LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                                May 7, 2001
  
  
          TO:  Honorable Carlos F. Truan, Chair, Senate Committee on
               Veteran Affairs & Military Installations
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB2040  by Hawley (Relating to defense base development
               authorities created by certain municipalities.), As
               Engrossed
  
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*  No fiscal implication to the State is anticipated.                    *
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The bill would allow a defense based development authority located in a
municipality with a population of 50,000 or more to own a utility
conveyed by the United States, but would prohibit the authority from
operating the utility.  The authority would be required to convey, for
fair market value, a utility received to the municipality that
established the authority.

Provisions of the bill would allow an authority located in a municipality
with a population of less than 50,000 to own and operate utility
services conveyed by the United States.
  
Local Government Impact
  
Under current state law, no defense base development authority is allowed
to own or operate a utility conveyed by the United States.

If the proposed changes were to be implemented, an authority in a
municipality with a population of less than 50,000 could experience a
positive fiscal impact if the authority were to own and operate a utility
and sell those services to a person who leases real property from the
authority.

Fiscal impact would vary by defense based development authority.
  
  
Source Agencies:   
LBB Staff:         JK, RB, JO, DB