Below is the HillCo client report from the May 28 House Ways & Means Committee hearing.
The committee met to take up the following interim charge:
Review the various state event trust fund accounts to ensure that the accounts are operated in a manner that is transparent and accountable.
Robert Wood, Director of Economic Development & Analysis, Office of the Comptroller
- Of the four trust funds in the state, only two are significantly used
- Discussion on the requirements to participate in the trust funds
- All changes from SB 1678 (83R) have been implemented into department practices or will be in the near future
- There have been about half as many applications since the passage of SB 1678
- Chairman Harvey Hilderbran asked about background for why SB 1678 was needed and what concerns were
- Concerns were in the rapid growth of the number of events and the amount of money being given out; in 2012 there were over 100 events using the funds and that was the most over the history of the fund; SB 1678 mostly changed who can qualify and how they qualify
- Rep. John Otto asked what items the state will reimburse
- Police, fire, barricades, traffic control, signage, water for officials, general health and safety issues
- Otto asked if a budget is submitted for the event
- Not a budget, they must justify the amount they are requesting; what it pays for and showing that it was a cost of hosting the event
- Hilderbran asked if there is a reason why the special events fund is used much less than the other funds
- It doesn’t provide as much funding for communities as the other trust funds; the special events trust fund only works from a portion of the sales and use tax, the other funds use multiple taxes and 100% of the sales and use tax
- Otto asked how incremental spending numbers are determined
- Expenses are only counted for someone who comes to the state from outside the state and spends money; attendance is calculated, an estimate is made for the number of out of state people, that percentage is multiplied against an assumption of spending and the taxes are run from those numbers
- Rep. Celia Israel asked for some type of cost benefit analysis
- The study of incremental spending is done to determine the benefit for cities; SB 1678 was passed with the intent of getting some of those studies implemented
- Hilderbran asked what the main criticisms have been for the funds
- Some concerns were that cities are using the funds for small events
- Hilderbran asked about the motor events fund; can money be used for prize money
- The fund can pay expenses that the local community has agreed to take on which can include sanction fees, prize money
- Otto asked if the new NCAA playoff system is mentioned in statute
- Yes, that was taken care of in a separate bill; the NCAA championship game
Theron Bowman, Deputy City Manager, City of Arlington
- These funds play a significant role in drawing many types of events to the state
- The funds have brought significant, nationally recognized events that would not have come to Texas without the funds making the state competitive
- During all these events public safety is the highest priority and most funds go toward safety expenses
- Public safety for an event like a Super Bowl require many specialized units such as SWAT teams, bomb squads, EMT teams, etc. which are many times provided through regional governments; the cost for these services was over $1 million
- Traffic management, code compliance, pre and post event cleanup costs from the Super Bowl cost over $700,000
- The Comptroller determined that the event brought over $26 million to the state economy because of the Super Bowl
- The city supports measures to enhance transparency and accountability in the use of the trust funds