LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session April 12, 1995 TO: Honorable Ken Armbrister, Chair IN RE: Committee Substitute Committee on State Affairs for Senate Senate Bill Austin, Texas No. 14 FROM: John Keel, Director In response to your request for a Fiscal Note on Senate Bill No. 14 (Relating to protecting private real property rights from certain actions of this state or a political subdivision of this state.) this office has determined the following: The bill creates a new cause of action: a statutory taking that goes beyond current law regarding the unconstitutional taking of private property rights. It also waives sovereign immunity as provided in the bill and permits the State and other governmental entities to be sued for compensation for actions taken by the government entity that are the producing cause of a reduction in the market value of the affected private real property of 20 percent or more. The bill would allow the owners of private property who prevails in a suit to recover loss of market value, reasonable and necessary attorneys fees, court costs and all prejudgment interest. The bill also imposes a duty on the Office of The Attorney General to prepare guidelines to assist governmental entities in identifying and evaluating those governmental actions that constitute a taking. These guidelines must be completed no later than January 1, 1996, and must be published in the Texas Register and revised annually. Like the State, local governments would be required to go through a formalized procedure for performing "taking" assessments and would be required to pay monetary compensation for reductions in the market value of private real property interest. In addition, the bill would require a Chief Appraiser to consider the effect of governmental actions on the market value of private real property when appraising for ad valorem tax purposes. The fiscal implication to the State or units of local government cannot be determined due to insufficient information regarding the number of successful actions, amount of market value loss or parcels of property which may be affected. The Texas Department of Transportation has estimated that the cost specific to the Department would be as follows: 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 State Highway Number of State Fund 006 Employees from FY 1995 1996 $13,124,028 28.0 1997 13,124,028 28.0 1998 13,124,028 28.0 1999 13,124,028 28.0 2000 13,124,028 28.0 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. Source: Office of the Attorney General, Natural Resources Conservation Commission, Department of Transportation, Parks and Wildlife Department LBB Staff: JK, BR, DF