LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 77th Regular Session February 17, 2001 TO: Honorable Florence Shapiro, Chair, Senate Committee on State Affairs FROM: John Keel, Director, Legislative Budget Board IN RE: SB391 by Wentworth (Relating to the automation of the compulsory motor vehicle inspection system.), As Introduced ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Funds for * * SB391, 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 Gain/(Loss) Probable Savings/(Cost) from * * Year from General Revenue Fund General Revenue Fund * * 0001 0001 * * 2002 $18,091,713 $(18,091,713) * * 2003 18,634,465 (18,634,465) * * 2004 19,193,499 (19,193,499) * * 2005 19,769,304 (19,769,304) * * 2006 20,362,382 (20,362,382) * *************************************************************************** Technology Impact The Department of Public Safety (DPS) estimates that implementing the bill would require 1,879 hours of contract programming at $120/hour for a total cost of $225,480. DPS estimates that hardware, software and related costs would total $1,023,183 in fiscal year 2002 and $589,825 in subsequent years. Fiscal Analysis The bill would require the automation of the compulsory motor vehicle inspection program and would authorize DPS to charge an additional $1.25 per inspection to implement the program. The newly authorized fee would be deposited to the credit of a newly-created automated inspection system account, in the General Revenue Fund. The money in the account could be appropriated only to DPS for the development, implementation, and administration of the automated compulsory motor vehicle inspection system. The bill would take effect on September 1, 2001. Methodology In FY 2000, there were 13,642,540 inspection certificates sold by DPS to inspection stations in Texas. Over the past three years, the growth in the sale of inspection certificates has averaged 3 percent annually. Assuming this growth rate continues, the additional $1.25 per certificate that would be authorized by the bill, would generate $18,091,713 in fiscal year 2002 increasing to $20,362,382 by fiscal year 2006. DPS estimates that the start-up costs that include hardware, software and programming would be $1,248,663 in fiscal year 2002 and $589,825 each year thereafter. DPS would contract with a vendor to transmit and capture the data for the automated system. DPS estimates that the vendor charge for this service would be approximately $1.16 per certificate or $16,789,110 in fiscal year 2002. Vendor costs would escalate in subsequent years to approximately $1.20 per certificate or $19,923,581 by fiscal year 2006. In each fiscal year, the combined costs of the vendor and the computer maintenance and replacement would be expected to approximately equal the revenue generated. Local Government Impact No fiscal implication to units of local government is anticipated. Source Agencies: 405 Texas Department of Public Safety, 304 Comptroller of Public Accounts LBB Staff: JK, RB, DG