LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session May 6, 1995 TO: Honorable Curtis Seidlits, Chair IN RE: Committee Substitute Committee on State Affairs forHouse Bill House of Representatives No. 1777 Austin, Texas By: Black FROM: John Keel, Director In response to your request for a Fiscal Note on House Bill No. 1777 (Relating to the regulation of small telecommunications utilities and telephone cooperative corporations.) this office has determined the following: The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. The bill would allow local exchange companies that are cooperatives to offer extended local services or new services on an optional basis or make minor changes to rates, subject to certain notice conditions and revenue limitations. The bill would also require the Public Utility Commission to review its rules, policies and reporting requirements as they relate to small local exchange companies and cooperatives to eliminate or revise those placing unnecessary burden or expense on such companies. In addition, the bill would allow telephone cooperatives to vote to partially deregulate. Partially deregulated cooperatives could offer extended local calling services or new services on an optional basis or make rate changes, subject to certain notice provisions. Implementation of the bill's provisions would result in additional complex rule adoption proceedings by the Public Utility Commission, review and revision of rules and reporting requirements, and an increase in tariff filings. The probable fiscal implication of implementing the provisions of the bill during each of the first five years following passage is estimated as follows: Fiscal Probable Cost Out Change in Year of General Number of State Revenue Fund 001 Employees from FY 1995 1996 $77,651 1.4 1997 16,016 .3 1998 16,016 .3 1999 16,016 .3 2000 16,016 .3 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. No fiscal implication to units of local government is anticipated. Source: Public Utility Commission, Office of the Public Utility Counsel LBB Staff: JK, RM, DF