LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
March 31, 1999
TO: Honorable Bob Turner, Chair, House Committee on Public
Safety
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2617 by Bosse (Relating to the continuation of the
Texas Board of Private Investigators and Private Security
Agencies as the Private Security Commission and to the
functions performed by that agency; providing a
penalty.), Committee Report 1st House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2617, Committee Report 1st House, Substituted: positive impact *
* of $158,500 through the biennium ending August 31, 2001. *
* *
* The bill would make no appropriation but could provide the legal *
* basis for an appropriation of funds to implement the provisions of *
* the bill. *
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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2000 $79,250 *
* 2001 79,250 *
* 2002 79,250 *
* 2003 79,250 *
* 2004 79,250 *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Savings/(Cost) from Probable Revenue Gain/(Loss) *
* Year General Revenue Fund from General Revenue Fund *
* 0001 0001 *
* 2000 $41,750 $37,500 *
* 2001 41,750 37,500 *
* 2002 41,750 37,500 *
* 2003 41,750 37,500 *
* 2004 41,750 37,500 *
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Fiscal Analysis
The bill would continue the Board of Private Investigators and Private
Security Agencies under the new name of the Private Security Commission
(the "Board" or "Agency") until September 1, 2003. The bill would
increase public representation on the Board from six members to nine
members. The bill would apply the Private Security Agencies Act (the
"Act") to uniformed security employees of certain entities to which the
general public has access. The bill would transfer the agency's
administrative hearing function to the State Office of Administrative
Hearings (SOAH). The bill would allow the Agency to enter into
reciprocal agreements with other states. The bill would remove the
requirement for letters of notification to be sent to certain law
enforcement officials.
Methodology
Board member per diem is set at a maximum of $2,500 per year. The
addition of three public members to the Board would result in an increase
cost of $7,500 per year.
The bill would apply the Act to an individual who in the course of their
employment regularly come into contact with the public, and wears a
uniform with any type of badge or patch commonly associated with law
enforcement or security personnel. Neither the Sunset Commission nor the
Agency were able to provide detailed numbers as to the fiscal impact of
this provision of the bill. Based on the fact that this provision would
extend Board oversight to security personnel at malls, amusement parks,
athletic facilities, large corporate buildings, and others, the revenue
gain to General Revenue could be quite considerable as would an increase
in workload at the Agency. Since the agency was appropriated 49% of the
receipts it collects, the state would see a net gain in General Revenue
of 51 cents for every dollar, assuming that the Agency is given
additional appropriations to deal with the increased workload.
Transferring the agencies administrative hearings process to SOAH would
result in an estimated net loss to the agency of $76,750 per fiscal year.
Although the agency would experience savings, given that it would no
longer need an administrative law judge, the agency would incur costs of
$112,000 for the retention of two legal staff to prepare cases for
hearings before SOAH; and an estimated $190,936 in costs for new expenses
relating to the billing from SOAH for all Agency hearings. The Sunset
Commission comments that the costs tend to be more pronounced initially,
but as both agencies adjust their resources to accommodate the transfer
the cost should decrease.
Allowing the agency to enter into reciprocal agreements with other states
and provide provisional licenses or registrations to other states'
registrants would generate additional revenue for the state. It is
estimated that if the Board were to enter into an agreement just with
Oklahoma, state revenue would increase by $71,250. This estimate is
based on 15% of companies licensed in Oklahoma choosing to exercise their
eligibility for a license and registration in Texas. In addition to
Oklahoma, Arkansas, New Mexico and Louisiana have expressed interest in
having reciprocal agreements.
The bill would remove the requirement for letters of notification to be
sent to certain law enforcement officials. The Sunset Commission
relates that the Board processed approximately 42,000 registration
applications per year. Assuming two letters per application at $1.50
(postage costs for business correspondence), this will save the Board
$126,000 (84,000 x 1.5) in postage costs per year and $252,000 in
postage costs for the biennium.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies:
LBB Staff: JK, MD, DG