LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
March 31, 1999
TO: Honorable David Sibley, Chair, Senate Committee on
Economic Development
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1775 by Sibley (relating to the regulation of certain
providers of service contracts), Committee Report 1st
House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1775, Committee Report 1st House, Substituted: positive impact *
* of $0 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 $0 *
* 2001 0 *
* 2002 0 *
* 2003 0 *
* 2004 0 *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Revenue Change in Number of *
* Year Savings/(Cost) from Gain/(Loss) from State Employees from *
* General Revenue Fund General Revenue Fund FY 1999 *
* 0001 0001 *
* 2000 $(401,227) $401,227 5.0 *
* 2001 (343,183) 343,183 5.0 *
* 2002 (382,238) 382,238 5.0 *
* 2003 (375,938) 375,938 5.0 *
* 2004 (375,938) 375,938 5.0 *
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Fiscal Analysis
The bill would require the Texas Department of Licensing and Regulation
(TDLR) to regulate certain providers of service contracts. Service
contracts would be defined as agreements in which a provider agrees to
repair, replace, or maintain a product, or provide for payment of
indemnity under certain circumstances, including towing or emergency road
service. The bill would require TDLR to register providers of service
contracts, and to handle complaints and other enforcement related issues.
The bill would also allow TDLR to impose administrative penalties for
violations of the act.
The bill would allow TDLR to charge service contract providers a fee not
to exceed $2,000 to cover the costs of administering the regulatory
program.
The bill would also create a six member "Service Contract Providers
Advisory Board."
Methodology
It is estimated that TDLR would incur costs to develop a registration
program for service contract providers. Costs would be highest in the
first year after enactment. In the following years, it is assumed that
the agency would continue to register providers, and would respond to
complaints regarding licensed service contract providers. It is assumed
that complaint resolution would form the bulk of the agency's program
after the first year, and that five additional employees would be able to
handle the additional registration and enforcement requirements.
It is assumed that TDLR would set fees at a level sufficient to offset
the costs of the program.
Local Government Impact
No significant fiscal implication to units of local government is
anticipated.
Source Agencies:
LBB Staff: JK, TH, CB