LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session March 25, 1997 TO: Honorable Kenneth Armbrister, Chair IN RE: Senate Bill No. 1131 Committee on State Affairs By: Ellis Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on SB1131 ( Relating to the regulation of cosmetologists; providing an administrative penalty.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by SB1131-As Introduced Implementing the provisions of the bill would result in a net positive impact of $7,372,000 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 amend Article 8451a, Vernon's Texas Civil Statutes to double the current cosmetology licensing fees, and give the Cosmetology Commission the authority to assess administrative penalties for violations of the Cosmetology Act. This bill would take effect September 1, 1997. Methodolgy The estimated gain in revenue assumes there would not be a decline in the number of licensees as a result of the fee increase. The estimate is derived by multiplying estimated annual fee collections for fiscal year 1997 by two and holding that amount constant over the five year period. The estimate assumes there will be small amounts of administrative penalties deposited to the General Revenue as the provisions of the bill are enforced. Based on the Cosmetology Commission's Legislative Appropriations Request, implementing the provisions of this bill would require an increase in staff of 16.5 enforcement staff and 5.5 licensing staff and associated operating costs, including cost for administrative hearings. The higher costs in FY1998 are due to one time equipment purchases. 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 Revenue Probable Change in Number Gain/(Loss) from Savings/(Cost) of State General Revenue from General Employees from Fund Revenue Fund FY 1997 0001 0001 1998 $4,710,000 ($1,097,000) 22.0 1998 4,710,000 (951,000) 22.0 2000 4,710,000 (951,000) 22.0 2001 4,710,000 (951,000) 22.0 2002 4,710,000 (951,000) 22.0 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 $3,613,000 1999 3,759,000 2000 3,759,000 2001 3,759,000 2002 3,759,000 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. No fiscal implication to units of local government is anticipated. Source: Agencies: 360 State Office of Administrative Hearings 505 Cosmotology Commission LBB Staff: JK ,JD ,CG