LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 77th Regular Session March 22, 2001 TO: Honorable Warren Chisum, Chair, House Committee on Environmental Regulation FROM: John Keel, Director, Legislative Budget Board IN RE: HB3420 by Chisum (Relating to the permanent management of low-level radioactive waste.), As Introduced ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Funds for * * HB3420, As Introduced: 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. * ************************************************************************** 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: ************************************************************************** *Fiscal Probable Revenue Probable Change in Number of * * Year Gain/(Loss) from Low Savings/(Cost) from State Employees from * * Level Waste Account/ Low Level Waste FY 2001 * * GR-Dedicated Account/ * * 0088 GR-Dedicated * * 0088 * * 2002 $939,869 $(939,869) 7.0 * * 2003 883,869 (883,869) 7.0 * * 2004 883,869 (883,869) 7.0 * * 2005 883,869 (883,869) 7.0 * * 2006 883,869 (883,869) 7.0 * ************************************************************************** Technology Impact The cost of acquiring personal computers and related equipment for seven new positions ($21,000). Fiscal Analysis The bill gives Texas Natural Resource Conservation Commission (TNRCC) the authority to license a permanent management site for low-level radioactive waste. Permanent management would include disposal or assured isolation with later conversion of the assured facility for on-site disposal of waste. It is estimated that TNRCC would require additional expenses of $939,869 in fiscal year 2002 and $883,869 each fiscal year thereafter and seven additional positions to implement the provisions of the bill. All funding would be provided by fees deposited to GR Account No. 0088, Low-Level Radioactive Waste. Some of the major provisions of the bill that have fiscal implications are described below. The bill requires the permanent management licensee to pay an annual amount, to be determined by the TNRCC, for perpetual maintenance and care of the facility after activities under the license has been terminated. The licensee is eligible for a refund of these payments and the interest earned on these payments that is in excess of the amount required for perpetual care and maintenance. A waste disposal fee would be charged for any radioactive waste delivered to the site. These fees must be sufficient to allow TNRCC and the permanent management license holder to recover operating and maintenance and financial assurance costs, in addition to a reasonable return on investment. In addition, the rates charged for disposal must be sufficient to meet future decommissioning, and perpetual care of the permanent management facility and if applicable the costs of converting an assured isolation facility to a disposal facility. These fees would be deposited to General Revenue Account No. 0088 - Low-Level Radioactive Waste. A new General Revenue Account - Permanent Management Facility Decommissioning would be created to receive that portion of waste disposal fees required for the decommissioning of the facility. TNRCC would be required to review the account balance each biennium, and if a balance is reached that would generate sufficient interest income to decommission the facility within the time frame projected, the Comptroller will no longer direct waste disposal fees into the new account. A new General Revenue Account - Assured Isolation Conversion Account is created to finance the conversion of such a facility to a disposal facility in the event an assured isolation receives the permanent license. Like the GR Account - Permanent Management Facility Decommissioning, TNRCC would be required to review the balance in the Assured Isolation Account each biennium to determine if the balance would generate sufficient interest income to decommission the facility within the time frame projected, and to discontinue directing waste disposal fees into the new account. Finally, the bill would authorizes TNRCC to issue bonds to finance the operation of the permanent management facility in the event that the TNRCC must operate the facility, as well as bonds to reimburse the permanent licensee for the costs of constructing the permanent management facility. Methodology The only cost estimates provided are for TNRCC administrative costs. Because decommissioning and perpetual care costs depend on the type of facility licensed and the annual amounts of waste disposed, no estimate of these costs is included in the fiscal note. Similarly, no costs have been estimated for converting an Assured Isolation facility to a disposal facility, because it would depend on the conversion design submitted in the license application for an assured isolation facility. Local Government Impact The county in which the facility selected for assured isolation or disposal is located would be eligible to receive 10 percent of waste disposal fees for public projects. Source Agencies: 592 State Soil & Water Conservation Board, 580 Texas Water Development Board, 302 Office of the Attorney General, 582 Texas Natural Resource Conservation Commission, 304 Comptroller of Public Accounts LBB Staff: JK, CL, ZS