LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
Revision 2
April 26, 2001
TO: Honorable Florence Shapiro, Chair, Senate Committee on
State Affairs
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1458 by Duncan (Relating to the management of state
agency and local government electronic projects,
equipment, and contracts, to the purchase and use of
certain advanced technological equipment, and to the use
of outside personnel by the comptroller.), Committee
Report 1st House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1458, Committee Report 1st House, Substituted: positive impact *
* of $218,310,578 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 Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $80,589,514 *
* 2003 137,721,064 *
* 2004 180,796,000 *
* 2005 181,807,500 *
* 2006 181,830,000 *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Change in *
* Year Revenue Savings/(Cost) Savings/(Cost) Number of State *
* Gain/(Loss) from General from Employees from *
* from General Revenue Fund Telecommunicat- FY 2001 *
* Revenue Fund 0001 ions *
* 0001 Infrastructure *
* Fund *
* 0345 *
* 2002 $129,756,000 $(49,166,486) $(5,000,000) 9.0 *
* 2003 182,436,000 (44,714,936) (5,000,000) 9.0 *
* 2004 182,436,000 (1,640,000) (5,000,000) 12.0 *
* 2005 182,436,000 (628,500) (5,000,000) 12.0 *
* 2006 182,436,000 (606,000) (5,000,000) 12.0 *
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Technology Impact
Technology costs for the Department of Information Resources (DIR) are as
follows:
* FY 2002 $22,500
* FY 2003 $0
* FY 2004 $585,200
* FY 2005 $22,500
* FY 2006 $0
Technology costs for the Comptroller of Public Accounts (CPA) would total
$2,522,000 for the 2002-03 biennium for 300 wireless modem-type devices,
the audit database, hardware and software costs, conversion costs,
license costs, and outside assistance. This includes annual modem and
system maintenance costs totaling $303,250 would begin in FY 2003, and
two additional scanners would need to be purchased in both FY 2005 and
FY 2006.
Fiscal Analysis
The bill would implement AFM5 from the CPA's E-Texas report. To enhance
the efficiency of audits and enforcement activities, the bill would
require the CPA to acquire and maintain wireless communication equipment,
and develop, implement and maintain an advanced audit database system.
(E-Texas: AFM5)
The bill would also fully or partially implement the following
recommendations from the CPA's E-Texas report: EG1, EG3, EG5, EG6, EG10,
CG3, GP4, and HRM2.
The bill would:
* Establish an electronic government Program Management Office (PMO) to
guide, promote and facilitate the implementation of selected electronic
government projects. (E-Texas: EG1)
* Require the PMO, in coordination with Texas Department of Economic
Development, Secretary of State, Texas Natural Resources Conservation
Commission, Texas Department of Transportation, Department of Licensing
and Regulation, the CPA, and other agencies, to develop and implement a
plan for the creation of an electronic government project to provide new
businesses in this state a single source for information and permitting.
(E-Texas: EG3)
* Create a seat management division to conduct a study and make
recommendations. (E-Texas: CG3)
* Require the establishment of the Texas Online grant program enabling
cities, counties and school districts to provide government services
through the Texas Online portal. (E-Texas: EG6)
* Make collaborative community networking initiatives in the state
eligible to receive Telecommunications Infrastructure Fund (TIF) grant
funding, when participating in TIF's Collaborative Community Networking
Grant Program. (E-Texas: EG10)
* Create an online system for listing state agency employment openings
and receiving applications for employment. (E-Texas: HRM2)
* Require examination of state reporting requirements for counties and
municipalities. (E-Texas: GP4)
* Develop functional specifications and make preparations for a
statewide electronic data clearinghouse. (E-Texas: EG5)
Methodology
Regarding the CPA's efficiency of audits and enforcement activities:
* (AFM5) In its estimate regarding efficiency of audits and enforcement
activities, the CPA assumes that it would use the new authority to
contract for audit resources sufficient to allow audit coverage of 1
percent of taxpayers. Including technology costs, administrative costs
for the CPA would total $24,369,000 for the 2002-03 biennium. The CPA
would incur costs of $1,243,000 for each year of the biennium to contract
for a Special Audit Unit, composed of 13 FTE auditors, and $9,392,000
for each year of the biennium for 100 FTE contract auditors. An
additional $288,000 in contract assistance would be necessary each year
of the biennium to support implementation of the new technology. The
projected increase in revenue collections with full implementation is
estimated at $129.7 million for FY 2002, and $182.4 million in each year
thereafter. The $24.4 million cost to implement this program is included
in the Senate version of Senate Bill 1. The Comptroller's office has
indicated that it will increase the 2002-03 revenue estimate by $312.1
million when this program is implemented.
Regarding all other aspects of the bill:
* (EG1) DIR estimates that the PMO would require $928,210 for
professional services in FY 2002 and $956,410 in FY 2003. After FY 2003,
the funding should come from a percentage of each project budget. In
addition, implementation would require an additional six FTEs estimated
to be $500,000, benefits included, annually. The CPA estimates costs to
participating agencies in FY 2004-06 to be $531,000 per year.
* (EG3) According to DIR, the cost for One-stop Service would be
$500,000 for professional services: $150,000 to study the existing
common permitting application and information required by the licensing
and regulation agencies that may require information for someone starting
a new business; and $350,000 for integration into the Texas Online
Portal and development of agency and online web forms.
* (CG3) DIR estimates that creating a seat management division would
cost $668,776 in FY 2002 and require one additional FTE.
* (EG6) The CPA estimates that implementation of the TexasOnline Grant
Program would cost $59,000,000 to General Revenue for the FY 2002-03
biennium. This funding would enable approximately 700 cities, counties,
and school districts in strategic investment areas to provide selected
government services online. Putting the activities of existing grant
programs online would cost $1,800,000 over two years. It would also
require one FTE at a cost of approximately $70,000 a year, including
benefits, and an additional $5,000 a year for operating expenses. The FTE
cost would increase in FY 2004 and again in FY 2006. There would be an
additional $2,500 increase in FY 2006 for computer upgrade.
* (EG10) The bill would direct the Texas Infrastructure Fund (TIF) to
establish a goal of awarding collaborative community network grant and
loan funding of not less than $5 million each year from the Qualifying
Entities Account.
* (HRM2) DIR estimates that creating an online state agency employment
listing and application system would have a development cost to General
Revenue of $1,000,000 in FY 2002.
* (GP4) According to the CPA's E-Texas report and DIR, compiling a list
of ways to streamline and reduce reporting requirements on cities and
counties would require DIR to employ one analyst, at a salary of $68,750,
including benefits, with a budget of $50,000. DIR estimates costs of
$241,526 in FY 2002-03 to conduct the local government reporting study.
* (EG5) The cost of development and implementation of the data
clearinghouse is estimated to be $1,034,000. The total does not include
the cost of staffing the data clearinghouse. In addition to the analyst
added in FY 2002, this estimate assumes that three analysts would be
required beginning in FY 2004.
Local Government Impact
A savings on telecommunications costs would be realized for those local
governments participating in TIF's collaborative community networking
program.
Source Agencies: 313 Department of Information Resources, 304
Comptroller of Public Accounts
LBB Staff: JK, RB, SD, SK