Finance & Revenue

State: Nebraska

The Legislation: Nebraska LB 730 (2018)

The ammunition tax rate:  10%

Tax revenue will be dedicated to fund: wildlife conservation & domestic violence

Tax would generate:  $4.1 million/year

KSYZ-FM | Ammunition tax bill heard in legislature

The State: Massachusetts

The US Supreme Court Issue: New Jersey’s challenge to federal prohibition on sports betting heard by the highest court in December 2017

The Bill:  SD 2480    requires:

• 15% gross revenue tax on daily fantasy sports operators
  • a lower tax rate than the state’s casinos
  • comparable to fantasy sports  tax rates in NY and PA
• consumer protections- such as gmaing age
• oversight by the Massachusetts Gaming Commission
• registration fee up to $100,000 and set by the Gaming Commission

Sentinel & Enterprise | Fantasy sports bill is good bet for all
Glouster Times | Bill features fantasy sports tax, pro sports betting panel

Concord Monitor | Mass. lawmakers consider 15 percent tax on daily fantasy sports

Harris County Attorney Vince Ryan has requested an Attorney General Opinion as to whether the Harris County  Department of Education can create a Hurricane Harvey Relief Fund?

What’s the goal of the Relief Fund? To “provide grant funding to independent school districts located in Harris County to assist with recovery efforts after Hurricane Harvey “

How would the Relief Fund be funded? public funds, tax proceeds generated from Harris County  Department of Education countywide equalization tax 

What else do we need to know about the Relief Fund? 

• funds would support an HCDE public purpose
• Its an exception to Article III, §§ 52 and 53 ofthe Texas Constitution prohibiting gifts of public funds because Hurricane Harvey meets the exception for a public calamity

Texas Attorney General Opinion Request RQ- 0208-KP

The Partnership Advisory Commission, The Texas Facilities Commission & P3 Guidelines walk into a bar, 4 revisions to P3 guidelines emerge, no joke.

Revised P3 guidelines at the Facilities Commission will require:

•  project selection analysis before procurement
• “public purpose” requirement (hello, eminent domain terminilogy):
  • a public need or benefit
  • estimated cost is reasonable AND
  • private entity participation will allow for timely development or operation
• evaluation criteria:
  • monetary savings
  • community impact
  • past performance of the proposed bidder

BISNOW | Lawmakers Sign Off On P3 Guidelines For Capitol Complex
 

Opponents to education savings accounts in Pennsylvania say ESAs are:

• “vouchers on steroids”
• ““It’s like finding a man in a well and pulling out the only rope available to him to escape from his situation.”

Daily Item Harrisburg | Education supporters prepare to fight ‘vouchers on steroids’

Kentucky’s gas tax proposal, House Bill 211 will:

• 3 cents additional gas tax
• re-brands the icrease from “gas tax” to “school transportation funding fee”
• the new funds will be specifically dedicated to school transportation

The revenue estimates from a 3 cent school transporation fee in Kentucky:

• $90 million in new revenue
• $30 million to be used for bonds for new buses
• the remaining $60 million will go to the state’s share of school transportation funding

News-Enterprise | Lexington official proposes gas tax to help school transportation costs

The economic development board: Pasadena’s economic development board AKA the Pasadena Second Century Corp

The alleged violation of the opening meetings act:   6 board members. 2 private meetings with a contractor.

What did the baord think it was doing? It thought it was not triggering the open meetings act by subdividing into groups. 

What did the board actually do? Violated the “walking quorum” provision of the Open Meetings Act.

Why does this matter: Special Districts accused of running amock + transparency + tax dollars = legislative reform

Houston Chronicle | Six current, ex-members of Pasadena economic board indicted for private meetings

US News & World Report | Members of Houston-Area Board Indicted for Private Meetings

To recap: The 5th Circuit said under current hotel tax statutes, cities, like San Antonio couldn’t collect taxes on amounts not included in the hotel occupancy tax base.

Where are we now? San Antonio has asked the 5th Ciruit to reconsider its ruling by considering San Antonio’s local hotel tax ordinance.

Which cities are involved in this suit?

• Houston opted out to pursue state court options
• 173 Texas cities remain in the class action lawsuit

How long has the lawsuit been trucking along? 10+ years

Southeast Texas Record | San Antonio asks federal appellate court to reconsider opinion in hotel occupancy tax verdict

The Nebraska Legislature is considering LB 469  that regulates fantasy sports. Opponents stopped the bill procedurally.

The opponents to LB 469:

• the author is trying bamboozle the chamber
• not enough consumer protections
• takes advantage of citizens
• codifies online gaming
• gambling addiction causes emotional and financial devistation

Omaha World Herald | Opponents block vote on senator’s proposal to regulate fantasy sports contests

In 2016 Lousiana passed a sales tax for online sales from retailers with no physical presence in the state.

In 2018, the online sales tax begins and here’s what’s happening:

• consumers will receive notices of sales taxes owed from 2017 purchases
  • retailers will send notices to consumers
• Retailers will also have to provide annual reports to LA’s Department of Revenue that detail what LA consumers spent in the previous year
• The goal isn’t to target mom-and-pop stores, the law targets out-of-state internet retailers with gross receipts of more than $50,000

LA’s law was modeled after CO’s law that has withstood court scrutiny

AP via Times-Picayune | Louisiana starts collecting unpaid internet sales taxes

First came, CALPERS, then New York City joined in to divest its pension system from oil and gas, and now calls are coming for the Illinois to divest.

Pension divestment from oil and gas interests is entering the Illinois Governor race. 

The campaign messaging: “Illinois should divest its pension funds from investments in dirty energy.”

News-Gazette | Biss calls for state pension funds to divest ‘dirty energy’ investments

Texas Attorney General letter ruling  found that a survey from a city council member is not disclosable because no city resources went into conducting the survey.

What’s the big deal about a councilmember surveying his or her constiuents? The question in the survey was an issue before the city council for a vote.

What was the survey question? SHOULD THE CITY OF FORT WORTH JOIN OTHER CITIES IN THE SUIT AGAINST SB4?

