LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session May 5, 1995 TO: Honorable Tom Craddick, Chair IN RE: Committee Substitute Committee on Ways & Means for House Bill House of Representatives No. 1892 Austin, Texas By: Holzheauser FROM: John Keel, Director In response to your request for a Fiscal Note on House Bill No. 1892 (relating to an exemption from the oil and gas production taxes for hydrocarbons produced from wells that use new recovery techniques; providing a civil penalty) this office has determined the following: The bill provides for severance tax exemptions for the production of hydrocarbons (viz., gas, oil condensate, or other liquid hydrocarbon produced from a well) from oil or gas wells that use a new recovery technique. The term "new recovery technique" is defined as a hydrocarbon recovery technique determined by the Railroad Commission that is a previously unproven recovery, completion, or drilling technique that has a reasonable possibility of increasing the ultimate recovery of hydrocarbons. At this time, it is not possible to specify what will be the future "previously unproven recovery technique having a reasonable possibility of increasing the recovery of hydrocarbons," therefore the fiscal implications cannot be determined. The fiscal implication to the State or units of local government cannot be determined. Source: Comptroller of Public Accounts LBB Staff: JK, CT, DF