LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session April 24, 1995 TO: Honorable Bill Sims, Chair IN RE: Committee Substitute Committee on Natural Resources for Senate Senate Bill No. 372 Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on Senate Bill No. 372 (Relating to the continuation and functions of the Department of Agriculture and certain associated entities, including the Texas Agricultural Finance Authority, The Agriculture Resources Protection Authority, the State Seed and Plant Board, and the Produce Recovery Fund Board, and generally to matters regarding agriculture in this state; providing penalties.) 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 continue the Texas Department of Agriculture and make several changes to the Agriculture Code. Some of the significant changes include restructuring and refocusing the Agriculture Resources Protection Authority, transferring the authority to oversee all agriculture finance programs to the Texas Agricultural Finance Authority, requiring the Department to recover 100 percent of the costs of administering most regulatory programs, transferring administrative hearings to the State Office of Administrative Hearings, and authorizing the privatization of weighing and measuring device inspections. The amount set forth for the administration of this agency in the General Appropriation Bill, as introduced, (FY 96 = $22,552,094; FY 97 = $22,552,094) would be contingent upon passage of S.B. 372, or similar legislation. The appropriations would be financed from the General Revenue Fund, federal funds, Texas Agricultural Fund No. 683, Aquaculture Fund No. 678, and other funds, and would provide for approximately 524 employees. The bill would increase the number of members on the Agriculture Resources Protection Authority by six members with an estimated cost of $4,608 per year. The bill would require the Department to recover 100 percent of most regulatory program costs. The provision removes all regulatory program fee limits set in statute and requires the Department to collect fees sufficient to recover costs. This provision applies only to regulatory programs. Programs where increased fees would be contrary to program goals may be exempted through an appropriations rider. The effective date of this provision is September 1, 1996 and has an estimated net revenue gain to the state of $4,390,510 per year beginning in Fiscal Year 1997. The bill would also eliminate the requirement for the Department to register pesticide products that are not registered by the U.S. Environmental Protection Agency. Currently, the Department registers approximately 100 pesticide products that are not registered by the EPA. Removing this registration requirement for these products would result in an annual revenue loss of approximately $10,000. The bill would also transfer administrative hearings from the Department to State Office of Administrative Hearings (SOAH). This provision is not expected to result in any overall fiscal impact to the state. TDA is anticipated to enter into interagency contracts with SOAH to conduct administrative procedure hearings. The amounts of the interagency contracts that accomplish the transfer have not been determined. The reduction in hearings personnel at TDA would be offset by the increase in personnel at SOAH. 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 Probable Revenue Change in Year of General Gain/(Loss) to Number of State Revenue Fund 001 General Revenue Employees from Fund 001 FY 1995 1996 $4,608 ($10,000) .0 1997 4,608 4,390,510 .0 1998 4,608 4,390,510 .0 1999 4,608 4,390,510 .0 2000 4,608 4,390,510 .0 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: Sunset Advisory Commission, Comptroller of Public Accounts, Department of Agriculture LBB Staff: JK, JH, DF