BILL ANALYSIS AND FISCAL IMPACT REPORT	Page 1 of  1

DATE:  March 13, 2001	Submitted by: TAXATION AND REVENUE DEPT.
	T. GLENN ELLINGTON, SECRETARY   
BILL NUMBER:  SB-192 as amended by the Senate Finance Committee (3/12/2001)

SPONSOR:  Senator Altamirano

BILL SHORT TITLE:  Gross Receipts Distribution to Aviation Fund 

CONFLICTS, DUPLICATES, COMPANIONS:  

DESCRIPTION:  This bill authorizes an additional distribution of 46 thousandths of one percent (0.046%) of net general fund gross receipts tax revenue to the State Aviation Fund for use by the Air Service Assistance Program.  The tax distribution provisions are effective from July 1, 2002 through June 30, 2007.  The bill includes an appropriation from the General Fund to the State Highway and Transportation Department for use in the Air Service Assistance Program during fiscal years 2001 and 2002.

The Senate Finance Committee amendment decreased the appropriation to the Air Service Assistance Program, appropriating the money from the General Fund rather than the State Road Fund.

EFFECTIVE DATE:  Effective immediately under an Emergency Clause (Section 3).

FISCAL IMPACT (Thousands of dollars):	Note: Parenthesis ( ) indicate a revenue loss:

		Recurring or		
	Estimated Impact on Revenues	Nonrecurring	Funds 	
	FY 2001-2002	FY 2002-2003	     Impact     t     	Affected  	
	(50)	(620)	Recurring	General Fund	
	   50	620	Recurring	State Aviation Fund	

The fiscal impact for fiscal year 2001-2002 results from the July 1, 2002 tax distribution provision which would affect the July distribution of June 2002 tax collections.

APPROPRIATIONS (Thousands of dollars) :
		Recurring or	
FROM	          TO          .	AMOUNT	FISCAL YEAR	Nonrecurring	
General Fund	SH&TD (Air Service Assistance Program)	400	2000-2001	Nonrecurring	

The unencumbered balance remaining at the end of fiscal year 2002 would revert to the State General Fund.

OTHER IMPACTS AND ISSUES:
•	Earmarking is generally an inefficient and inaccurate method of allocating state funds to a particular purpose.  Earmarking either over-allocates or under-allocates funding, and the relationship changes over time.  Neither the executive nor the legislature exert much oversight of earmarked funding.  It is generally in the best interest of the state’s taxpayers to provide general funding for programs such as aviation and air services. General fund expenditures are subject to extensive annual review, insuring that the need for program services is regularly weighed against all other state needs.