LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              March 26, 2001
  
  
          TO:  Honorable Warren Chisum, Chair, House Committee on
               Environmental Regulation
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB2820  by Swinford (Relating to a prohibition on the
               sale of gasoline containing methyl tertiary butyl ether
               and a requirement for the substitution of gasoline
               containing ethyl tertiary butyl ether or ethanol for use
               in certain nonattainment areas.), As Introduced
  
**************************************************************************
*  No significant fiscal implication to the State is anticipated.        *
**************************************************************************
  
The bill would prohibit the sale of gasoline containing MTBE after
September 1, 2003 and in addition, requires that ethanol be used as the
oxygenate in reformulated gasoline in nonattainment areas after
September 1, 2003. The bill could result in additional fuel costs for
state agencies with fleets of 20 vehicles or more in nonattainment
areas.  However, it is anticipated that impacted agencies will be able
to absorb any increases in fuel costs resulting from this legislation
within existing resources.
  
Local Government Impact
  
Removing MTBE from the market place and requiring ethanol to be used in
reformulated gasoline in nonattainment areas could result in fuel price
increases for local governments in nonattainment areas.  However, no
significant fiscal implication to units of local government is
anticipated.
  
  
Source Agencies:   582   Texas Natural Resource Conservation Commission,
                   601   Texas Department of Transportation, 303
                   General Services Commission, 304   Comptroller of
                   Public Accounts
LBB Staff:         JK, CL, ZS, TL