Fort Worth Star Telegram | Fort Worth councilman doesn’t have to release results of website survey, Paxton rules

Who is suing whom?  Retailers are suing Laredo over Laredo’s plastic bag ban,  Laredo Merchants Association v. The City of Laredo, 

Who won most recently in the lower courts?  The Merchants Association

What did the lower courts say? Court #1  sided with the city, upholding the plastic bag ban. Court #2, the appellate court sided with the merchants

Can this effect Austin, Port Aransas or Fort Stockton’s bag ban? yes

What’s 2019 legislation going to focus on regardless of who wins:  Texas Health and Safety Code, section 361.0961:  local governments may not “prohibit or restrict, for solid waste management purposes, the sale or use of a container or package in a manner not authorized by state law.” Did this or does this mean plastic bags?

City supporters say:  “Extreme uniformity and regulation fails to address diverse local concerns”

Merchant supporters say: that “inconsistent local laws like the plastic bag bans seen in cities across Texas cause unnecessary strain on small businesses.”

Was there a 2017 bill? Yes, it created a new Business and Commerce Code section affirming the right to use any bag  packing. Texas SB 103 (2017)

 Laredo Merchants Association v. The City of Laredo,  16-0748

KUT | State Supreme Court Case Could Bring An End To Plastic Bag Bans In Texas

Add New York City to the list of pensions that are tasked with divesting from fossil fuel investments. 

What other pensions have been charged with divesting from oil? CALPERS and Norways’ sovereign fund 

The $189 Billion pension is charged with divestment within: 5 years

Why? NYC is especially atune to rising sea levels which result from climate change

CNN Money New York City to Exxon: Pay up for climate change costs

Annual revenue NY receives from daily fantasy sports:  More than $3 million

How many companies contributed to the $3 million in revenue? 15

Is there a cap limiting expansion of the 15 companies? Yes, the companies cannot expand until the Gaming Commission adopts rules. 

AP | Online fantasy sports raise more than $3M for New York state

Wyoming increased its revenue from leasing land to oil and gas companies by mor than 800%.

Why did leasing get a sharp uptick: Most say its due to the use of a new online lease auction system

US News & World Report | Wyoming’s Lease Revenue Climbs by 800 Percent This Year

New Jersey Governor Chris Christie signed a pension bill that codifies pension practices of stress tests and disclosure of investment fees. 

Pensions & Investments | Chris Christie signs bill requiring stress tests, fee transparency at state pension funds

Nashville City Council by voice vote passed an ordinance dubbed “Do Better” to require corporations to dislcose more information in economic development deals.

Corporations will now have to disclose the following in economic devleopment deal making:

• how many county residents they plan to hire
• anticipated wages
• 7 years of health and safety violations
• any wage-related lawsuits against the company or contractors

The Tennesseean | Nashville council passes new transparency rules for future city incentives

New Hampshire Legislature is considering educational savings accounts in SB 193 (2017-2018).

Opponents make the following arguments against ESAs:

• ESAs will destablize slow growth districts
• ESAs will cause school districts to receive less state aid and will increase the burden of fixed costs on already cash strapped districts
• ESAs will “disproportionately harm property-poor municipalities” while adversely impacting the quality of education
  • The loss of 5 students would exceed the cost of 1 teaching position

NH Eagle tribune | Hampstead speaks out against SB193

New Jersey Legislature is considering S3195 & A4872    to legalize and tax marijuana. 

The bill will create a sliding sales tax of:

• 7% to 25% over 5 years to encourage early participation

Other regulatory and enforcmement provisions are:

• Permit those 21 and older to possess up to 1 ounce of marijuana, 16 ounces of marijuana-infused products in solids, 72 ounces in liquid form and 7 grams of concentrate
• Prohibit home cultivation
• Create the  Division of Marijuana Enforcement to regulate the industry

Corresponding legislation dedicates the a portion of the revenue to medical treatment and research.

Burlington County Times | Millionaires’ tax, marijuana, minimum wage atop agenda for New Jersey Legislature

Where is this happening: D.C.

How does the program work? City employees contact a taxi participating in the city’s “Vehicles on Demand” pilot. 5 to 10 minutes later, a driver picks her up, checks her employee ID and takes her to her destination.

Benefit to the city: Cuts employee transit time in 1/2

Governing | How Public Employees Could Power the Struggling Taxi Industry

In 2017, a statewide ride share bill failed in Alabama. 

2018 brings another attempt at statewide ride share regulation, and local governments are talking ride share revenue:

• statewide regulation could mean the state getting its hands on local ride share tax revenue
• statewide regulation also shifts licensing fees from local revenue to state revenue

WBRC | Another statewide ride hailing regulation bill could be proposed in upcoming session

Follow in the footsteps of Adrian, Michigan and permit and tax medical marijuana facilities from growers to processors to provisioning centers to safety facilities to secure transporters. 

Forget 3 taxing tier systems. That’s so 1999. Welcome 2017 and tax 6 tiers! 

The 4 reasons Adrian, Michigan commisioners supported permitting and taxing marijuana facilities: 

• Jobs that pay $15-20/hour
• Funds for blight elimination
• Economic development
• Compassion for medical marijuana patients

LenConnect | Adrian OKs medical marijuana facilities

The Tax Foundation lists these state tax policy issues trending:

• Gross Receipts Taxes- 5 States Have it; 8 States Considering it
• States Want to Tax online Sales
• States want to tax and legalize marijuana
• Reducing Taxes on Capital
• How to balance tax incentives with smaller tax bases

Add Texas State Senator Craig Estes to the list of Texas officials promoting the demise of the Texas Franchise Tax/Margins Tax.

Where will the $9 Billion per biennium in franchise tax revenue come from? Economic growth that occurs when the franchise tax/margins tax is gone.

Midland Record Times | State senator wants to eliminate business franchise tax

Texas Legislature’s 2017  creation of the University Hills Municipal Management District has given rise to the following concerns about this and similar special districts:

• A Dallas City Council member described the process as “comes across a bit shady.”
• Irving taxpayers had to bail out Las Colinas when its district’s debt ballooned
• Dallas has no representation on the district’s initial board
• Former Westlake Mayor calls special districts “undemocratic”- an extra layer of regulation & taxation

Dallas Morning News | A plan hatched by a developer and a politician to grow southern Dallas raises eyebrows at City Hall

STEP 1: pass a bill to create a committee to study transportation funding. Like Missouri did with the 21st Century Missouri Transportation System Task Force, 23-member task force of state officials and private citizens

STEP 2: Have the Chair of the Senate Transportation Committee & vice-chair of the 21st Century Missouri Transportation System Task Force file a bill like Missouri’s SB 734  to raise the gas tax

STEP 3: Garner support from truckers and mayors for your bill.

