400,000 from the State Rail Bank Fund to the Department of Transportation. The provisions of the bill would require an increase in the FY 1998-99 appropriation for the Department of Education, Public School Finance, Total Program of $286,867.


Departments Contacted 


            Transportation            Local Affairs