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