STEP 4: Have your bill give voters final approval to increase the gas tax by 10cents

LandLine Mag | Missouri bill would increase fuel tax 10 cents

The Tax Foundation highlights 5 lessons that legislators can learn from the tax reform process in North Carolina, Indiana, Kansas, and Oklahoma:

• It is a process.  Be patient. Be methodical. Be thoughtful
• It is not just about cutting revenue. Must also identify tax or spending changes to offset the cuts
• Must contain spending controls. Tax reform and spending controls must by symbiotic.
• Design Tax triggers. When a certain revenue level is reached, a trigger can lower taxes, but it must be tied to starting point for the revenue level. A simple increase of revenue alone isn’t enough.
• It is worth it. Greater economic opportunity does come from tax reform

Tax Foundation | Arkansas Tax Reform: Lessons from Other Legislators

The 5th Circuit ruled that the Texas Hotel tax does not include the fee an online service provider charges.

What is practical effect? lower courts valued the tax on the service fee at $84 Million for the class of Texas cities 

What does this legislatively?  A legislative fix to include taxing the service fee

Law 360 | 5th Circ. Wipes Out $84M Hotel-Tax Win For Texas Cities

Supporters of retaining sales tax exemptions to whether the exemption supports economic development: Wyoming Association of Municipalities

Why does the WY Assoc. of Municipalities want to reign in sales tax exemptions?More reliable and greater local taxing authority

What is the concern WY cities have with the state tax structure? Relying on energy taxes and state revenue for local government funding has proven to be unreliable

What 4 tax reforms are being proposed?

• increase the severance tax cap from $155 to $214 million
• cap for federal mineral royalties be raised from $200 to $275 million
• increasing the state-wide sales tax from 4 to 5%
• cutting any of the state’s 39 tax exemptions that are not found to support economic development

 Casper Star Tribune | Group advises Wyoming Legislature to give local governments more taxing authority

New Orleans has changed its pension rules for new hires by:

• COLA limitations.  New hires would receive cost of living adjustments only if the pension is nearly fully funded.
• Salary CAP for pension calculations. Caps salaries at $100,000 for the purpose of pension calculations only
• Slow pension benefits. Pension benefits asccrue at a slower rate.

No pension changes were made to current employees.

New Orleans Advocate | New Orleans City Council approves pension changes for new city hires

No more swag for state agencies in Oklahoma. 

According to Oklahoma Governor MAry Fallin state afencies spend $58 million per year on swag. Because everyone needs a Coproration Commission Stress Ball or key chain. 

Governor Fallin signed an executive order prohibiting state agency promotional items. 

Governing | Amid Budget Crisis, Oklahoma Governor Bans ‘Swag’ Spending

TPPF newly launched Texas Prosperity Promise has 1 principles, including eliminating the property tax for an expanded sales tax.

The expanded sales tax would be:

• 15.7% is the sales tax base remained the same, including the sale of propert-y OR-
• 11% if services, taxed in 1 other state, were also included + a sales tax on the sale of property

TPPF | Texas Propserity Promise linking to the 2017-2018 Guide to the Issues

State: Ohio

The fantasy sports regulations that passed:

•  licensing
•  investigation
• regulation
• enforcement by the same state agency with oversight over the casino industry

The tax fail: A 6%t tax to help the state cover the costs of addiction and other social problems failed to pass

What tax would fantasy sports businesses face in ohio? the existing gross receipts tax of 0.26 %

The Toledo Blade | Lawmakers vote to expressly legalize fantasy sports games

The Tahoe-Reno Industrial Center, touted as the largest industrial complex in the world is on an economic development winning streak because:

• The businesses are at the forefront:
  • Tesla’s Gigafactory
  • Google
  • Switch
  • Jet.com and Walmart
  • eBay and Zulily
• An exceptional absence of local regulation
  • The county has 845 residents and the businesses employ 3 times as many people
  • Land puchase agreements for the industrial park prohibis the county from imposing any new fees or regulations
• A unique head of economic development who formerly worked for  Capitol Records in Hollywood & then created small businesses

Governing | Deep in the Desert, an Experiment in Economic Development 

Ray Perryman highlighted 3 keys to Texas economic success in his testimony before the House Select Committee on Economic Competitiveness:

• Ensuring quality education adapts to all demographic growth and shifts
• Avoiding discriminatory social legislation like the “bathroom bill”
• Maintaining economic development programs

Rio Grande Guardian | Perryman: Keys to Texas’ Economic Success

The report is by: National Conference on Public Employee Retirement Systems

3 Conclusions from the state and local pension obligation report:

•  state and local pension plans have been able to meet their obligations consistently over the past 25 years
• contributions and investment earnings by 6,000 public pension plans between 1993 and 2016 exceeded benefit obligations in all but four years of the national recession
• during the recession, the pensions were able to meet their obligations because they had built up reserves during normal times

4 recommendations

• Stop dismantling plans on grounds that they are not fully funded.

• Improve funding by determining the appropriate levels of required employer contributions.

• Establish a pension stabilization fund that can set aside money from a certain revenue stream to be used in special circumstances, such as a recession.

• Implement a mechanism to ensure that full employer contributions are made on a timely basis, for example, by making employer contributions a nondiscretionary part of the budget.

Chief Investment Officer | Report: Public Pension Plans Consistently Meet Obligations

Kansas Courts have declared its school financ esystem unconstitutional.

A proposal to amend the Kansas Constitution would:

• keep school finance budgeting issues out of the courts
• limit school finance to the Legislature by  including the language:
  • “As determined exclusively by the Legislature, the Legislature shall make suitable provision”

WIBW | KU Law Professor says amending state constitution is potential school finance solution, but a tough task

Athens is considering adding a freeport tax exemption.

What is a freeport tax exemption? An inventory-based property-tax exemption on inventory that is in Texas for a period of 175 days or less, and which will be taken outside of Texas

Is it common? 21% of Texas cities offer it

Is it complicated?  Municipal utility districts also must =grant the exemption, if a businesses apply

How often must businesses apply? Every year

Athens Daily Review | Athens city officials consider offering freeport tax exemption

Arkansas Public Employees Retirement System’s trustees increases the employer contribution rate from 14.75% of payroll to 15.32% of payroll.

