LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  March 4, 1997
         
         
      TO: Honorable Kenneth Armbrister, Chair            IN RE:  Senate Bill No. 259
          Committee on State Affairs                              By: Moncrief
          Senate
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB259 ( Relating 
to the regulation of roofing contractors; providing penalties.) 
this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB259-As Introduced
         
Implementing the provisions of the bill would result in a net 
positive impact of $222,872 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 require the Department of Licensing and Regulation 
(TDLR) to license roofing contractors and provides for criminal 
and administrative penalties.  Examinations at various locations 
and reciprocity agreements with other states would be required 
to license these contractors. Liability insurance and bonding 
requirements are also specified.  The TDLR would also be required 
to publish an annual directory of all persons licensed under 
this legislation.  In addition, this bill would provide for 
the creation of a six member Roofing Contractors Advisory Board. 
   This bill would allow the Department to employ personnel 
as necessary for implementation and authorize additional expenditures 
including office expenses, equipment, and other necessary facilities.
 
Methodolgy
 
According to the TDLR, an additional 23 FTEs would be required 
to implement the provisions of this bill.  Most of the costs 
are related to examination administration.  The agency assumes 
that 15,000 contractors would be required to have a license. 
 The agency would examine and license 6,000 people in the first 
year.  The second year would include 6,000 additional new licensees 
and 6,000 renewals from the first year.  In the third year, 
the agency would license any remaining contractors requiring 
licenses (about 3,000) and continue license renewals.   The 
initial license fee would be $175 per contractor and annual 
license renewals would be $125 per contractor. Regulation of 
this industry would also result in new administrative hearings 
from complaints originated in the industry.  The agency assumes 
30 administrative hearings would result from 900 complaints 
received annually.  This analysis assumes that the Commission 
would set fees necessary to cover the costs of administering 
this Act. 
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   Salaries/Wages
Probable Change in Number   
            Savings/(Cost)     Gain/(Loss) from   Savings/(Cost)     of State                             
            from General       General Revenue    from General       Employees from                       
            Revenue Fund       Fund               Revenue Fund       FY 1997                              
            0001               0001               0001                                                     
       1998        ($520,864)        $1,050,000        ($497,700)              23.0                  
       1998         (360,864)         1,050,000         (497,700)              23.0                  
       2000         (351,864)         1,875,000         (497,700)              23.0                  
       2001         (367,864)         1,875,000         (497,700)              23.0                  
       2002         (367,864)         1,875,000         (497,700)              23.0                  
 
 
         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              $31,436
               1999              191,436
               2000            1,025,436
               2001            1,009,436
               2002            1,009,436
 
Similar annual fiscal implications would continue as long as 
the provisions of the bill are in effect.
          
Revenue impacts to local governments would occur as a result 
of deferring licensing requirements to the state. Local governments 
currently regulating roofing contractors would be limited to 
only enforcement authorization.  Currently, the City of San 
Antonio generates approximately $47,000 per year in roofer licensing; 
the City of Fort Worth collects approximately $60,000 in roofer 
licensing.
          
   Source:            Agencies:   452   Department of Licensing and Regulation
                                         
                      LBB Staff:   JK ,JD ,RA