Colorado Legislative Council Staff

STATE

CONDITIONAL FISCAL NOTE

General Fund Revenue Impact

Cash Fund Exempt Revenue and Expenditure Impact


Drafting Number:

Prime Sponsor(s):

LLS 98-169

Rep. Dyer

Date:

Bill Status:

Fiscal Analyst:

April 16, 1998

House Business Affairs

Steve Tammeus (866-2756)

 

TITLE:            SUBMITTING TO THE REGISTERED ELECTORS OF THE STATE OF COLORADO AN AMENDMENT TO SECTION 3 OF ARTICLE XXVII OF THE CONSTITUTION OF THE STATE OF COLORADO, CONCERNING THE USE OF A SPECIFIED AMOUNT OF NET LOTTERY PROCEEDS CURRENTLY ALLOCATED TO THE STATE GENERAL FUND FOR COLORADO TOURISM PLANNING, PROMOTION, AND DEVELOPMENT.


Summary of Legislation


STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

FY 2000/01

State Revenues

General Fund

Colorado Tourism Promotion Fund


 


($4,940,000)

$4,940,000


($4,350,000)

$4,350,000

State Expenditures

General Fund

Colorado Tourism Promotion Fund


 



$4,940,000



$4,350,000

FTE Position Change

None

3.0 FTE

3.0 FTE

Local Government Impact — None


            This concurrent resolution would submit a constitutional amendment to the voters at the 1998 General Election to amend the provisions that require remaining net lottery proceeds to be transferred to the General Fund after distributions have been made to the Conservation Trust Fund, the Division of Parks and Outdoor Recreation, and the Great Outdoors Colorado (GOCO) Trust Fund.


            The constitutional amendment would, effective FY 1999-2000, allocate the first $9.0 million of net lottery proceeds to the Colorado Tourism Fund, or a successor fund, rather than the General Fund. Any amount of net proceeds over $9.0 million would be allocated to the General Fund. The resolution would require the moneys credited to the Colorado Tourism Fund to be used to promote Colorado tourism.


            The provisions of the resolution would affect state General Fund revenue, and cash fund exempt revenue and expenditures if approved by a vote of the people. Therefore, the resolution is assessed as having a conditional state fiscal impact.


State Revenues


            The provisions of this resolution would not increase or decrease state revenues, but effective FY 1999-2000 would divert up to $9.0 million of net lottery proceeds from the General Fund to the Colorado Tourism Promotion Fund under the Department of Local Affairs. Legislative Council Staff estimates the following amounts of net lottery proceeds would be available for distribution to the Colorado Tourism Promotion Fund: $4,940,000 for FY 1999-2000 and $4,350,000 for FY 2000-01.


State Expenditures


            This resolution would require the Department of Local Affairs to administer the moneys credited to the Colorado Tourism Fund for the promotion of Colorado tourism. The department’s expenditures to support the provisions of this resolution are based upon the following assumptions:

               that the department will contract the services of telemarketing and advertising businesses to provide tourism promotions and marketing; and

               that the department will require additional staff to develop and administer the contracts, develop and evaluate RFP’s, support the Colorado Tourism Board, participate in trade and promotional events, conduct market research, and develop domestic and international marketing programs.


            Table 1 provides a summary of the department’s expenditures for FY 1999-2000 and FY 2000-01.

Table 1 - Department of Local Affairs

Colorado Tourism Promotion Fund Expenditures (CFE)

 

FY 1998-99

FY 1999-00

FY 2000-01

Personal Services

Prog Admin II (109/1)

Admin Prog Spec II (91/1)

Admin Asst III (76/1)

Subtotal

PERA/Medicare

Total

 


1.0 FTE - $55,680

1.0 FTE - 35,892

1.0 FTE - 24,972

$116,544

15,092

$131,636


1.0 FTE - $55,680

1.0 FTE - 35,892

1.0 FTE - 24,972

$116,544

15,092

$131,636

Operating/Travel Expenses

 

$122,370

$122,370

Board Expenses

 

$6,000

6,000

Furniture/Computer

 

$12,900

0

Tourism Promotions

 

4,667,094

4,089,994

Total Expenses

0

3.0 FTE - $4,940,000

3.0 FTE - $4,350,000



Expenditures Not Included


            Pursuant to the Joint Budget Committee’s budget policies, the following expenditures have not been included in this fiscal note:

 

               health and life insurance costs of $6,636;

               short-term disability costs of $245;

               inflationary cost factors;

               leased space costs of $8,930 (470 rsf @ $19/rsf); and

               indirect costs of $17,482 (15% of total salary).



Election Expenditure Impacts (informational purposes only)


            A General Fund line-item in the 1998-99 Long Appropriations Bill will fund the costs of publicizing any initiative or referendum proposal in newspapers and for printing and distribution of the Blue Book to all electors. The General Assembly spent $291,267 GF for one state-wide ballot proposal on the November, 1995 ballot and $1,042,014 GF for the 12 proposals that appeared on the November, 1996 ballot.


            The 1996 General Election fixed costs for mailing the Blue Book to 1.35 million registered voters was $174,036 for postage and $3,800 for obtaining mailing addresses. These costs will be the same regardless of the number of issues on the ballot. Variable costs included: Spanish translation of $11,215; newspaper publication of $644,828; printing costs of $206,806; and other costs of $1,328. Total costs were $1,042,014 GF. Fixed costs totaled $177,837 and variable costs were $72,015 per ballot issue.


            Based on the costs incurred for the 1996 Blue Book, one ballot issue cost $249,852 to print and mail to the public. The $72,015 of incremental cost would be added for each issue to the basic mailing costs of $177,837.



Spending Authority


            This fiscal note would imply that no new state appropriations or spending authority would be required for FY 1998-99.



Departments Contacted


            Local Affairs              Revenue                      Legislative Council Staff