Colorado Legislative Council Staff

STATE and LOCAL

FISCAL IMPACT


Drafting Number:

Prime Sponsor(s):

LLS 99-0348

Rep. Zimmerman

Date:

Bill Status:

Fiscal Analyst:

January 12, 1999

House Local Government

Steve Tammeus (866-2756)

 

TITLE:            CONCERNING A LIMITATION ON THE AGGREGATE AMOUNT OF GOVERNMENT TAX INCENTIVES GRANTED FOR THE PURPOSE OF ENCOURAGING LAND DEVELOPMENT.



Fiscal Impact Summary

FY 1999/2000

FY 2000/2001

State Revenues

General Fund

Additional General Fund Revenue

State Expenditures

General Fund

 

 

FTE Position Change

0.0 FTE

0.0 FTE

Other State Impact: TABOR

Effective Date: Upon signature of the Governor.

Appropriation Summary for FY 1999-2000: None.

Local Government Impact: Will increase tax revenue to local governments for tax years 2000 through 2009.



Summary of Legislation


            This bill limits the aggregate amount of tax incentives that state and local governments may grant to individuals, estates, trusts, domestic C corporations, or foreign C corporations to encourage land development. Beginning January 1, 2000, the amount of the tax incentive is limited to 25.0 percent of the estimated aggregate tax revenues generated at the state and local levels by the proposed land development. Any tax incentives granted by state or local governments shall be for a period of no greater than five years. The provisions of the bill do not apply to any tax incentives granted prior to January 1, 2000. The provisions of the bill are to be repealed December 31, 2009.



State Revenue


             This bill will not affect tax incentives that are currently in place. However, the bill will limit the amount of tax incentives to be granted for certain land developments between January 1, 2000 and December 31, 2009 which is anticipated to increase the amount of future tax revenue to the state. This fiscal note cannot ascertain the extent to which the 25.0 percent limitation or the five year limitation will affect the amount of future tax incentives to be granted for those land developments.


State Expenditures


            This bill specifies that the aggregate amount of the tax credit is to not exceed 25.0 percent of the estimated aggregate tax revenues generated at the state and local government level by the proposed land development. The bill is silent on how the amount of the aggregate tax revenues will be determined. Therefore, this fiscal note cannot assess whether the state will incur additional expenditures to administer and enforce the provisions of the bill.



Local Government Impact


            This bill will not affect tax incentives that are currently in place. However, the bill will limit the amount of tax incentives to be granted for certain land developments between January 1, 2000 and December 31, 2009 which is anticipated to increase the amount of future tax revenue to local governments. This fiscal note cannot ascertain the extent to which the 25 percent limitation or the five year limitation will affect the amount of future tax incentives to be granted for those land developments.


            The bill is silent on how the amount of the aggregate tax revenues will be determined. Therefore, this fiscal note cannot assess whether local governments will incur additional expenditures to administer and enforce the provisions of the bill.



Departments Contacted

 

            Local Affairs              Revenue