LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 11, 2001
TO: Honorable J.E. "Buster" Brown, Chair, Senate Committee on
Natural Resources
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2134 by Chisum (Relating to the regulation of motor
vehicle emissions; providing penalties.), As Engrossed
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2134, As Engrossed: 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 Revenue Probable Change in Number of *
* Year Gain/(Loss) from Savings/(Cost) from State Employees from *
* Clean Air Account/ Clean Air Account/ FY 2001 *
* GR-Dedicated GR-Dedicated *
* 0151 0151 *
* 2002 $3,415,811 $(3,415,811) 3.0 *
* 2003 13,787,811 (13,787,811) 3.0 *
* 2004 17,794,987 (17,794,987) 3.0 *
* 2005 20,084,987 (20,084,987) 3.0 *
* 2006 22,444,987 (22,444,987) 3.0 *
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Technology Impact
The Texas Natural Resource Conservation Commission (TNRCC) would require
computers for additional FTEs required by the bill at a total cost of
$9,000 in fiscal year 2002.
Fiscal Analysis
The bill would create a Low-Income Vehicle Repair Assistance, Retrofit
and Accelerated Vehicle Retirement Program within the Texas Natural
Resource Conservation Commission's (TNRCC's) inspection and maintenance
(I/M) program.
A county would be authorized to participate in the program, but
participation would not be mandatory. The program would be funded with
fees collected from vehicle emissions-related inspections. Revenue
collected from the fee would be distributed back to the counties by the
TNRCC in reasonable proportion to the collections by county or regions in
which those counties are located. Counties would use the funds to
assist low-income individuals with repairs relating to bringing vehicles
into compliance with emissions requirements and replacing vehicles for
which repair would not be cost-effective.
The bill would exempt from emissions testing requirements those counties
with fewer than 70,000 residents.
The TNRCC and the Texas Department of Public Safety (DPS) would establish
incentives for those counties not likely to meet federal clean air
standards to implement the Motor Vehicle Emissions Inspection and
Maintenance Program and the Low-Income Vehicle Repair, Retrofit and
Accelerated Vehicle Retirement Program. A qualified county would be
designated as a "Clean Air County" and would be given preference in any
federal or state clean air grant program.
The bill would create an account in the General Revenue Fund for the
deposit of administrative penalties received by persons violating laws
relating to emissions testing and excessive motor vehicle emissions for
use by the Texas Department of Public Safety.
Methodology
It is expected that all counties currently subject to emissions testing
requirements (Collin, Dallas, Denton, Harris and Tarrant) would
participate in the programs beginning in May 2002. It is expected that
the following other counties in areas in nonattainment for the federal
ozone standard would begin participating in May 2003, based on data from
the TNRCC and the 2000 U.S. Census: Brazoria, Ellis, Fort Bend,
Galveston, Johnson, Kaufman, Montgomery, and Parker.
It is estimated that $3,197,635 in revenues would be generated for the
Low-Income Vehicle Repair Assistance, Retrofit and Accelerated Vehicle
Retirement Program in fiscal year 2002. Revenue generated would increase
to $13,593,635 in fiscal year 2003, the first full year of the program,
and continue to increase through 2006 as additional counties would be
expected to join the program.
It is estimated that the TNRCC would require three additional FTEs to
implement the requirements of the bill. These FTEs would be required to
establish and update program eligibility requirements and repair and
replacement cost limits; manage contracts and grants to counties; and
conducting program accounting and auditing. Administrative costs to the
TNRCC, including employee benefits costs, are estimated at $218,176 in
fiscal year 2002 and $194,176 in fiscal years 2003-2006.
The costs to TNRCC associated with implementing the bill would be covered
by new revenues generated by the vehicle emissions inspections fee.
Although the fee could vary by county, this estimate assumes that an
additional $6 from each automobile registered in each of the
participating counties would be remitted to the State in fiscal years
2002 through 2004. These revenues could be generated either by increasing
the vehicle emissions inspection and maintenance fee, or by maintaining
the current fee but allowing inspection station operators to retain a
smaller portion of the fee. The portion of the fee remitted to the state
could gradually be reduced beginning in 2005 as the demand for program
assistance would decrease.
No significant fiscal implications are anticipated for the Department of
Public Safety to implement the provisions of the bill.
Some state agencies owning or leasing motor vehicles in participating
counties could experience increased costs, if the TNRCC would increase
the vehicle emissions inspections fee to generate the revenues needed for
the Low-Income Vehicle Repair Assistance, Retrofit and Accelerated
Vehicle Retirement Program, but these costs are not expected to be
significant. There also could be some revenue loss to the state if fees
are raised, since some vehicle owners might avoid registering their
vehicles or obtaining inspections due to increased inspection fee costs;
however, such a revenue loss is not expected to be significant.
The amount of revenue expected to be deposited into the new general
revenue account created by the bill for administrative penalties
associated with vehicle emissions is not expected to be significant.
Local Government Impact
Counties participating in the program would receive proceeds of the
program funding in proportion to the amount of fees collected in each
county, with up to 5 percent of the amount each county receiving being
available to be used for administration of the programs. Participating
counties are expected to receive grants totaling $3.2 million in 2002,
increasing to $22.2 million by 2006. It is expected that 95 percent of
these amounts would be used to provide assistance to individuals, with
the remaining 5 percent used to cover counties' administrative costs. The
amount each participating county would receive would depend on the
vehicle emissions inspection fee revenues generated in that county and
the number of vehicles inspected.
Local governments owning or leasing motor vehicles in participating
counties could experience increased costs if the vehicle emissions
inspection and maintenance fee is increased, but these costs are not
expected to be significant.
Counties participating in the program could experience some revenue
losses, while counties not participating in the program could experience
some revenue gains, since some vehicle owners might register their
vehicles in non-participating counties to avoid inspection fee costs, if
fees are increased to generate revenues for the program. However, the
changes in revenues resulting from such situations are not expected to
be significant.
Source Agencies: 582 Texas Natural Resource Conservation Commission
LBB Staff: JK, CL, TL