LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
April 24, 1997
TO: Honorable John Whitmire, Chair IN RE: House Bill No. 1301, As Engrossed
Committee on Criminal Justice By: Allen
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on HB1301 ( Relating
to the oversight of the private sector prison industries program.)
this office has detemined the following:
Biennial Net Impact to General Revenue Funds by HB1301-As Engrossed
Implementing the provisions of the bill would result in a net
positive impact of $1,094,000 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 partially implement Texas Performance Review
(TPR) recommendation PSC5 in Gaining Ground: A Report from
the Texas Performance Review (1994).
The bill would amend
certain portions of the Government Code relating to the private
sector prison industries program. The bill would create the
Private Sector Prison Industries Oversight Authority (authority)
to approve, certify, and oversee the operations of private prison
industries programs in the Texas Department of Criminal Justice
(TDCJ), the Texas Youth Commission, and in county correctional
facilities.
The authority would consist of nine members
appointed by the Governor. Authority members would not be entitled
to compensation but would be entitled to reimbursement for travel
expenses as provided in the General Appropriations Act. The
executive director of TDCJ would be required to provide the
authority with the necessary clerical and technical support
to perform the duties imposed by the bill.
The bill would
require a private sector prison industries program to make an
annual payment to the authority. The authority would be required
to remit the fees collected to the Comptroller's Office for
deposit to the credit of a new, dedicated Private Sector Prison
Industries Oversight Account in the General Revenue Fund. The
Legislature could appropriate funds from this account only for
the purpose of paying the costs incurred by the authority and
TDCJ to implement the terms of the bill. At the end of each
fiscal year, the Comptroller would be required to transfer any
excess funds in the account to the credit of the dedicated Compensation
to Victims of Crime Account in the General Revenue Fund.
This
bill would take effect on September 1, 1997. TDCJ's power,
duties, and obligations to oversee the program would be transferred
to the authority on January 1, 1998, as would any funds appropriated
to TDCJ for oversight of the program.
Methodolgy
The estimate for the annual payment that employers would be
required to make to the authority is based on information from
the Texas Workforce Commission. Unemployment insurance is paid
on the first $9,000 of wages, and the rate ranges from 0.27
percent to more that 6 percent, depending on an employer's experience
rating. The statewide average rate in 1996 was 1.47 percent
and is projected to be 1.36 percent in 1997.
Under the federal
Prison Industry Enhancement Program guidelines, the state may
make various deductions from an inmate's wages, including victim
compensation and reimbursement to the state for a portion of
the costs of incarceration. Victim compensation and offender
reimbursements per fiscal year are estimated.
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 Revenue Probable Revenue Probable Revenue Probable Change in Number
Gain/(Loss) from Gain/(Loss) from Gain/(Loss) from Savings/(Cost) of State
General Revenue Compensation to New GR-Dedicated from New Employees from
Fund Victims of Crime Account - GR-Dedicated FY 1997
Account/ Account -
GR-Dedicated
0001 0469 8021 8021
1998 $156,000 $178,000 $30,000 ($30,000) 3.0
1998 938,000 713,000 92,000 (92,000) 3.0
2000 1,900,000 1,474,000 153,000 (104,000) 3.0
2001 3,090,000 2,457,000 245,000 (104,000) 3.0
2002 4,750,000 3,825,000 367,000 (104,000) 3.0
Net Impact on General Revenue Related Funds:
The probable fiscal implication to General Revenue related funds
during each of the first five years is estimated as follows:
Fiscal Year Probable Net Postive/(Negative)
General Revenue Related Funds
Funds
1998 $156,000
1999 938,000
2000 1,900,000
2001 3,090,000
2002 4,750,000
Similar annual fiscal implications would continue as long as
the provisions of the bill are in effect.
No significant fiscal implication to units of local government
is anticipated.
Source: Agencies: 696 Department of Criminal Justice
304 Comptroller of Public Accounts
694 Youth Commission
LBB Staff: JK ,CB ,JN