LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
April 22, 1999
TO: Honorable J.E. "Buster" Brown, Chair, Senate Committee on
Natural Resources
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB 1690 by Bernsen (relating to coastal erosion),
Committee Report 1st House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1690, Committee Report 1st House, Substituted: negative impact *
* of $(12,600,000) 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 $(6,300,000) *
* 2001 (6,300,000) *
* 2002 (6,300,000) *
* 2003 (6,300,000) *
* 2004 (6,300,000) *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Savings/(Cost) Revenue Savings/(Cost) *
* from General from Coastal Gain/(Loss) to from New - GR *
* Revenue Fund Protection New - GR Dedicated- *
* 0001 Account/ Dedicated- Coastal Erosion *
* GR-Dedicated Coastal Erosion Response Account *
* 0027 Response Account *
* 2000 $(6,300,000) $(1,200,000) $10,500,000 $(10,500,000) *
* 2001 (6,300,000) (1,200,000) 12,500,000 (12,500,000) *
* 2002 (6,300,000) (1,200,000) 12,500,000 (12,500,000) *
* 2003 (6,300,000) (1,200,000) 12,500,000 (12,500,000) *
* 2004 (6,300,000) (1,200,000) 12,500,000 (12,500,000) *
***************************************************************************
Fiscal Analysis
The bill would require the General Land Office (GLO) to implement a
program of coastal erosion avoidance, remediation, planning, and public
education to protect the common law rights of the public in public
beaches on the Gulf and bay shorelines.
The bill would establish a new General Revenue Dedicated Account-Coastal
Erosion Response Account (CERA), which only could be appropriated to the
Commissioner of the General Land Office (commissioner) and used for
coastal erosion programs.
The bill would add coastal erosion response projects to the list of
allowable uses of General Revenue Dedicated Account 0027 - Coastal
Protection (Account 0027). The bill would provide that the amount used
for erosion response purposes be at the discretion of the commissioner
but in an amount not to exceed the interest accruing to Account 0027
annually. No reimbursement to Account 0027 would be required.
Methodology
The bill would provide that funds for the new account (CERA) could come
from a variety of sources including appropriations; grants from the
federal government; money from the sale of dredged material; and interest
accruing annually to Account 0027.
According to the Comptroller, revenue for Account 0027 totaled
approximately $6 million for fiscal 1998, and interest revenue from the
fund was approximately $1 million, as reported in the state's 1998 Annual
Cash Report, Volume Two.
According to the GLO, Article VI of House Bill 1 (engrossed) would allow
the GLO to conduct the coastal erosion control program created by the
bill (C.S.H.B. 2560). The program, if fully funded by the Legislature,
would include: 1) $6.3 million in General Revenue funding, of which GLO
assumes $5.2 million would come from the state hotel occupancy tax from
the thirteen coastal counties which would benefit from the bill; and 2)
$1.2 million in interest earned from funds in the Coastal Protection
Account - 0027. According to the GLO, this level of state
participation is estimated to allow the GLO to apply for and obtain $3
million in federal funds in fiscal year 2000 and $5 million in fiscal
year 2001.
Local Government Impact
According to the General Land Office (GLO), the bill will help maintain
the local sales, hotel/motel, and property tax basis and will therefore
have a positive fiscal impact overall for units of local governments on
the coast. While projects funded entirely by the state are possible, the
bill gives preference to projects for which there is a local match, so
it is anticipated that coastal local governments will desire to
contribute to the cost of erosion response projects. The GLO anticipates
total local government contributions of approximately $2.5 million per
year.
The commissioner, under certain circumstances, could require an appraisal
district and a taxing unit to remove from the appraisal and tax rolls,
land that became submerged by erosion or subsidence.
Source Agencies: 304 Comptroller of Public Accounts, 305 General
Land Office and Veterans' Land Board
LBB Staff: JK, DE, TT