LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session May 20, 1997 TO: Honorable James E. "Pete" Laney IN RE: House Bill No. 1144, As Passed 2nd House Speaker of the House Turner Bob House of Representatives Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB1144 ( Relating to the consolidation of herbicide and pesticide laws under the jurisdiction of the Department of Agriculture.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB1144-As Passed 2nd House Implementing the provisions of the bill would result in a net positive impact of $513,249 to General Revenue Related Funds through the biennium ending August 31, 1999. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. Fiscal Analysis The bill would change requirements for pesticide dealer licenses. Licenses would be renewed every two years instead of annually. The bill would require previously exempt pesticide applicators who work for noncommercial governmental agencies to pay a licensing fee. In addition, the Agriculture Resources Protection Authority (ARPA), which coordinates policies and programs for pesticide regulation and management among state agencies, would meet annually instead of quarterly. Several new exemptions would be added to the Texas Structural Pest Control Act (Article 135b-6, V.T.C.S.). Methodolgy There would be a one time cost to the Department of Agriculture of $3,000 to reprogram the automated licensing system. There would be a gain of $80,000 to General Revenue in the first year of the new licensing program. In the first year, half of the licensees would pay the regular annual fee and the other half would pay double that amount for a two year license. Due to license staggering, there would be no revenue gains in the following years. A reduction in the mailing and processing of license renewal notices would produce savings of $1,768 per year. The bill's provisions requiring previously exempt noncommercial governmental agency employees to pay licensing fees would result in a revenue gain to General Revenue of $200,000 per year, based on an estimate of 2,000 applicable licensees. The Department of Agriculture also estimates that the cost to General Revenue would be $6,811 in fiscal year 1998 and $5,576 in fiscal years 1999 and beyond. The Department of Health estimates that the cost to implement a new fee program would require 4 new FTEs and cost $108,015 in fiscal year 1998 and $149,046 in fiscal year 1999 and beyond. These costs would be offset by the license fee; therefore, the agency estimates a gain to General Revenue of the same amounts. The bill's provisions to change ARPA meetings from quarterly to annually would result in a savings in travel costs of $4,200 per year. The Structural Pest Control Board estimates a reduction of 1,175 certified noncommercial applicators ($66 fee) and over 700 examinations ($30 fee), resulting in a loss to general revenue of over $99,000 annually. This estimate assumes that those noncommercial applicators would now be licensed by TDA ($100 fee) without any re-examination. The probable fiscal implications of implementing the provisions of the bill during each of the first five years following passage is estimated as follows: Five Year Impact: Fiscal Year Probable Probable Probable Revenue Probable Revenue Change in Number Savings/(Cost) Savings/(Cost) Gain/(Loss) from Gain/(Loss) from of State from General from General General Revenue General Revenue Employees from Revenue Fund Revenue Fund Fund Fund FY 1997 0001 0001 0001 0001 1998 ($117,826) $5,968 $505,515 ($99,150) 4.0 1998 (154,622) 5,968 466,546 (99,150) 4.0 2000 (154,622) 5,968 466,546 (99,150) 4.0 2001 (154,622) 5,968 466,546 (99,150) 4.0 2002 (154,622) 5,968 466,546 (99,150) 4.0 Net Impact on General Revenue Related Funds: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $294,507 1999 218,742 2000 218,742 2001 218,742 2002 218,742 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. The Department of Health estimates that 85 percent of its noncommercial pesticide applicators are governmental entities. Therefore, the fiscal impacts to local governments would be $49,375 in fiscal year 1998 and $63,750 each year thereafter. Source: Agencies: 472 Structural Pest Control Board 501 Department of Health 551 Department of Agriculture LBB Staff: JK ,BB ,JH ,DM