What caused the increase in the employer contribution rate? The projected annual investment return was reduced from 7.5% to 7.15%

Arkansas Online | State pension panel increases rate charged to governments

Sweden is requiring sexual conduct education before awarding film incentives.

The Hollywood Reporter | Sweden to Require Sexual Conduct Education for Companies Applying for Film Subsidies

Attorney General Opinion Request RQ-0191-KP asks whether school boards can adopt term limits as part of the local school district’s governance policies.

From Chair Jody Laubenberg’s opinion request letter: 

The state high school basketball tournament: McDonald’s Texas Invitational Basketball Tournament (high school basketball)

The local economic benefit over 3 days: $2.7 Million

Visitors that travel for the tournament: 50,0000

Houston Chronicle | Pasadena, Deer Park prep for massive Texas Invitational tourney

11 of the 120 local bond elections on November 7, 2017 were defeated. What did the defeated bonds have in common?

• not in the state’s largest cities or counties
• more than 1/2 were for schools or athletic fields
• the largest bond package defeated was $291 by Ector ISD

Texas Comptroller | Bond Election Results 

Refreshing our recollection:

The $500 Million + bond ballot items:

• Austin ISD $1,050,984,000 for New Schools, School Improvements, Technology, Transportation
• City of Dallas $533,981,000 for streets and transportation
• Eagle Mountain Saginaw ISD (Tarrant Co.) $524,700,000 for New Schools, Growth, Athletic Fields and Security
• Ft. Worth ISD $750,000,000 for New Schools, Renovations and Additions
• Katy ISD $609,204,553 for New Schools, Renovations, Expansions, Technology and Security

The little guys:

• Coahoma ISD $4,000,000 for Atheltic fields
• Dekalb ISD $2,500,000 for Gymnasium
• Farmers Branch $4,000,000 for Street and Station Improvement
• Farmers Branch $4,000,000 for Neighborhood Improvements
• Grapevine $3,900,000 for Animal Shelter
• Grapevine $4,800,000 for Golf course
• Highland Village $2,860,000 for Reconstruction of Streets
• Highland Village $4,290,000 for Park and Recreation
• Laneville ISD $3,794,000 for School Additions and Renovations
• Laneville ISD $2,949,000 for New Gym and Auditorium
• Little Elm ISD $4,500,000 for Refunding
• Mineral Wells $3,960,000 for Installing Water Line
• Murphy $1,735,000 for Public Safety Facilities
• Murphy $1,315,000 for Improvements to Municipal Building
• Murphy $4,400,000 for Parks and Recreation
• Plainview $3,800,000 for Firestation
• Plainview $3,800,000 for Pool Project
• Plainview $1,480,000 for Street Scape Plan
• Plainview $1,500,000 for Athletic Fields
• Waller $1,315,000 for Civic Center

The local governmental entity breakdown:

•  49  Cities
• 56  ISDs
•  1 Community College District 
• 11  Counties
•  2  Water District
•  1  Navigation District

Texas Comptroller Upcoming Election Roundup

The annexation plan of Ranger College that included anop-ed from the Erath D.A. refuting allegations that opponents would be prosecuted, has failed to pass.

Those touting victory include Empower Texas | WEST TEXANS DEFEAT BIG GOVERNMENT BY INCREDIBLE MARGIN

The measure was defeated 97% to 3%.

Refreshing our recollection: 

Where on earth is this happening? Erath County Texas

What tax increase is involved? An election concerning  Ranger College annexation and taxation involving a potential 43 cent property tax.

How did the District Attorney Get Thrown Into This?

• In several Erath Co. publications, supporters of Ranger College threatened that the D.A. would bring felony bribery & coersion charges against the opposition. Seriously.
• The Erath Co. District Attorney published an Op-Ed to dismiss the claims completely.

Stephenville Empire Tribune | DA responds to Ranger College

The state: Oregon

Goal of the Pension Task Force:  How to reduce the unfunded liability in Oregon’s pension systems

The recommendations:

• harvesting some of the state’s timberland
• selling state-owned real estate
• privatizing state universities
• creating a new investment fund for the excess cash held on the balance sheets of cities, counties and school districts
•  transfer surplus capital held by Oregon’s hybrid workers’ compensation system

Pensions and Investments | Oregon task force identifies measures to reduce unfunded pension liabilities by about $5 billion

Tennessee is getting in the game of gift cards for state parks, just in time for the holidays.

The details about Tennessee’s state parks gift cards:

• will range in value from $20-$500
• available at grocers and online retailers
• will work at any of Tennessee’s  36 campgrounds, 40 gift shops, 21 parks with cabins, nine golf courses, six inns, eight restaurants and three marinas

The legislative work that made it happen:

• $135 million in capital investment to address the backlog of $125 million deferred maintenance
• state park entrance in Tennessee remains free

Knoxville News-Sentinel | Gift Cards to State Parks? Tennessee Will Be the First to Offer Them.

Denver for the first time is allowing a P3 consortium of interest to take over concessions and airport renovations for the next 34 years. 

Contract value: $1.8 billion agreement

Contract lead: Spanish company Ferrovial Airports

3 concerns raised over the airport P3:

• airline carriers in Denver are worried about fee increases
• citizens have raised concerns about  accountability
• citizens have raised a concern over a foreign contractor in charge

The airport contract encouraged Denver to move forward on P3s for 3 more projects:

• expand the convention center
• renovate the performing arts center
• convert the National Western Center into a campus for food and agriculture research and development

Governing | Denver Turns to P3s to Manage a Major Function

The $500 Million + bond ballot items:

• Austin ISD $1,050,984,000 for New Schools, School Improvements, Technology, Transportation
• City of Dallas $533,981,000 for streets and transportation
• Eagle Mountain Saginaw ISD (Tarrant Co.) $524,700,000 for New Schools, Growth, Athletic Fields and Security
• Ft. Worth ISD $750,000,000 for New Schools, Renovations and Additions
• Katy ISD $609,204,553 for New Schools, Renovations, Expansions, Technology and Security

The little guys:

