LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 26, 2001
TO: Honorable Bill Ratliff, Lieutenant Governor
Honorable James E. "Pete" Laney, Speaker of the House
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2912 by Bosse (Relating to the continuation and
functions of the Texas Natural Resource Conservation
Commission; providing penalties.), Conference Committee
Report
**************************************************************************
* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2912, Conference Committee Report: positive impact of *
* $2,975,436 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. *
**************************************************************************
General Revenue-Related Funds, Five-Year Net Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $1,594,236 *
* 2003 1,381,200 *
* 2004 1,439,321 *
* 2005 1,504,321 *
* 2006 605,321 *
****************************************************
All Funds, Five-Year Impact:
***********************************************************************
*Fiscal Probable Probable Probable Probable Change in *
* Year Revenue Savings/ Revenue Savings/ Number of *
* Gain/(Loss) (Cost) from Gain/(Loss) (Cost) from State *
* from General from New New General Employees *
* General Revenue General Revenue from FY 2001 *
* Revenue Fund Revenue Dedicated- *
* Fund 0001 Dedicated- Environmen- *
* 0001 Environmen- tal Testing *
* tal Testing Laboratory *
* Laboratory Accreditat- *
* Accreditat- ion Account *
* ion Account *
* 2002 $2,642,941 $149,105 $(149,105) 19.0 *
* $(1,048,705) *
* 2003 2,177,000 (795,800) 410,398 (410,398) 24.0 *
* 2004 1,804,000 (364,679) 687,726 (687,726) 23.0 *
* 2005 1,869,000 (364,679) 687,726 (687,726) 15.0 *
* 2006 970,000 (364,679) 687,726 (687,726) 8.0 *
***********************************************************************
***************************************************************************
*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Revenue Savings/(Cost) Savings/(Cost) *
* from Clean Air Gain/(Loss) from Waste from Hazardous *
* Account/ from Waste Management and Solid Waste *
* GR-Dedicated Management Account/ Remediation Fee *
* 0151 Account/ GR-Dedicated Account/ *
* GR-Dedicated 0549 GR-Dedicated *
* 0549 0550 *
* 2002 $(349,753) $125,000 $(285,633) $(123,190) *
* 2003 (329,273) 125,000 (249,222) (122,497) *
* 2004 (247,639) 125,000 (210,869) (85,900) *
* 2005 (247,639) 125,000 (210,869) (85,900) *
* 2006 (247,639) 125,000 (210,869) (85,900) *
***************************************************************************
**************************************************************************
*Fiscal Probable Revenue Probable Probable *
* Year Gain/(Loss) from Savings/(Cost) from Savings/(Cost) from *
* Petroleum Storage Petroleum Storage State Highway Fund *
* Tank Remediation Tank Remediation 0006 *
* Account/ Account/ *
* GR-Dedicated GR-Dedicated *
* 0655 0655 *
* 2002 $94,544,000 $(94,544,000) $(2,750,000) *
* 2003 106,659,000 (82,894,178) (2,750,000) *
* 2004 83,387,000 (88,387,000) (2,750,000) *
* 2005 91,592,000 (77,262,661) (2,750,000) *
* 2006 47,525,000 (57,401,860) (2,750,000) *
**************************************************************************
Technology Impact
The bill would require acquisition of personal computers and related
software and equipment for twenty-four additional employees.
Fiscal Analysis
Statutory modifications with fiscal implications include:
Creates an incentive and performance based regulatory system to be
phased in over a period of three years. This system would distinguish
regulatory tiers based upon levels of compliance with environmental
regulation.
Requires TNRCC to assess a fee between $1,000 to $5,000 prior to the
land application of sewer sludge.
Implements an environmental laboratory accreditation program, and
transfers the Safe Drinking Water Laboratory Assessment Program from the
Texas Department of Health to consolidate it with the new accreditation
program at TNRCC.
Improves revenue management and fee collection practices by requiring
all fees to be paid on the date due, and limits adjustments to
self-reported fee data and fee amounts.
Provides for general transferability of appropriations and funds from
fees in an amount up to the lesser of 7 percent or $20.0 million in
appropriations.
Changes the waste treatment inspection fee into a water quality fee
that would be imposed on wastewater discharge and water rights permit
holders, and combine the waste treatment inspection and water quality
assessment fees into one water quality fee. The fee provisions would
result in an increase in water quality fee of $10,000 per permit holder.
