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: SB312 by Zaffirini (Relating to the review and functions
of the Texas Water Development Board.), Conference
Committee Report
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB312, Conference Committee Report: negative impact of *
* $(13,798,580) 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 Net Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(6,165,274) *
* 2003 (7,633,306) *
* 2004 (7,821,172) *
* 2005 (7,820,672) *
* 2006 (7,824,672) *
****************************************************
All Funds, Five-Year Impact:
***********************************************************************
*Fiscal Probable Probable Probable Probable Change in *
* Year Revenue Savings/ Savings/ Revenue Number of *
* Gain/(Loss) (Cost) from (Cost) from Gain/(Loss) State *
* from General Other Funds from Employees *
* General Revenue 0997 Appropriat- from FY 2001 *
* Revenue Fund ed Receipts *
* Fund 0001 0666 *
* 0001 *
* 2002 $(274,000) $25,000 1.0 *
* $(4,297,000)$(1,868,274) *
* 2003 (4,688,000) (2,945,306) (274,000) 25,000 1.0 *
* 2004 (4,688,000) (3,133,172) (274,000) 25,000 1.0 *
* 2005 (4,688,000) (3,132,672) (274,000) 25,000 1.0 *
* 2006 (4,688,000) (3,136,672) (274,000) 25,000 1.0 *
***********************************************************************
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*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Revenue Revenue Revenue *
* from Gain/(Loss) Gain/(Loss) Gain/(Loss) *
* Appropriated from Cities from Transit from Counties *
* Receipts Authorities *
* 0666 *
* 2002 $(25,000) $(706,000) $(273,000) $(83,000) *
* 2003 (25,000) (847,000) (327,000) (100,000) *
* 2004 (25,000) (847,000) (327,000) (100,000) *
* 2005 (25,000) (847,000) (327,000) (100,000) *
* 2006 (25,000) (847,000) (327,000) (100,000) *
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Technology Impact
The bill would require the cost of providing an additional FTE with a
personal computer that is estimated at $1,800 in fiscal year 2002. This
cost would be paid using Texas Water Resources Finance Authority (TWRFA)
proceeds.
It is estimated that $25,000 in additional appropriated receipts per year
will be spent on upgrades to the Texas Natural Resource Information
System (TNRIS), including faster Internet connections and hardware
upgrades. These funds will be recovered through fees charged to private
entities to establish partnerships with the Texas Water Development
Board (TWDB) and TNRIS.
Fiscal Analysis
The bill would require the TWDB to develop a capital spending plan
identifying water needs of the state and setting forth a basis for
allocating state-supported funding to address those needs. The bill would
provide to the TWDB the authority to make grants from the Water
Assistance Fund No. 480 on specific appropriations by the Legislature.
The bill would establish a separate account in the clean water revolving
fund to be used to provide financial assistance to private entities for
nonpoint source pollution control and abatement policies. The bill would
add to the list of hydrographic survey types the agency authorized to
perform those conducted to collect information relating to water-bearing
formations. Fees collected would be deposited to the Hydrographic Survey
Account within the Water Assistance Fund.
The bill would create The Rural Community Water and Wastewater Loan
(RCWWL) Fund within the Water Assistance Fund No. 480. The RCWWL Fund
would consist of money transferred by the Board from the water assistance
fund, from proceeds of the sale of political subdivision bonds by the
Board to the TWRFA and from repayments on loans made from the fund. The
Fund would be used to make loans to rural communities for the
construction, acquisition or improvement of water and wastewater
projects.
The bill would allow the TWDB to enter into partnerships with private
entities on behalf of the TNRIS and allow the agency to collect fees for
such arrangements.
The bill would authorize the Board to use the Agricultural Water
Conservation Bond Fund Program to make loans and grants to political
subdivisions or state agencies for water conservation projects.
The bill would create the colonia self-help account in the general
revenue fund consisting of legislative appropriations, money transferred
to the account by the TWDB, gifts, grants, donations and interest. Funds
in the account would be used to reimburse nonprofit organizations for
expenses incurred in self-help projects resulting in the provision of
adequate water or wastewater services to a colonia.
The bill would exempt from sales and use tax certain equipment relating
to rainwater harvesting, desalination, brush control, precipitation
enhancement, and other items relating to water and wastewater systems.
The bill also would provide authority to taxing units to exempt from
taxation part or all of the assessed value of property on which approved
desalination or brush control projects have been implemented.
Methodology
There could be some administrative costs associated with the bill's
requirement that a Capital Spending Plan be developed. However, it is
anticipated that these costs could be absorbed within the agency's
existing budget.
This estimate assumes that $1.9 million in grants would be made from the
Water Assistance Fund in fiscal year 2002 as a result of General Revenue
appropriations by the Legislature.
There would be no significant fiscal impact expected from the bill's
requirement that a separate account be established in the clean water
revolving fund to be used to provide financial assistance to private
entities for nonpoint source pollution control and abatement policies.
There would also be no significant impact resulting from the bill's
provisions regarding hydrographic surveys.
Assuming that only amounts in the TWRFA account would be available to
fund loans from the RCWWL Fund, it is estimated that of the total
$1,370,000 remaining in TWRFA, $900,000 in loans would be made from the
Fund during fiscal years 2002 through 2005, with an average $180,000 per
year. It is estimated that 5 to 6 loans would be made to rural
communities over that period, and that the TWDB would require one
additional FTE to administer the loan program. Costs associated with this
program, including those associated with salaries, wages, equipment and
travel that are estimated at $94,000 per year and would be paid using
TWRFA proceeds, which are outside the state treasury.
It is estimated that the TWDB would charge fees totaling $25,000 per year
for the establishment of partnerships with private entities on behalf of
the TNRIS system. It is expected that all of these proceeds would be
spent to improve the TNRIS system's accessibility to the Internet.
Although the bill does not specify an amount of bonds to be issued out of
the Agricultural Water Conservation Bond Fund Program, this estimate
assumes that $16 million in bonds would be issued in fiscal year 2003 for
grants to state agencies for water conservation projects. It is assumed
that these bonds would be repaid over seven years, and that general
revenue would be used for the debt service at a cost of approximately $3
million per year.
There could be some administrative costs to the TWDB in administering the
colonia self-help account created by the bill. Assuming no funds would
be appropriated by the Legislature to the Colonia Self-Help Account,
administrative costs to the board are not expected to be significant.
The bill's sales and use tax exemption provisions are estimated by the
Comptroller of Public Accounts to result in losses to the General
Revenue Fund of $4.3 million in fiscal year 2002 and $4.7 million in
fiscal years 2003 through 2006.
Local Government Impact
The estimated loss of revenues to local governments statewide as a result
of the bill's sales and use tax exemption provisions is presented in the
table above. Local governments choosing to exempt from property taxation
property used for desalination and brush control initiatives would be
expected to experience losses in property tax revenues, depending on the
number of such projects in a jurisdiction and the portion of property
associated with such projects that a jurisdiction would exempt from
taxation.
Source Agencies: 304 Comptroller of Public Accounts, 580 Texas
Water Development Board, 116 Sunset Advisory
Commission
LBB Staff: JK, CL, MF, TL