• Coahoma ISD $4,000,000 for Atheltic fields
• Dekalb ISD $2,500,000 for Gymnasium
• Farmers Branch $4,000,000 for Street and Station Improvement
• Farmers Branch $4,000,000 for Neighborhood Improvements
• Grapevine $3,900,000 for Animal Shelter
• Grapevine $4,800,000 for Golf course
• Highland Village $2,860,000 for Reconstruction of Streets
• Highland Village $4,290,000 for Park and Recreation
• Laneville ISD $3,794,000 for School Additions and Renovations
• Laneville ISD $2,949,000 for New Gym and Auditorium
• Little Elm ISD $4,500,000 for Refunding
• Mineral Wells $3,960,000 for Installing Water Line
• Murphy $1,735,000 for Public Safety Facilities
• Murphy $1,315,000 for Improvements to Municipal Building
• Murphy $4,400,000 for Parks and Recreation
• Plainview $3,800,000 for Firestation
• Plainview $3,800,000 for Pool Project
• Plainview $1,480,000 for Street Scape Plan
• Plainview $1,500,000 for Athletic Fields
• Waller $1,315,000 for Civic Center

The local governmental entity breakdown:

•  49  Cities
• 56  ISDs
•  1 Community College District 
• 11  Counties
•  2  Water District
•  1  Navigation District

Texas Comptroller Upcoming Election Roundup

Connecticut legalized fantasy sports by adding a provision to its state budget bill.

How do you legalize fantasy sports in a state budget? Beginning on page 764, you add in the entire fantasy sports legalization bill complete with regulation by the Connecticut Commissioner of Consumer Protection.

Are there extenuating circumstances in Connecticut? yes, the state went 116 days without a budget & has a $3.5 Billion deficit. 

Legal Sports Report | Connecticut’s Governor Signs Budget With Daily Fantasy Sports Regulation; Still Needs Tribal Approval

Pennsylvania Legislature is moving a omnibus gmabling bill that will:

• legalize & regulate daily fantasy sports
• legalize sports betting

Why add the sports betting? In December the U.S. Supreme Court will hear New Jersey’s challenge to the federal sports betting ban. Adding sports betting into the mix gives PA a leg up at legalization.

What regulatory structure is Pennsylvania considering?

• Overesight by the PA Gaming Control Board.
• $50,000 for five years of licensure for operators
• Taxes gross revenue at a rate of 15%
• Consumer protections like gaming protocols and forcing sites to segregate player funds and operational funds.

Legal Sports Report | PA Closes In On Legalizing Sports Betting, Regulating Daily Fantasy Sports

Philadelphia Inquirer | Pa. legislature expands gambling, borrows $1.5 billion to balance budget. Will Gov. Wolf sign?

Who: Texas State Rep. Shaheen

His argument to end the Texas film incentive program & The Texas Film Commission: 

• Texas shouldn’t be in business with Hollywood. By way of example he offers Harvey Weinstein.
• Inappropriate use of Texas tax dollars
• ““I have always believed that this is an inappropriate use of taxpayer dollars,” Shaheen said. “And given the apparent culture of sexual exploitation of women in Hollywood, it is now even more clear that we should not be wasting taxpayer money on this industry.”

NBC DFW | Plano Lawmaker Pushes to End Texas Film Commission, Cites Harvey Weinstein

Current system: A legislator may combine pay from other state government positions to calculate pay in the elected official pension system.

Proposal supported by the Republican Governor and Top 2 legislative leaders: Remove the ability to use pay from other state government positions.

Effect of proposal: Reduce the pay outs to elected officials.

Is the state elected official pension system well funded in Kentucky? Yes

Michigan Radio via AP | Pension Proposal Would Strip Benefits from Some Kentucky Lawmakers

Senate State Affairs

Acturarial Assumptions. Financial Disclosures. Pensions: Examine and assess public pension systems in Texas. Specifically, review and assess (1) the different types of retirement plans; (2) the actuarial assumptions used by retirement systems to value their liabilities and the consequences of amending those assumptions; (3) retirement systems’ investment practices and performance; and (4) the adequacy of financial disclosures including asset returns and fees. Make recommendations to ensure public pension system retirees’ benefits are preserved and protected. 

Monitoring Local Pension Bills from the 85th. 

Galveston County Auditor requested an Attorney General Opinion on whether :

• Is a taxing unit justified therefore for funding only those reasonable additional costs of the reappraisal? 
• Since a disaster reappraisal typlcally results in a reduction in value, is notice required when a property value is decreased? 
• In the event the response to II above Is that notice is not required, does the Code provide for a later correction should the reduced amount be insufficient in the opinion of the property owner? 

RQ- 0188-KP

A Pennsylvania State Senator filed SB 2  to create educational savings accounts for student sin low performing schools. 

What do I need to know about the author?

• Republican
• Small Business Owner
• Represents northwest Harrisburg

What do I need to know about the ESAs for students in low performing schools? Funds will be able to pay for:

•  tuition and fees at a participating private school
• payment for a licensed or accredited tutor
• fees for nationally norm-referenced tests and similar exams
• industry certifications
• curriculum and textbooks
• services to special education students such as occupational, speech, and behavioral therapies

PA Senator DiSanto SB 2 memorandum

Heartland Institute Policy Tip Sheet | EDUCATION SAVINGS ACCOUNTS IN PENNSYLVANIA

Where on earth is this happening? Erath County Texas

What tax increase is involved? An election concerning  Ranger College annexation and taxation involving a potential 43 cent property tax.

How did the District Attorney Get Thrown Into This?

• In several Erath Co. publications, supporters of Ranger College threatened that the D.A. would bring felony bribery & coersion charges against the opposition. Seriously.
• The Erath Co. District Attorney published an Op-Ed to dismiss the claims completely.

Stephenville Empire Tribune | DA responds to Ranger College 

Texas Public Policy argues to stop economic development and lure businesses with the ‘Texas model.’

The jist of their argument:

• Economic development tax abatements for coporations have cause residential property taxes to raise 80% since 2007
• Unfair economic competition
• Government shouldn’t pick winners & losers

What should replace tax incentives and abatements?

• limiting yearly property tax increases;
• easing land-use restrictions to increase housing stock;
• eliminating unfriendly regulations;
• relaxing building-code requirements; and
• generally reducing the cost of city government.

