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 98-895

Rep. Leyba

 

Date:

Bill Status:

Fiscal Analyst:

April 18, 1998

House SVMA

Harry Zeid (866-4753)

 

TITLE:            SUBMITTING TO THE REGISTERED ELECTORS OF THE STATE OF COLORADO AN AMENDMENT TO ARTICLE XVIII OF THE CONSTITUTION OF THE STATE OF COLORADO, CONCERNING THE AUTHORITY OF THE GENERAL ASSEMBLY TO ESTABLISH A TEMPORARY STATE-SUPERVISED LOTTERY GAME WITH NET PROCEEDS ALLOCATED TO THE CONSTRUCTION OF A SPORTS FACILITY DESIGNED FOR USE PRIMARILY AS A NATIONAL LEAGUE FOOTBALL STADIUM IF THE REGISTERED ELECTORS OF THE METROPOLITAN FOOTBALL STADIUM DISTRICT APPROVE A TAX INCREASE TO FUND CONSTRUCTION OF SUCH SPORTS FACILITY. 



Summary of Legislation


STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

State Revenues

General Fund

Cash Funds



 


Spillover G.F. Revenues May be Reduced

Current C.F. Lottery Dist. May be Reduced

State Expenditures

General Fund

Cash Funds Exempt



 



 Increased Lottery Admin. Expenses

FTE Position Change

None

None

Local Government Impact — Certain local governments receive net lottery proceeds from the current state lottery. These revenues may be affected by the addition of a new state-supervised lottery game.

             *See the State Revenues and the State Expenditures sections of the fiscal note for an explanation of the impact of a new lottery game on existing lottery revenues, as well as the impact on existing revenues and expenditures.


            This House Concurrent Resolution would submit a question to the registered electors of the State of Colorado at the next general election in November 1998 to amend Article XVIII of the State Constitution. The amendment would allow the General Assembly to establish a one-time, temporary, state-supervised lottery game in which the net proceeds shall be allocated to the construction of a sports facility that is designed for use primarily as a National Football League Stadium. This would occur only if the registered electors of the Metropolitan Football Stadium District approve a tax increase to fund construction of the sports facility. The lottery game could not extend beyond the payment period for bonds issued for construction of the sports facility, or December 31, 2011, whichever is earlier.


            If approved by the voters and established by the General Assembly, the resolution would affect revenues and expenditures of the State Lottery Division. While net lottery proceeds may be made available for allocation to the construction of a sports facility, the recipients of proceeds from the current state lottery may be negatively affected by the competition that would occur by the addition of a new lottery game. Since HCR 98-1011 would only take effect following the resolution’s approval by the registered electors and establishment of the new lottery game by the General Assembly in the future, the resolution is assessed as having conditional fiscal impact.



State Revenues


            The resolution authorizes the General Assembly to establish a one-time, temporary, state-supervised lottery game for the purpose of assisting in financing the construction of a new National Football League stadium, upon approval by the voters. The resolution is permissive in allowing the General Assembly to establish the lottery game. The lottery game that may be established could be a scratch game, a lotto game, or a type of game that is not presently offered by the Colorado Lottery. Net lottery proceeds and expenditures that may be required to operate the lottery game have not been estimated.


            Under current law, net lottery proceeds are distributed by a constitutionally authorized formula to the Conservation Trust Fund, state parks, and Great Outdoors Colorado. Spillover proceeds above these requirements revert to the state General Fund. Current state lottery net proceeds may be affected by the competition that would occur as a result of adding a new state-supervised lottery game. The actual impact has not been estimated.



State Expenditures


            The State Lottery Division would have expenses to operate a new lottery game. The cost of operating the game would be dependent on the nature of the game operated and the revenues that would be generated by the game.



Election Expenditure Impacts (For 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.



Local Government Impact


            Certain local governments receive net lottery proceeds from the current state lottery. These revenues may be affected by the addition of a new state-supervised lottery game.



Spending Authority


            The fiscal note would imply that no appropriations or spending authority are required in FY 1998-99 to implement the provisions of the bill.



Departments Contacted


            Revenue



Omissions and Technical or Mechanical Defects


            References in the resolution to a “National League Football Stadium” should read “National Football League Stadium”.