LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session April 17, 1997 TO: Honorable Steven Wolens, Chair IN RE: House Bill No. 2600, Committee Report 1st House, Substituted Committee on State Affairs By: King House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB2600 ( relating to the collection of delinquent obligations to the state.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB2600-Committee Report 1st House, Substituted Implementing the provisions of the bill would result in a net positive impact of $2,650,000 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 This bill would amend the Government Code to allow the Comptroller to employ, retain, or contract with a person, other than a full-time state employee, to collect certain delinquent obligations that are owed to the Comptroller. The collection efforts would not be directed at the normal delinquent accounts, but at the small accounts not reached successfully by routine collection and too small for referral to the Office of the Attorney General. A contract could include a collection fee computed on the amounts collected under the contract. Methodolgy The fiscal impact of hiring a collection firm is based on estimates of commissions and variations in the outstanding volume of certain delinquent tax accounts. This estimate assumes that all eligible delinquent debt at the time of the startup would be collected by a collection firm in fiscal years 1998 and 1999. 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 Revenue Savings/(Cost) Gain/(Loss) from from General General Revenue Revenue Fund Fund 0001 0001 1998 ($358,000) $1,434,000 1998 (524,000) 2,098,000 2000 (275,000) 1,101,000 2001 (283,000) 1,134,000 2002 (292,000) 1,168,000 Net Impact on General Revenue Related Funds: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $1,076,000 1999 1,574,000 2000 826,000 2001 851,000 2002 876,000 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: Agencies: 302 Office of the Attorney General 304 Comptroller of Public Accounts LBB Staff: JK ,JD ,RN