TPPF | STOP DEVELOPMENT DEALS. GET AMAZON WITH THE ‘TEXAS MODEL’ 

Norway is considering imposing a tax on electric vehicles based on the vehicle’s weight. 

This tax structure impacts the 2500kg Tesla Model X, which weighs considerably more than other EVs. A Tesla X could cost an additional $8,8500.

Policy behind the tax: Electric vehicles cause more road damage than other, lighter vehicles.

Business Insider Nordic | Is the ‘Tesla Tax’ coming to Sweden?

AutoBlog | Tesla tax’ could hit Norway, the world’s top EV market

The Mike Collier (D) campaign for Lt. Governor of Texas is focusing on property taxes, and here’s what they’re saying:

• The Constitution is against home owners and small business owners who suffered in Harvey. The Constitution doesn’t allow for lost value assessments, like the lost value after a major storm.
• Its wrong for elected officials to say its too much of a hassle to reappraise storm ravaged property.
• Big oil and big corporations are under paying property taxes and would pay the legal costs to fight an assessment on stgorm ravaged property, shifting more of the burden on residential and small businesss owners.

Corpus Christi Caller Times | Texas homeowners and small businesses continue to get rotten property tax deal

The Oregon PERS UAL Task Force crafted a laundry list of proposals to reduce unfunded pension liability, including:

• Forfeiture and Debt Collection revenues going to pensions and not the jurisdiction the unpaid amount is owed
• Use Urban Rrenewal Funds
• Collection of past deferred billing credits to commercial entities
• Sunset property tax exemptions in enterprise zones
• Severence  Tax on Exctrative Industries like timber

Oregon Live | PERS: Task force seeks $5 billion in pension savings

Michigan’s HB 4999, which is expected to be signed by Governor Snyder, would preempt all local sales and exicse taxes that target specific foods and beverages.

What type of legislator files a bill to preempt local taxing authority? Republican who files zero based budgeting bills

Sacramento Bee | Michigan Legislature votes to ban local food, beverage taxes

The Republican Senate Leader in this state: Kentucky

The pension problem Kentucky wants to fix: the $30-$70 billion in unfunded pension liability

What type of legalization: The legalization of marijuana would apply to the legalize the production, sale and consumption of marijuana for adults

The proposed revenue generation: $100 M per year

The top 2 Kentucky pension systems are asking the legislators for: $5.4 billion to the pension funds over the next two years

WFPL | Senate Leader Floats Marijuana Proposal As Pension Fix

What you need to know about Speaker Straus’ newly appointed Select Committee on Economic Competitiveness:

• The committee has 60 days to wrap up its work (report due 12/12/17)
• The committee will look at workforce readiness, infrastructure and state and local economic development tools
• The Committee has a specific charge to “study the reasons that employers give for choosing, or not choosing, to do business in a particular state.”

Committee Members:

• Chairs: Cook & Senfronia Thompson
• Sarah Davis
• Charlie Geren
• Angie Chen Button
• Joe Moody
• Rene Oliveira

Committee Goals:

• “reassert that Texas is fully committed to private-sector growth”
•  “highlight the principles that the Texas House believes are critical to economic growth”
  • Speaker Straus said. “But there’s more to the formula. Businesses want to grow in places that have outstanding schools, colleges and universities, as well as a high quality of life for their employees. This committee will articulate principles of economic growth in Texas and show that the House is committed to competing in a global and changing economy.”
• It is not only CEOs that are watching Texas, but also “the best and brightest workers” who “need to see that Texas welcomes them and is determined to stay at the front of the pack when it comes to economic development.”

Texas House Speaker Joe Straus | SPEAKER STRAUS FORMS COMMITTEE TO LOOK AT ECONOMIC COMPETITIVENESS

Cook County, Illinois, home to Chicago and second city comedy, repealed its soda tax.

How long did the sugar tax last? It was adopted 4 months ago, and repealed before its December 2017 effective date

Who was for the soda tax? Commissioners who sought the $11 million in revenue to avoid an 115 across the board cut &  former New York Mayor Michael Bloomberg, a billionaire public health advocate, ran an expensive TV and radio ad campaign

Who was against the soda tax? American Beverage Association and local store owners teamed to spend millions of dollars to push for repeal (they spent less than Bloomberg and prevailed)

Chicago Tribune | Cook County Board repeals pop tax

Texas State Representative Ron Simmons is calling for a state infrastructure bank for water to ” issue bonds that could be used to either back up loans that are made by other banks”

Simmons linked the state infrastucture bank for water as a means to not dip into Texas’ Rainy Day Fund.

WFAA | Establishing state infrastructure bank could help Houston

California State Treasurer is calling on state funds, including state pensions, to divest from ” retailers that sell guns and ammunition around the country that are illegal in California”

What law does your state have that your elected officials would stoke a call for a political divestment? Certain women’s health care? Guns? Agriculture? Private Property Rights? Religious freedom? Public Education Standards?

Boston Globe | California treasurer urges state pension funds to drop gun sellers 

Michigan passed economic development legislation named ” the Good Jobs for Michigan bill”

The talking point:  “incentivize businesses to create large-scale employment that pays above-average wages”

The carrot for businesses:  A tax refund on qualified new employees

• If a business creates a minimum of 500 new jobs, pays wages at or above the regional average wage, it can get tax benefits up to 50% for the new employees for up to 5 years
• If a business creates a minimum of 250 new jobs, pays wages at 125% or more of the regional average wage, it can get tax benefits up to  100% for  the new employees for a period up to 10 years

The limits on the program:

• 15 projects per year
• rolling cap of $200 million for all projects
• unused funds may carry forward into future calendar years

Michigan SB242 (2017)

Arizona state attorneys involved in school finance litigation argue that the Judge has no authority to rule on funding adequacy.

Say what? it’s a basic separation of powers argument- funding is a question for the legislature not the judiciary

Arizona Daily Star | Can a judge tell the Legislature it’s not adequately funding schools?

Differing from other Sourthern States, the Florida Attorney General has not opined on the lgality of fantasy sports in Florida.

What does Florida HB 223 (2018) do for fantasy sports?

• outcomes reflect knowledge & skill AKA fantasy sports are a game of skill
• no specific statutory oversight, specific exceptions from regulation by the FL Department of Business and Professional Regulation

What does Florida SB 374 (2018) do for fantasy sports?

