LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session March 19, 1997 TO: Honorable Carlos F. Truan, Chair IN RE: Senate Bill No. 771 Committee on International Relations, Trade & Technology By: Moncrief Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on SB771 ( Relating to the licensing of the name, logo, and other artwork of the Texas Commission on the Arts.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by SB771-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 This bill would allow the Texas Commission on the Arts (TCA) to license the use of its name, logo, or artwork and graphics developed by the TCA to a private vendor. The bill would allow the TCA to purchase and resell these items to promote arts in Texas. The bill would require the use of licensed property to be consistent with TCA's mission. The bill would require the licensing fees and the net profits from sales to be deposited in the Texas Commission on the Arts Operating Fund. Methodolgy The agency expects to have a two year development stage for designing and introducing new promotional products for sale and licensing, resulting in a relative increase in revenue by the year 2000. In the 1998-99 biennium, the agency would begin collecting revenue by selling TCA promotional items such as T-shirts and cups, and by obtaining licensing fees for use of TCAnet from arts-related private vendors, artists, craftsmen, non-profit and cultural organizations. The costs to the agency for implementing this bill would include the cost of purchasing promotional merchandise and the use of professional services to design graphics, artwork and merchandise. In addition to using existing agency resources to implement this bill, the agency would require an additional .5 FTE to promote, sell and license the agency name, logo, and specific products. 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 Change in Number Savings/(Cost) Gain/(Loss) from of State from Commission Commission on Employees from on the Arts the Arts FY 1997 Operating Operating Account/ Account/ GR-Dedicated GR-Dedicated 0334 0334 1998 ($68,050) $100,000 0.5 1998 (69,550) 110,000 0.5 2000 (73,550) 170,000 0.5 2001 (75,950) 182,000 0.5 2002 (78,250) 200,000 0.5 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 No fiscal implication to units of local government is anticipated. Source: Agencies: LBB Staff: JK ,TH ,NT