LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  April 1, 1997
         
         
      TO: Honorable Kenneth Armbrister, Chair            IN RE:  Senate Bill No. 965
          Committee on State Affairs                              By: Armbrister
          Senate
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB965 ( Relating 
to the powers and duties of the Public Utility Commission of 
Texas.) this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB965-As Introduced
         
No significant fiscal implication to the State is anticipated. 
 
         

         
 
This bill would amend the Public Utility Regulatory Act of 1995 
(PURA) to amend the powers and duties of the Public Utility 
Commission (PUC) and establish a statutory framework to implement 
various proposals from the Texas Performance Review (TPR) report, 
"Light Years: The Future of the Public Utility Commission on 
Texas."

Section 1 of the bill would amend Section 1.002 of 
PURA to state that the oversight role of PUC must increase and 
move toward customer service and protection and promotion of 
public awareness.  

Section 9 of the bill would add Sections 
1.105 through 1.109 to PURA.  Section 1.105 would require PUC 
to adopt procedures authorizing disposition of contested cases 
by use of proposed orders.  Section 1.106 would require PUC 
to adopt procedures to dispose of contested cases by use of 
staff reports (detailing the information and evidence the staff 
would have presented in a contested case hearing).  Section 
1.107 would require PUC to adopt procedures to use alternative 
dispute resolution (ADR) to resolve a pending issue or proceeding.

Section 
1.108 would allow PUC to establish and ensure service quality 
and reliability standards for both electric and telephone providers. 
 Existing PUC staff would be adjusted to accommodate the increased 
workload without additional cost to the state.

Section 1.109 
would clarify PUC's authority to educate and provide information 
to consumers and providers of electric and telecommunications 
services.

Sections 12 and 13 of the bill would amend Sections 
1.401 and 2.003 of PURA to require PUC to submit a report to 
the legislature, not later than January 15 of each odd-numbered 
year, on complaints received from consumers during the previous 
two years.  This activity would be absorbed with existing PUC 
resources.

Section 20 of the bill would transfer revenue 
deposited in the Universal Service Fund to a dedicated account 
in the state treasury.  The fund consists of charges assessed 
on local exchange companies and is used to assist these companies 
in providing basic local telecommunications services in high-cost 
rural areas and to low-income persons, and to provide relay 
service for the hearing and speech impaired.

Section 21 of 
the bill would require PUC and the Comptroller to conduct and 
prepare a joint study, for submission not later than January 
15, 1999, on the structure of the gross receipts tax and the 
potential effect of deregulation on the revenue generated by 
this tax during the next ten years.  This workload could be 
absorbed using current PUC and Comptroller resources.

Note: 
Sections 1, 9, 12, and 13 of the bill would establish a framework 
to implement TPR recommendations related to strengthening consumer 
affairs functions and case streamlining.  The Comptroller estimates 
that if these TPR recommendations were implemented there would 
be a slight net savings to General Revenue because increased 
staffing and communications requirements needed to perform consumer 
education and consumer complaint functions would be offset by 
reduced hearings charges as a result of the use of proposed 
orders and ADR.  PUC's estimate of the TPR report's costs are 
higher and its estimate of savings are lower than the Comptroller's. 
 PUC has estimated during the appropriations process that the 
net cost of additional resources needed to strengthen its consumer 
affairs functions to fully implement the TPR recommendations 
would be $391,200 in FY 1998 and $332,000 in FY 1999.  Because 
these estimates relate to increasing resources to perform functions 
generally authorized under current law, they are not included 
in this analysis.

The bill would recreate a special fund 
(the Universal Service Fund) and a dedicated revenue source 
in the State Treasury. The recreation and/or continuation of 
 special funds and dedicated revenue sources outside the General 
Revenue Fund could further restrict the Legislature's ability 
to appropriate revenues for general operating purposes.
          
No fiscal implication to units of local government is anticipated.
          
   Source:            Agencies:   473   Public Utility Commission of Texas
                                         475   Office of the Public Utility Counsel
                                         304   Comptroller of Public Accounts
                                         360   State Office of Administrative Hearings
                                         
                      LBB Staff:   JK ,JD ,BK