• outcomes reflect knowledge & skill AKA fantasy sports are a game of skill
• no college, high school or youth fantasy sports contests
• no specific statutory oversight, specific exceptions from regulation by the FL Department of Business and Professional Regulation

News Service of Florida | News 4 Jax | Lawmakers seek to end questions about fantasy sports

Legal Sports Report | Third Time’s The Charm? Florida Will Attempt To Pass Fantasy Sports Bill Again

Ohio has a .26% tax on business gross receipts above $1 million.

The Tax Foundation study lays out 5 reasons why the Ohio gross receipts tax is no bueno:

• Creates tax pyramiding
• Creates grossly inequitable effective tax rates across industries and businesses
• Even though the OH gross receipts tax was a tax cut, it is “difficult to attribute any positive economic outcomes”
• Results in extensive litigation
• A gross receipts tax is “inefficient and inequitable form of taxation long since superseded by more modern revenue tools”

Tax Foundation  | Ohio’s Commercial Activity Tax: A Reappraisal

• Pension problems will take a back seat. it’s not going to get worse.
• Balanced budgets are a government fallacy
• Deteriorating infrastructure will cost a lot to get it back up to par
• Cyberattacks will utliamtely cost lives when they hit infrastructure & health care

Governing | 5 Government Trends to Watch (the 5th trend is that in 30 years the these columnists will not be writing this column)

California legislators purport that pension costs exceed funding for schools, social services and parks.

Stanford Report | Pension Math: Public Pension Spending and Service Crowd Out in California, 2003-2030

Sacramento Bee | Pension costs ‘crowding out’ spending on parks, schools and social services, report says

The Ohio Supreme Court will no longer hear direct appeals of appeal disputed tax decisions.

Why the change in property tax appeals? “lighten its docket of a flood of market-driven property tax disputes and to preserve its role as arbiter of the state’s most significant legal questions.”

How did the Lege enact the change? Added the jurisdiction limitation to the state budget.

Does the jurisdictional limitation apply to individuals and businesses? yes, neither individuals nor businesses have the right to a direct appeal on tax rulings.

Governing | Taxpayers Lose Some Legal Rights in Ohio

• Texas:  $5 on each admission
• Illinois: $3 per customer admitted or use a sliding scale based on the amount of gross receipts subject to sales tax during the previous calendar year
• Georgia: greater of 1 percent of the previous calendar year’s gross revenues and $5,000
• Utah: 10% of admission fees, user fees, retail sales of in-state tangible personal property, and sales of food, food ingredients, beverages, and services
  • Utah’s tax also applies to escort services

Bloomberg | Salt Talk | Extras on Excise: Fashion Matters for Paying the Texas ‘Pole Tax’ 

3 Issues Ashby is requesting to be included as interim charges:

• Funding formulas for TDCJ, including adult probation and community supervision
• Abuse of common law marriage, including lawsuit abuse of common law marriage
• Improvements to TRS including – “should move away from a funding structure that considers active teacher payroll, in favor of one that considers the true cost of healthcare nationwide.”

Lufkin News | ASHBY: 3 issues Texas Legislature needs to consider

Kentucky is toying with the idea of closing its $33 Billion pension gap by suspending tax breaks for 3 years.

Tax breaks in kentucky account for roughly $13 billion, a 3 year suspension would be a revenue gain of $39 million.

Lexiington Herald Leader | On pension woes, first freeze the tax breaks

California Realtors want to change Proposition 13 from 1978- its the reason property is reassessed at sale only, and property taxes are capped at 1% of assessed value.

What are the proposals would change how property taxes are assessed and would apply in 3 different ways?

• Apply changes to all homeowners in California
• Apply changes to homeowners moving within their county of residence or to a county that allows intercounty assessed value transfers
• Apply to homeowners 55 or older moving anywhere in California

What are the economic incentives of reform?

• opens up th ehousing market
• frees up starter homes for first time home buyers

The potential impact to revenue:

• reduce revenues for cities, counties, special districts and schools anywhere from reduce revenue from a few hundred million dollars a year to several billion dollars a year
  Sacramento Bee | Own a home and looking to move? California Realtors want to get you a major tax break

   

The PROs for a Texas city to land Amazon’s second headquarters:

• large workforce
• universities
• essential infrastructure
• regulatory environment
• tax climate
• economic development incentives
• workforce training and education
• quality of life ( lakes, parks, recreational activities, museums, sports and entertainment venues, attractive and affordable housing, and the quality of the public school)

Texas cities have this factor against them:

• “…the recent tendency to enact or consider social legislation which is undesirable to many technology companies and workers.”

Rio Grande Guardian | Perryman: Attracting Amazon

In November 2016, Maine voters approved legalized recreational marijuana use.

The Maine Legislature is considering these changes to the voter approved 10% marijuana tax:

• doubling the marijuana tax rate to 20%
• giving a town with a recreational retail or cultivation business 5% of all state taxes collected from those facilities
• 6% of the remainder of the taxes would go to law enforcement
• 6% of the remainer would also fund public health, youth prevention and public awareness measures
• The remainder goes to Maine’s General Revenue Fund

AP via WCSH | 20% marijuana tax bill expected to be voted on

Portland Press Herald | Lawmakers decide how to divvy up 20% tax on Maine pot sales

Background: Jefferson County, Tennessee and other local governmental entities, including government officials, formed the Jefferson County Economic Development Oversight Committee

The Jefferson County Economic Development Oversight Committee​ recommended spending tens of millions of dollars in taxpayer money to begin development on an industrial megasite,

Open Records requests followed. A Tennessee appeals court ruled this week that open records laws applied because:

• It “performs a governmental function”
• “receives a substantial taxpayer funding”
• “is significantly involved and regulated by the Jefferson County Commission and Jefferson City and Dandridge city legislative bodies”

Why did people want the records in the first place? because word spread that the Jefferson County Economic Development Oversight Committee was tlaking about using eminent domain to acquire land for the industrial megasite

Citizen Tribune | Appeals Court: Jefferson group subject to open record laws

Texas Governor Abbott spelled out a 2019 bill draft during a Hurricane Harvey press conference. 

Background: Harvey Clean Up is costly. Texas Governor Abbott proposed accessing the millions in revenue held by TIRZ districts.

