LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 26, 2001
TO: Honorable J.E. "Buster" Brown, Chair, Senate Committee on
Natural Resources
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1751 by Haywood (Relating to the Texas Energy Resource
Council.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1751, As Introduced: positive impact of $14,334,000 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 $16,115,000 *
* 2003 (1,781,000) *
* 2004 (1,828,000) *
* 2005 (1,346,000) *
* 2006 (1,074,000) *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Revenue Gain/(Loss) from *
* New General Revenue Related - *
* Energy Resource Fund *
* 2002 $16,115,000 *
* 2003 (1,781,000) *
* 2004 (1,828,000) *
* 2005 (1,346,000) *
* 2006 (1,074,000) *
*****************************************************
Fiscal Analysis
The bill would create the Texas Energy Resource Council and a General
Revenue Account named the Energy Resource Fund. The purpose of the
council would be to promote environmentally sound production, support
educational activities, job training and research and educate the public
on the importance of the oil, natural gas and pipeline industry.
The energy resource fund would be created as a special fund in general
revenue. The new account would consist of gifts, grants, funds
appropriated by the Legislature, and an assessment of 0.1 percent of
gross revenues received at the wellhead on oil, natural gas, and
condensate produced in the state. Chapters 201 and 202 of the Tax Code
would apply to the administration and collection of the assessment. The
Comptroller would retain an amount of revenue approximately equal to that
necessary to administer the account. The council would be responsible
for collection of any unpaid assessments, and the Comptroller would be
responsible for reporting any unpaid assessments to the council.
A person subject to the assessment would be authorized to file for a
refund of the previous year's assessment. The refund would include
interest earned at the rate equal to average United States Treasury
Bill. The refund would have to be filed within the first three months
following the calendar year for which the refund was requested.
Methodology
According to the Comptroller's Office, the fiscal impact was estimated
using core production data that were used to estimate severance tax
revenues for the 2002-2003 Biennial Revenue Estimate.
The bill would allow for the previous year's assessment to be refunded,
provided that certain requirements were met. According to the
Comptroller's Office, because gross revenues received at the wellhead
are projected to decline, the refunds in each year following the first
year of implementation would exceed collections, thereby generating
losses each year. A calculated amount of interest would also be
refunded, though no interest earned would be deposited into the account.
The Comptroller's Office assumed for purposes of the fiscal note that
all amounts available would be claimed and refunded.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 455 Railroad Commission of Texas, 304 Comptroller
of Public Accounts
LBB Staff: JK, CL, SK