LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
March 25, 1997
TO: Honorable Kim Brimer, Chair IN RE: House Bill No. 3522
Committee on Business & Industry By: Rhodes
House
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on HB3522 ( Relating
to the administration and enforcement of the workers' compensation
law; providing penalties.) this office has detemined the following:
Biennial Net Impact to General Revenue Funds by HB3522-As Introduced
Implementing the provisions of the bill would result in a net
impact of $0 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 amend Section 403.002(a) of the Labor Code to
require the maintenance tax assessed on workers' compensation
premiums to support the prosecution of workers' compensation
insurance fraud. This would require a new assessment in addition
to current workers' compensation maintenance tax collections;
this new assessment would be limited to a maximum of one-tenth
of one percent of workers' compensation insurance premiums.
Also, the bill would amend Section 407.103(a) of the Labor
Code to require the self insurer maintenance tax to support
the prosecution of workers' compensation insurance fraud. This
would require a new assessment in addition to current self insurer
maintenance tax collections; this new assessment would be limited
to a maximum of one-tenth of one percent of the total tax base
of all certified self insurers. The maximum amount that could
be collected by these two new assessments is estimated to be
$2.7 million per fiscal year.
The Texas Workers' Compensation
Commission (TWCC) would enter into contracts with District Attorney's
(D.A.) offices to prosecute workers' compensation insurance
fraud. The costs of these contracts would be offset by increased
maintenance tax collections, as allowed by Sections 403.002(a)
and 407.103(a). It is estimated that the cost of these contracts
would be $83,294 in FY 1998, $140,281 in FYs 1999 through 2002.
Methodolgy
Contract costs were based on the following assumptions:
(1)
In FY 1998, approximately 45 complaints would be referred to
D.A. offices. After implementation of the program the number
of complaints referred to D.A. offices would increase; therefore,
program costs would increase after FY 1998.
(2) The equivalent
of one prosecutor would be needed in FY 1998; the equivalent
of two prosecutors would be needed in FYs 1999 through 2002;
and,
(3) The equivalent of one administrative technician
would be needed each fiscal year.
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 ($83,294) $83,294
1998 (140,281) 140,281
2000 (140,281) 140,281
2001 (140,281) 140,281
2002 (140,281) 140,281
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 $0
1999 0
2000 0
2001 0
2002 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: Agencies: 453 Workers' Compensation Commission
478 Research & Oversight Council on Worker's Compensation
304 Comptroller of Public Accounts
LBB Staff: JK ,TH ,BK