The Abbott legislative proposal, step by step: 

• modify the TIRZ statutes
• ensure tax increment revenue reserves held by TIRZ districts
• require reserve revenues in TIRZ districts to be accessible to cities to respond to disasters

The full Abbott quote: “Those hundreds of millions of dollars are siloed in TIRZ programs. Either the mayor could use those hundreds of millions of dollars to pay those expenses that cost a fraction of that, or the state legislature, during the next session, can and will modify the TIRZ statutes to ensure that the reserves, by TIRZ, can be used, by cities, to respond to disasters. So he has all the money that he needs, including the money that I provided to him, including the money that taxpayers have provided to him. He just needs to tap into it.”

The full City of Houston response:

“We cannot raid funds that the state has indicated cannot be raided – and which are largely for drainage projects to prevent future flooding anyway. Mayor Turner is asking the governor to do what other governors, such as Florida’s, are doing. It’s the Texas governor’s right to say no.”

KPRC | Gov. Abbott says Mayor Turner is using cleanup situation to hold state ‘hostage’

Ohio Legislature is trucking along with a fantasy sports regulation bill that will:

• regulate fantasy sports via the  Ohio Casino Control Commission
• supported by top executives of the Cincinnati Reds and Columbus Crew
• registration fee that maxes out at $30,000 for three years
• renewal fee of up to $30,000 for three years
• consumer protections

Crain’s Cleveland Business | Fantasy sports soon could have a new reality in Ohio

Ohio House Bill 153 (2017)

In 2016, Misouri legalized fantasy sports on the revenue estimate/ unicorn promise it would generate millions in revenue.

How much revenue will the state generate this year? $686,700 

Any hope on the horizon? yes, 4 new applicants to play in the fantasy sports area have emerged including Yahoo! Sports.

St. Louis Dispatch | Missouri on track to collect less than $1 million from fantasy sports tax

Opponents to Wisconsin’s Daily Fantasy Sports legislation make 2 arguments:

• Its an unconstitutional expansion of gambling
• Daily Fantasy Sports makes money by relying on lots of unskilled players participating while very few highly skilled players win all the prizes

WXPR | Group Raises Alarm Over Daily Fantasy Sports Bill

4 years ago Iowa reduced property taxes. Promises of sweeping changes. Reductions in commerical property taxes & the cities would be repaid by the state for any revenue loses.

The reality? The cities are losing property tax revenue, aren’t being fully reimbursed and businesses aren’t seeing the 1/2 tax cut promised. Surprise. Surprise. Surprise.

Des Moines Register | Iowa’s largest property tax cut in history fails to deliver, Register investigation finds

Texas Public Policy Foundation is calling for swift implementation of these economic policies which failed in 2017:

• Eliminate the business franchise tax, not included in the call [of the special session].
• Reform property taxes, included in the call [of the special session] but not passed.
  • ​All hail: SB 1 or HB 4
• Restrain budget growth to cut taxes, not included in the call.
•  Enact a stringent spending limit, included in the call but not passed.
  • ​All hail :  SB 9 or HB 208 
• Increase state budget transparency, not included in the call.
  • ​”Many government programs continue to get funding years after they are no longer needed.”  There’s no synopsis that does this sentence justice.
• Reduce government regulations, not included in the call.
  • ​vigilence…must remain low regulation.

TPPF | SIX MISSED OPPORTUNITIES IN SPECIAL SESSION THAT COULD HAVE AIDED ECONOMIC PROSPERITY

A drafting error in the revised marijuana tax in Colorado created the need for a special session to begin October 2nd.

What did the drafting error do? It prevented all taxing jurisdictions, to which the marijuana tax applies, from collecting the tax

AP via U.S. News & World Report | Colorado Governor Calls Legislature Back to Repair Pot Tax 

Danish pension fund has agreed to buy a 27.7% stake in Copenhagen Airports, moving ownership from an Australian company to a Danish pension.

Reuters | Danish pension fund to buy stake in Copenhagen Airports in $1.6 billion deal

France, Spain and Germany are tackling- how do can we tax tech?

What’s at issue: How can you tax where tech companies gerneate revenue. Not just where tech companies book their profit

What’s the angle? An “equalization tax” on tech revenue earned from digital business activity 

Proposed rates: 2 to 5% of revenue generated

Tech Crunch | France, Germany, Spain, Italy call for turnover tax for tech giants

CALPERs is in talks that could outsource its private equity division & serve as a bellweather for other state pensions.

How could this affect the pension fund?   Private equity has been CalPERS’ best-performing and main asset class in the past two decades

Reuters via CNBC | Largest US pension fund CalPERS in talks with BlackRock to outsource buyout business, source says

• Bring Your Infant to Work Day, All Day, Every Day. (AZ Dept. of Health Services, not technically a local government, but a government)
• discounts at local fitness centers (Memphis)
• free public transportation (Memphis)
• small cash performance awards (Memphis)
• departmental appreciation nights at local venues (Memphis)
• Student Loan Reduction Program beginning at $50/month (Memphis)
•  a gym, a sleep pod for 15-minute naps, and a juice bar–free anytime  (Atlanta)
• Educational events and same-day medical appointments (Atlanta)

Governing | Can New Perks Make Up for Smaller Pensions?

No. Nyett. Nej. Not gonna happen. 

To what question was the TX Attorney General repsonding?Chambers County asked to use sales & use tax revenue to fund the position of county fire marshal and safety coordinator because the Tax Code says it can be used for health and safety.

Why can’t sales and use tax revenue be used like this? Fire Marshall and Safety Coordinator sounds like health and safety? Chapter 324 of the Tax Code ties health and safety to disease prevention.

What would Chambers County need to do legislatively? Change Section 324.081 of the Tax Code to include fire marshalls and safety coordinators.

Texas Attorney General Opinion KP-0162

The opposition to ESAs in New Hampshire point to these issues with the legislation:

• New Hampshire’s proposed Educational Savings Account program would not be housed in the state educaiton agency and would be operated by a private scholarship organization
• Are there adequate oversight mechanisms?
• The fiduciary responsibility for the tax revenues & whether the Legislature is meeting its fiduciary duty

SB 193 New Hampshire (2017)

Concord Monitor | Accountability concerns arise over education savings account bill