Austin, Texas
                    FISCAL NOTE, 77th Regular Session
                              April 11, 2001
          TO:  Honorable Rodney Ellis, Chair, Senate Committee on Finance
        FROM:  John Keel, Director, Legislative Budget Board
       IN RE:  SB1652  by Bernsen (Relating to the funding and operation
               of certain emergency management and disaster relief
               programs.), As Introduced
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  SB1652, As Introduced:  negative impact of $(18,853,632) 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 Net Impact:
          *  Fiscal Year  Probable Net Positive/(Negative)   *
          *               Impact to General Revenue Related  *
          *                             Funds                *
          *       2002                         $(8,854,862)  *
          *       2003                          (9,998,770)  *
          *       2004                          (9,787,770)  *
          *       2005                          (9,570,770)  *
          *       2006                          (9,345,770)  *
All Funds, Five-Year Impact:
*Fiscal    Probable    Probable    Probable    Probable   Change in    *
* Year     Savings/    Savings/    Revenue     Savings/   Number of    *
*        (Cost) from (Cost) from Gain/(Loss) (Cost) from    State      *
*          General     Disaster      from      Disaster   Employees    *
*          Revenue   Contingency  assessment  Management from FY 2001  *
*            Fund      Account/  to Disaster Fund in the               *
*            0001        GR-      Management    Texas                  *
*                     Dedicated  Fund in the   Treasury                *
*                        0453       Texas    Safekeeping               *
*                                  Treasury     Trust                  *
*                                Safekeeping   Company                 *
*                                   Trust                              *
*                                  Company                             *
*  2002                            $5,556,000                    16.0  *
*        $(8,854,862)$(2,480,455)            $(5,556,000)              *
*  2003   (9,998,770)           0   6,722,000 (6,722,000)        16.0  *
*  2004   (9,787,770)           0   6,933,000 (6,933,000)        16.0  *
*  2005   (9,570,770)           0   7,150,000 (7,150,000)        16.0  *
*  2006   (9,345,770)           0   7,375,000 (7,375,000)        16.0  *
Technology Impact
Technology impact would be limited to microcomputers, related equipment
and software.  The cost of these additional items is estimated to be
Fiscal Analysis
The bill would establish a Disaster Management Fund to provide disaster
assistance to victims and political subdivisions when there is no
Presidential disaster declaration or a Presidential declaration does not
address certain categories of assistance.  The Disaster Management Fund
would be a trust fund in the Texas Treasury Safekeeping Trust Company.
The fund would be used to pay the administrative expenses of the
Emergency Management Service (EMS) within the Department of Public Safety
for expenses related to emergency management training for state agencies
and political subdivisions, expenses incurred in implementation of
statewide mutual aid assistance, and expenses for implementation of a
statewide notification system.

The bill would abolish General Revenue-Dedicated Account No. 453,
Disaster Contingency and transfer any unexpended balance in the account
to the new trust fund.  The bill would authorize a new utility assessment
for emergency management and disaster relief equal to one-thirteenth of
1 percent of the gross receipts of the rates charged to consumers in the
state.  The Comptroller would collect and deposit the assessment,
including any fees, penalty or interest to the Disaster Management Fund.
In addition, the legislature could make appropriations to the Fund.

The bill would take effect immediately if it receives a vote of
two-thirds of all the members elected to each house, otherwise it would
take effect September 1, 2001.
The Division of Emergency Management (EMS) estimates that the
implementation of the bill would have the following costs to the state:
a) debris removal, repair or replacement of highways or streets, and
water control structures would cost the state $6,525,785 annually b)
assistance to individuals and households would cost $1,419,431 annually
c) post-disaster mitigation would cost $1,589,043 annually d) the state
and local government training program authorized would cost $2,078,000
annually e) the implementation of a statewide notification system would
cost $800,000 annually f) a 50 percent cost share with cities and
counties for cost incurred on public assistance projects eligible for
federal disaster assistance would cost $2,117,413 annually g) crisis
counseling and competitive grants would cost $464,500 annually.

It is estimated that implementing the provisions of this bill would
require 16 additional positions in the Division of Emergency Management
of the Department of Public Safety to administer the funds and provide
the aid and training specified.  Two Program Administrators, one Planner,
one Emergency Technician, two Administrative Technicians I, two
Accounting Clerks IV, one Auditor, and two Administrative Technicians II
would be responsible for the administrative responsibilities of the bill.
Five Program Specialists II would be stationed in the field and provide
mutual aid assistance and emergency management training.

The annual salary expense for the new positions would be $365,444 with
associated benefit costs of $103,347.  Ongoing costs related to travel,
rent and operating costs total $257,807 annually.  One-time costs for
equipment and technology purchases in the first year total $170,547.  On
a recurring basis, the cost to EMS of implementing the provisions of this
bill is $726,598.

The Comptroller's Office assumes that the proposed assessment would apply
to retail electric providers, electric cooperatives and
municipally-owned electric utilities.  Using this assumption, the
assessment would generate approximately $6,722,000 in fiscal year 2003
and grow by 3 percent in each fiscal year remaining in the five year
forecast period.  The remaining amounts needed to fund projected expenses
would come from the General Revenue Fund, and during the first year, a
transfer from the unexpended balance in the Disaster Contingency Account,
which is abolished by this legislation.

Although the Comptroller's Office reports no balance in the General
Revenue-Dedicated Disaster Contingency Account No. 453, the Governor's
Office reports a balance of $2,480,455 as of February 2001.  For
purposes of this analysis, it is assumed that this balance is
transferred to the new Disaster Management Account on September 1, 2001.
Local Government Impact
The bill would authorize reimbursements to local jurisdictions for
eligible damages due to disasters not declared by the President where a
Presidential declaration does not cover certain areas of assistance.
The majority of the amounts available would be passed through to local
governmental entities or citizens.
Source Agencies:   301   Office of the Governor, 473   Public Utility
                   Commission of Texas, 475   Office of Public Utility
                   Counsel, 576   Texas Forest Service, 405   Texas
                   Department of Public Safety, 304   Comptroller of
                   Public Accounts
LBB Staff:         JK, SD, MF, ZS