Imposes certain requirements on location of concrete crushing
facilities, and exempts existing facilities from these requirements.
Reinstates the petroleum product delivery fee, but specifies a
declining fee schedule, and extends the reimbursement program for clean
up and remediation of petroleum storage tanks from September 1, 2003 to
September 1, 2006. Increases the water quality fee by $10,000 per permit
holder.
Methodology
Total costs to TNRCC of implementing the bill are estimated to be $181.3
million during the 2002-03 biennium. The bill also would require an
additional nineteen FTEs in fiscal year 2002 and twenty-four additional
FTEs in 2003. The majority of the biennial cost is due to the PSTR
program, which is estimated to cost $177.4 million during the 2002-03
biennium. Expenditure requirements reflected in previous cost estimates
for this bill include: two additional positions and related operating
costs totaling $105,850 per year to implement after-hours response
policy; an additional engineer and related operating and capital costs
are needed to perform emission assessments for emissions upsets totaling
$56,019 per year; two permitting specialists and related operating and
capital costs for the sewer sludge permitting program totaling $120,843
per year; eight (8) additional positions and operating costs for the
performance-based regulatory program are estimated to cost $942,791 in
fiscal year 2002, $926,791 in fiscal year 2003 and $618,291 in fiscal
year 2004 and thereafter; and, $519,860 in fiscal year 2002 and $554,621
in fiscal year 2003 and thereafter for the environmental laboratory
accreditation program.
Although the cost of the environmental laboratory program is expected to
be paid from fees, all costs for the first 18 months of the program would
require General Revenue appropriations, until revenue collections are
sufficient to fund operating costs. It is expected to take TNRCC 18
months to obtain approval from national accreditation authorities to
administer the laboratory accreditation program. It is assumed that all
costs associated with the bill's requirements relating to compliance
history data and performance assessments for incentive-based and
innovative programs would be funded by TNRCC's multiple funding sources.
These costs were distributed among the four largest General
Revenue-Dedicated accounts based on the percentage each account
represented of the TNRCC budget in the 2002-03 appropriations bill as
introduced. One additional adjustment was made: funding that otherwise
would have come from the Water Resource Management Account No. 153 was
provided by the General Revenue Fund. All other program costs, e.g.,
PSTR, emission assessment and sewer sludge permitting program, are funded
by program-related fees.
This bill will generate additional revenue for the General Revenue Fund.
A one-time revenue gain of $712,941 in fiscal year 2002 is estimated due
to increased late fees and penalties from tougher revenue management
practices. Also, the 2 percent service charge authorized by the Water
Code to reimburse the Comptroller for administrative costs related to the
PSTR program is expected to generate an average annual revenue gain to
the General Revenue Fund of $1,750,000 between fiscal years 2002 and
2006.
The bill prohibits concrete crushing facilities from being located within
440 yards of residence, church or school. This prohibition does not
apply to existing rock crushing facilities. It is anticipated that this
provision of the bill will cause an increase of $2.8 million per fiscal
year in costs to the Texas Department of Transportation (TxDOT) due to
travel costs between project sites and rock crushing equipment.
Local Government Impact
Local units of government that own or operate petroleum storage tanks
that are located in aquifers in Bexar and Comal counties may incur costs
to comply with provisions of the bill relating to containment systems for
their storage tanks. Additional costs are estimated to range between
$4,900 to $7,700 per tank, depending on the type of containment system
used.
Local units of government holding water quality permits could experience
cost increases up to $10,000 per year, depending on the rate the TNRCC
would set for the water quality permit fee.
Local governments applying for permits to dispose of "Class B sludge"
will experience increased costs ranging from $1,000 to $5,000 depending
upon the amount of sludge applied to the land application unit.
Provisions of the bill relating to the location of rock crushing
facilities may affect local units of government in Harris County.
However, because of changes in distance requirements and limiting the
location restriction to new concrete crushing facilities, the fiscal
impact should be less significant than the previously anticipated impact
of $5 per cubic yard of concrete mix, and $5 per ton of hot mix.
Source Agencies: 116 Sunset Advisory Commission, 304 Comptroller
of Public Accounts, 582 Texas Natural Resource
Conservation Commission
LBB Staff: JK, CL, ZS