LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
April 23, 2001
TO: Honorable Carlos F. Truan, Chair, Senate Committee on
Veteran Affairs & Military Installations
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1815 by Truan (Relating to establishing a loan program
to assist communities that may be affected by federal
military base closures.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1815, As Introduced: negative impact of $(6,000,000) 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. *
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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(6,000,000) *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Change in *
* Year Savings/(Cost) Savings/(Cost) Revenue Number of State *
* from General from Gain/(Loss) Employees from *
* Revenue Fund Appropriated from FY 2001 *
* 0001 Receipts Appropriated *
* 0666 Receipts *
* 0666 *
* 2002 $(6,000,000) $(78,262) $78,262 1.5 *
* 2003 0 (1,270,862) 1,270,862 1.5 *
* 2004 0 (78,262) 78,262 1.5 *
* 2005 0 (1,270,862) 1,270,862 1.5 *
* 2006 0 (78,262) 78,262 1.5 *
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Fiscal Analysis
The bill amends Sections 486, Government Code to authorize a revolving
loan program to communities potentially affected by defense base
reduction and limits eligibility for the revolving loans from the
program.
According to the Department of Economic Development (TDED), $6 million in
General Revenue would be needed for implementation of the bill. TDED
anticipates that expenses arising from the administration of the bill
would be covered in full by Appropriated Receipts in the form of
interest earnings and fees authorized by rules established to administer
the program. Expenses to administer the program are anticipated to be
$78,262 in FY 2002 and $70, 862 in FY 2003 for a total of $149,124 for
the biennium. Expenses for future years are anticipated to be $72,862 in
FY 2004, $71,262 in FY 2005 and $70,462 in FY 2006. Loan repayments will
be redistributed as new loans throughout the life of the program.
In order to carry out the responsibilities of the program TDED estimates
that at least one and one-half additional FTE s would be required in the
administering agency.
The bill would take effect September 1, 2001.
Methodology
The TDED anticipates that expenses arising from the administration of the
bill would be covered by interest earnings and fees authorized by rules
established to administer the program. It is assumed that the revolving
loan program established by the bill would be financially self-sustaining
after the initial appropriation. Expenses to administer the program are
anticipated to be $6,078,262 in FY 2002 with unexpended balance
authority and $70,862 in FY 2003 for a total of $6,149,124 Expenses for
future years are anticipated to be $72,862 in FY 2004, $71,262 in FY 2005
and $70,462 in FY 2006.
The program established by the bill provides for financing in the form of
a revolving loan to eligible communities. Loans would be provided under
the program to assist in developing infrastructure within eligible
communities. The terms of the loans extended would be provided for
through the rule-making process.
Local Government Impact
Units of local government that qualify for loans under this bill would
experience an increase in revenue that is proportionate to the negative
impact on general revenue funds experienced by TDED.
Source Agencies: 480 Department of Economic Development
LBB Staff: JK, RB, RT, ER, DW