LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 26, 2001
TO: Honorable Steven Wolens, Chair, House Committee on State
Affairs
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB1736 by Wolens (Relating to the enhanced availability
of advanced telecommunications services.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB1736, As Introduced: positive impact of $0 through the biennium *
* ending August 31, 2003. *
* *
* 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 *
* 2002 $0 *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 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 *
* Appropriated Appropriated FY 2001 *
* Receipts Receipts *
* 0666 0666 *
* 2002 $(680,614) $680,614 10.0 *
* 2003 (654,514) 654,514 10.0 *
* 2004 (654,514) 654,514 10.0 *
* 2005 (654,514) 654,514 10.0 *
* 2006 (654,514) 654,514 10.0 *
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Technology Impact
The agency estimates it would need 10 additional computers for the
additional staff to contract with any rural institutions, person, or
anchor tenants for use of the consolidated telecommunications systems.
The costs for the computers would be $22,000.
Fiscal Analysis
This bill would require the Public Utilities Commission (PUC) to create
and maintain a database capable of graphic representation containing the
location and inventory of all public and private sector
telecommunications and advanced services facilities. The bill would also
make the PUC responsible for strategic planning for deployment of
advanced services to end-use customers.
This bill would also provide avenues for rural communities with
populations less than 20,000 and for communities with populations of less
than 2,000 to seek funding for advanced services projects and allow
state agencies and local governments to cease participation in the state
consolidated telecommunications system.
This bill would add the rural economic development account to the
telecommunications infrastructure fund (TIF) and would allow the TIF
board to use funds in the account to award grants for the provision of
equipment or infrastructure for community networks and community
technology centers and award a loan for the provision of advanced
services. In addition, the bill establish the Rural Economic Development
Grant and Loan Program which would allow any rural institution or person
to seek funding for planning and development of access to advanced
services and establish standards for rural communities attempting to
aggregate demand for advanced services.
The bill would allow state agencies to compete with private enterprise in
the telecommunications market and authorize the General Services
Commission (GSC) to contract with any rural institutions, persons, or
anchor tenants for use of the consolidated telecommunications system.
The GSC would also be authorized to set standards for contracts and
allocate funding for planning and rural access to advanced services.
Methodology
Based on an estimate from the General Services Commission (GSC), there
would be a need for ten additional staff members. The GSC would need
four Network Specialist (annual costs of $225,773 including benefits) who
would be responsible for contract review and marketing to rural
communities to bring new customers into the state's telecommunications
system. There would also be a need for four Systems Analysts (annual
costs of $241,167 including benefits) who would be the project managers,
who would be responsible for development, installation, and maintenance
of the telecommunications system. There would also be two Administrative
Technicians (annual costs of $61,574 including benefits) who would be
responsible for identifying potential customers, billing, and other
administrative duties. It is also estimated there would be additional
operating expenses, such as travel and the hiring of telecommunications
specialists when needed, of $126,000 and start up cost of $26,100 for
computers, installation of telephones, and other equipment.
Note: In its estimate of possible revenue loss, the GSC included an
additional $8.7 million loss in Interagency Contracts due to the
provision in the bill, which would allow state agencies and local
governments to cease participation in the state consolidated
telecommunications system if they could find more favorable terms and
conditions. However, the agency did not consider that rural communities
may join the state consolidated telecommunications system, which would
offset potential revenue losses, and that the cost to operate the state's
telecommunications system is currently below the industry average.
According to the Public Utilities Commission and Telecommunications
Infrastructure Fund Board, implementation of the bill would result in
some additional agency activities which could be absorbed within the
existing agency resources.
Although this bill would add a new account to the Telecommunications
Infrastructure Fund 0345 (TIF), the Comptroller of Public Accounts
determined there would be no impact on state revenues to Fund 0345
because the bill would not change the current rate and structure of the
TIF assessment imposed under Subchapter C, Chapter 57, Utilities Code.
Local Government Impact
No significant fiscal implication to units of local government is
anticipated.
Source Agencies: 477 Commission on State Emergency Communications,
475 Office of Public Utility Counsel, 473 Public
Utility Commission of Texas, 480 Department of
Economic Development, 367 Telecommunications
Infrastructure Fund Board, 303 General Services
Commission, 304 Comptroller of Public Accounts
LBB Staff: JK, RB, GS, KM