LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
April 17, 2001
TO: Honorable Kim Brimer, Chair, House Committee on Business
& Industry
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB3199 by Brimer (Relating to certain personal property
that is presumed abandoned.), Committee Report 1st House,
Substituted
**************************************************************************
* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB3199, Committee Report 1st House, Substituted: negative impact *
* of $(130,000) 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 Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $0 *
* 2003 (130,000) *
* 2004 (130,000) *
* 2005 (5,461,000) *
* 2006 (5,461,000) *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Savings/(Cost) from *
* General Revenue Fund *
* 0001 *
* 2002 $0 *
* 2003 (130,000) *
* 2004 (130,000) *
* 2005 (5,461,000) *
* 2006 (5,461,000) *
*****************************************************
Fiscal Analysis
Committee Substitute for House Bill 3199 would amend Chapter 72 of the
Property Code relating to certain personal property that is presumed
abandoned. Under provisions of the bill, money orders would be presumed
abandoned if unclaimed seven years after the issuance date.
The bill would allow holders of abandoned money orders to deduct from the
original value of the money orders for service charges or other changes
incurred, for purposes of determining the value of abandoned money orders
that must be remitted to the Comptroller's Office. Such charges could
not exceed $0.50 per month for each month the money order remained
uncashed before the month in which the money order was presumed
abandoned.
The section of the bill concerning presumption of abandonment if
unclaimed seven years after the issue date would take effect on June 1,
2004 and would apply to money orders presumed abandoned on or after the
effective date of the section.
The section of the bill concerning the deduction of service charges would
take effect June 1, 2002.
Methodology
According to the Comptroller's office, under current law money orders are
presumed abandoned after five years and service charges and other
charges may not be deducted from the original value of a money order for
purposes of determining the value of abandoned money orders that must be
remitted to the Comptroller's Office. Money orders that are presumed
abandoned on June 30 must be remitted to the Comptroller's office no
later than the following November 1.
According to the Comptroller's office, the bill would reduce the
remittance of unclaimed property from holders of abandoned money orders
for fiscal 2005 and 2006. The loss would occur from money orders that
would have been reported as abandoned and remitted to the Comptroller in
fiscal 2005 and 2006. Under this bill, the money orders would not be
considered abandoned for an additional two years. The Comptroller's
office assumes estimated loss by analyzing historical data on abandoned
money orders reported and remitted to the state during the last three
fiscal years. This amount was adjusted for estimated valid claims to be
paid on abandoned money orders to be reported and delivered.
According to the Comptroller's office, this bill would create additional
losses in fiscal 2003 and beyond by allowing service charges and other
charges to be deducted from the original value of money orders. The
Comptroller's estimated loss was determined by multiplying the average
annual number of abandoned money orders reported and remitted to the
state during the last three fiscal years by an estimated service fee of
$30.00 ($0.50 per month for five years) for fiscal years 2003 and 2004.
This amount was adjusted for estimated valid claims to be paid on
abandoned money orders to be reported and delivered. The loss for 2005
and beyond was computed by the Comptroller's office using an estimated
service fee of $42.00 ($0.50 per month for seven years). According to the
Comptroller's office, the actual loss from service charges and other
charges could vary and would depend on the total charges assessed by the
holders.
The Comptroller's office estimates fiscal implications after 2006 to be
approximately $200,000 per year for service fee deductions.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 304 Comptroller of Public Accounts
LBB Staff: JK, JO, JC