LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session February 13, 1997 TO: Honorable Eddie Lucio, Jr., Chair IN RE: Senate Bill No. 342, Committee Report 1st House Committee on Intergovernmental Relations By: Gallegos Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on SB342 ( Relating to the disposition of the optional county road and bridge fee in certain counties.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by SB342-Committee Report 1st House 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. Fiscal Analysis This bill would require that Harris county allocate funds it receives through the Optional Road and Bridge Fee as provided in Section 502.172, Transportation Code, to projects in each of the 34 municipalities and the unincorporated sections of Harris County in proportion to the population of each entity. The provisions of this bill would take effect on March 1, 1998, the beginning of the Harris County fiscal year. Methodolgy According to data from the Office of the Comptroller of Public Accounts, Harris County retained $23,502,714 in Optional Road and Bridge Fees during fiscal year 1996. Based on Harris County reported expenditures under Chapter 502, Transportation Code, for calendar years 1995 and 1996, approximately 25% of allocations were made toward construction projects, with the remaining 75% going to maintenance activities. The Harris County Engineer's office reports that virtually all maintenance funds are allocated to unincorporated sections, while a portion of construction funds is actually spent in incorporated cities in Harris County. Assuming that 50% of construction funds are allocated evenly to projects in municipalities throughout Harris County, approximately 12.5% of the total funds affected by this bill are currently being spent by Harris County on projects inside incorporated areas, with the remaining 87.5% being spent in unincorporated areas. According to 1990 US Census data, the incorporated sections of Harris County's total population of 2,818,199 account for 1,991,716 residents, or 70.6%, while unincorporated areas account for 826,716 residents, or 29.3%. Consequently, upon enactment of this bill, Harris County would be required to reduce the allocation of Optional Road and Bridge Fee funds to unincorporated areas of the County from 87.5% of the approximately $23.5 million per year, or $20,562,500, to 29.3%, or $6,891,760 or an annual net loss in revenue for projects in unincorporated areas of $13,670,740. In contrast, the 34 cities in Harris County would collectively realize an increase of $13,670,740 annually in Optional Road and Bridge Fee allocations. The probable fiscal implications of implementing the provisions of the bill during each of the first five years following passage is estimated as follows (impact on Harris County, its six largest cities and the aggregate impact on the 28 smaller cities is shown): Five Year Impact: Fiscal Year Probable Revenue Probable Revenue Probable Revenue Probable Revenue Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to Harris County the City of City of Pasadena City of Baytown Houston LCL-COUNTY LCL-CITY LCL-CITY LCL-CITY 1998 ($6,835,370) $5,503,549 $409,642 $225,524 1998 (13,640,740) 11,007,099 819,284 451,048 2000 (13,640,740) 11,007,099 819,284 451,048 2001 (13,640,740) 11,007,099 819,284 451,048 2002 (13,640,740) 11,007,099 819,284 451,048 Fiscal Year Probable Revenue Probable Revenue Probable Revenue Probable Revenue Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to Gain/(Loss) to City of La Porte City of Deer Park City of South 28 other Cities Houston in Harris County LCL-CITY LCL-CITY LCL-CITY LCL-CITY 1998 $95,829 $94,899 $48,757 $457,170 1999 191,658 189,798 97,514 914,341 2000 191,658 189,798 97,514 914,341 2001 191,658 189,798 97,514 914,341 2002 191,658 189,798 97,514 914,341 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. Source: Agencies: 304 Comptroller of Public Accounts 601 Department of Transportation LBB Staff: JK ,TL