SRC-BWC S.B. 482 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 482
77R4679 BDH-DBy: Duncan
State Affairs
2/7/2001
As Filed


DIGEST AND PURPOSE 

Currently, state agencies receiving federal grant or project funds are
allowed to keep a portion of those funds to cover local administrative
costs, in a process known as "indirect cost recovery." Componetization of
buildings that are eligible for indirect cost recovery allows accelerating
depreciation on shorter-life components and increases the amount of federal
dollars that agencies may withhold for indirect costs.  As proposed, S.B.
482 requires state agencies receiving federal funds to break the value and
estimated life of their buildings into major components when the building
components are replaced.  Breaking buildings into their fundamental
components as an administrative approach offers invaluable management
information for planning and budgeting purposes. 

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the comptroller of public
accounts (comptroller)  in SECTION 1 (Section 2101.015), Government Code,
of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 2101B, Government Code, by adding Section
2101.015, as follows: 

Sec. 2101.015.  COMPONENTIZATION FOR AGENCY RECEIVING FEDERAL FUNDS.
Defines "componentization."  Requires a state agency that receives federal
funds to implement federal or joint federal and state programs to complete
a componentization of any agency-owned building with a fair market value of
at least $1 million.  Requires each building component as it is being
replaced to be separately depreciated based on it's individual useful life.
Requires the agency, at a minimum, to complete any componentization using
specific component categories and suggested useful lives.  Authorizes the
comptroller by rule to modify the schedule prescribed by Subsection (c). 

SECTION 2.  Effective date:  September 1, 2001.
                       Makes application of this Act prospective.