LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
May 5, 1997
TO: Honorable Fred Hill, Chair IN RE: Senate Bill No. 1502, Committee Report 2nd House, Substituted
Committee on Urban Affairs By: Ellis
House
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on SB1502 ( Relating
to the transfer of certain money into the housing trust fund.)
this office has detemined the following:
Biennial Net Impact to General Revenue Funds by SB1502-Committee Report 2nd House, Substituted
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 amends Section 2306.205 of the Government Code by
requiring the transfer of any certain fees the Department of
Housing and Community Affairs receives which are in excess of
the amount needed to pay administrative costs of the 501(c)(3)
bond program to the Housing Trust Fund in the Texas Treasury
Safekeeping Trust Company. The bill also provides guidelines
for the use of the 501(c)(3) bonds for the department and the
Texas State Affordable Housing Corporation (TSAHC), the department's
non-profit corporation.
Methodolgy
The department assumes a cumulative amount of $1.14 billion
in issued bonds over a five-year period. Property developers
pay origination fees for loans from the bond proceeds at an
approximate rate of 0.5 percent of the bond amount. These fees
are paid at the time of bond issuance. The origination fees
would be the basis for gains to the Housing Trust Fund in the
Texas Treasury Safekeeping Trust Company. Although the department
has not previously had earnings remaining after payment of expenses
and reserves, the department anticipates initiating an increased
number of multi-family projects, resulting in increased excess
earnings related to origination fees. These earnings assume
that the department is authorized to collect asset oversight
fees for the developed projects. The department may eventually
require additional staff support to handle an increased workload
resulting from a higher level of bond issuances.
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
Savings/(Cost)
from Other -
Texas Treasury
Safekeeping
Trust Company
OTHER-OTH
1998 $599,516
1998 849,164
2000 1,113,332
2001 1,275,616
2002 1,439,266
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.
No fiscal implication to units of local government is anticipated.
Source: Agencies: 332 Department of Housing and Community Affairs
LBB Staff: JK ,TL ,RA