HBA-CBW H.B. 1412 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1412 By: Flores Land & Resource Management 2/23/2001 Introduced BACKGROUND AND PURPOSE The General Land Office (GLO) has statutory authority to review the real property holdings of the Texas Department of Transportation (TxDOT) every four years. Despite the current appraisal value of these properties, state government accounts record the purchase price of the property or the appraised value of the property on the date of acquisition, regardless of whether the acquisition occurred in 1890 or 1990. In a report by the Texas Comptroller of Public Accounts entitled, "Paving the Way," GLO records of TxDOT's real property reveal a total historical cost of $92.3 million; yet, GLO's 1996 report on TxDOT lands and buildings, not including lands owned for highway rights-of-way, appraised TxDOT's real property at $165.3 million, nearly twice the historical cost. The 1998 market value of TxDOT's real property holdings was placed at $266.4 million, almost three times the historical cost. House Bill 1412 requires TxDOT to pay an annual capital charge, which may be viewed as an annual market-based rent applied by a government to its units that own real property, for each item of real property, excluding rightsof-way, owned by TxDOT, to create an incentive for TxDOT to manage its real property more efficiently. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 1412 amends the Transportation Code to require the Texas Department of Transportation (TxDOT) to pay to the state, during September of each state fiscal year, a capital charge in an amount equal to seven percent of the appraised value of each item of real property owned by TxDOT excluding rights-of-way. The bill authorizes TxDOT to receive legislative appropriations to pay capital charges in an amount equal to a percentage of TxDOT's capital charge for the year computed in a specified manner. The bill requires TxDOT to submit to the General Land Office (GLO), on a quarterly basis and in a format and manner determined by GLO, specified information on any real property owned by TxDOT. The bill requires GLO to provide such information to the Texas Comptroller of Public Accounts. In addition, the bill requires GLO, on request, to provide the information to the General Services Commission and the Legislative Budget Board (LBB). The bill authorizes LBB to request from GLO a detailed analysis of real property owned by TxDOT, including potential uses of the property and the likelihood of lease or sale of the property in the following two-year period. The bill requires TxDOT to submit to GLO TxDOT's first report on real property owned by TxDOT not later than December 1, 2001. The bill requires TxDOT to determine the appraised value or estimated market value of any real property owned by TxDOT not later than September 1, 2003. The bill authorizes TxDOT to contract with GLO to perform an appraisal or estimate. The bill provides that TxDOT is not required to pay a capital charge before September 1, 2003. EFFECTIVE DATE September 1, 2001.