TO:	Honorable Charles Schwertner, Chair, Senate Committee on Business & Commerce
FROM:	Jerry McGinty, Director, Legislative Budget Board
IN RE:	SB1001 by Schwertner (relating to the regulation of electric vehicle supply equipment; requiring an occupational registration; authorizing fees; authorizing an administrative penalty.), Committee Report 1st House, Substituted

General Revenue-Related Funds, Five- Year Impact:

All Funds, Five-Year Impact:

Fiscal Analysis

The bill would amend the Occupations Code relating to the regulation of electric vehicle charging equipment by the Texas Department of Licensing and Regulation (TDLR), authorizing a fee, and  providing a civil penalty. The bill would require TDLR to administer and enforce the provisions of the new "Electric Vehicle Supply Equipment" chapter as established by the bill.

The bill would authorize TDLR to periodically inspect electric vehicle supply equipment in order to verify compliance with the chapter, and to contract to perform the department's duties related to electric vehicle supply equipment, including inspections. The bill would require TDLR to establish fees by rule in an amount reasonable and necessary to cover the costs of administering the chapter.

The bill outlines the duties of electric vehicle supply providers and requires registration of each charging unit of electric vehicle supply equipment operated by the provider prior to the equipment being made available for use for commercial transactions. Electric vehicle supply equipment would be exempt from the requirements of the chapter if the equipment is installed in or adjacent to a private residence for noncommercial use, or if it is provided at no charge for the exclusive use of an individual, or a group of individuals, including employees, tenants, visitors, or residents of a multi-unit housing, business or office development.

Electric vehicle supply equipment installed before December 31, 2023, would be exempt from the requirements of Section 2311.0303 until the 10th anniversary of the date of rules adoption. Electric vehicle charging equipment installed before the effective date of the bill would have until March 1, 2028, to be in full compliance with the chapter. Equipment installed on or after the bill's effective date but before March 1, 2025, would have to be in compliance by March 1, 2025. Equipment installed on or after March 1, 2025, would need to be in compliance and be registered prior to operation.

The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2023.

Methodology

Based on analysis and forecasting by TDLR, this estimate assumes population growth for electronic vehicles and charging devices through fiscal year 2028. Projections for the five-year period anticipate 234,966 electronic vehicles registered in fiscal year 2024, 308,655 in fiscal year 2025, 405,453 in fiscal year 2026, 532,610 in fiscal year 2027, and 699,644 in fiscal year 2028. Projections for the five-year period anticipate approximately 9,600 new devices registered in fiscal year 2025, 4,800 renewals and 1,150 new registrations in fiscal year 2026, 4,800 renewals and 1,175 new registrations in fiscal year 2027, and 5,950 renewals and 1,200 new registrations in fiscal year 2028.  These numbers take into account expected growth as a result of federal infrastructure legislation investments in electric vehicle infrastructure.

This estimate assumes TDLR would need to register half the 4,800 metering devices in fiscal year 2024 at a full fee of $54 and half with a $27 registration that would expire in one year, so those devices would need to renew in the fiscal year 2025 for a full two-year registration. The bill also requires a $1 registration sticker for each device to demonstrate its registration and provide information to consumers. Under the bill's provisions, renewals would be $50 every two years. 

TDLR anticipates and this estimate assumes that the agency would require 5.0 additional full-time-equivalent (FTE) positions to implement the provisions of the bill beginning in fiscal year 2025. A License and Permit Specialist ($43,139 per year with estimated benefits of $13,731) would be responsible for the registration of the metering device and their renewal. A Customer Service Representative ($45,510 per year with estimated benefits of $14,485) would be needed to manage any contacts about charging providers or metering devices. A Legal Assistant ($55,096 per year with estimated benefits of $17,537) to intake any complaints about charging providers or metering devices and review those complaints for jurisdiction and whether a violation has occurred. An Administrative Assistant ($40,913 per year with estimated benefits of $13,022) to perform the administrative part of intaking the complaints as it is anticipated there would be a high volume of complaints, many of which will be non-jurisdictional. This position would begin as a half-time position for fiscal years 2025 through 2027 but would increase to a full time position in fiscal year 2028 to address the projected increase in complaints over the five-year period. And lastly, a Program Specialist ($67,089 per year with estimated benefits of $21,354) to serve as the agency's subject matter expert on the metering devices and electric vehicles. The program specialist would assist in enforcement investigations and any complaint inspections, conduct outreach with the industry and public, and oversee issues with the inspection and calibration of devices. These FTEs will costs would total $251,748 per fiscal year in salaries, $2,800 per fiscal year in travel expenses, and one time startup costs in fiscal year 2025 of $30,000.

The anticipated revenue estimated by the Comptroller of Public Accounts would be $0 in fiscal year 2024, $390,000 for registration and sticker fees in the fiscal year 2025, $298,000 in the fiscal year 2026, $300,000 in fiscal year 2027, and $359,000 in fiscal year 2028. This analysis assumes that any increased cost to TDLR above Comptroller of Public Accounts revenue estimates from the fee authorized in the bill would be offset by an increase in fee-generated revenue because TDLR is statutorily required to generate sufficient revenue to cover its costs of operation.

Based on analysis from the State Office of Administration Hearings, duties and responsibilities associated with implementing the bill could be accomplished by utilizing existing resources. 

Technology

This estimate assumes that TDLR would establish this program in its licensing system with existing resources.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.