LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 78TH LEGISLATIVE REGULAR SESSION
 
May 20, 2003

TO:
Honorable Teel Bivins, Chair, Senate Committee on Finance
 
FROM:
John Keel, Director, Legislative Budget Board
 
IN RE:
HB2425 by McCall (Relating to state and certain local fiscal matters; making an appropriation.), As Engrossed



Estimated Two-year Net Impact to General Revenue Related Funds for HB2425, As Engrossed: a positive impact of $14,188,000 through the biennium ending August 31, 2005.

The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.



Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2004 $4,787,000
2005 $9,401,000
2006 $23,991,000
2007 $26,685,000
2008 $31,709,000




Fiscal Year Probable Revenue Gain/(Loss) from
GENERAL REVENUE FUND
1
Probable Savings/(Cost) from
GENERAL REVENUE FUND
1
Probable Revenue Gain/(Loss) from
AVAILABLE SCHOOL FUND
2
Probable Revenue Gain/(Loss) from
FOUNDATION SCHOOL FUND
193
2004 $7,342,000 ($6,805,000) $2,292,000 $1,958,000
2005 $13,905,000 ($11,004,000) $3,000,000 $3,500,000
2006 $17,047,000 ($656,000) $3,600,000 $4,000,000
2007 $18,968,000 ($796,000) $3,763,000 $4,750,000
2008 $22,383,000 ($889,000) $4,215,000 $6,000,000

Fiscal Year Probable Revenue Gain/(Loss) from
STATE HIGHWAY FUND
6
Probable Savings/(Cost) from
STATE HIGHWAY FUND
6
Probable Revenue Gain/(Loss) from
Economic Stabilization Fund 599
Probable (Cost) from
Other Funds
2004 $6,876,000 ($249,000) $0 ($201,000)
2005 $9,000,000 ($264,000) $6,028,000 ($214,000)
2006 $10,080,000 ($279,000) $10,981,000 ($226,000)
2007 $11,289,000 ($296,000) $573,000 ($240,000)
2008 $12,645,000 ($314,000) $593,000 ($254,000)

Fiscal Year Probable Revenue Gain/(Loss) from
Cities
Probable Revenue Gain/(Loss) from
Transit Authorities
Probable Revenue Gain/(Loss) from
Counties and Special District
2004 $264,000 $97,000 $34,000
2005 $703,000 $258,000 $90,000
2006 $908,000 $333,000 $116,000
2007 $943,000 $311,000 $109,000
2008 $789,000 $289,000 $101,000

Fiscal Analysis

The bill would amend various provision of current law relating to state fiscal matters.

 

Revenue gains and losses result from the following:

        Losses from a sales tax exemption for pharmaceutical biotechnology cleanrooms and equipment;

        Gains from other sales tax provisions;

        Gains from natural gas tax provisions related to high-cost gas, the treatment of cash sales and marketing costs; and

        Gains from motor fuels tax treatment of power take-off equipment;

 

 Cost and savings result from the following:

        Savings from a provision related to interest paid under the prompt payment law;

        Costs from a provision related to vacation carry-forward for state employees; and

        The cost of an increase in the transfer to the Economic Stabilization Fund offsetting a portion of the revenue gain from a provision relating to natural gas tax.

 

The bill would repeal the statutory cap on borrowing related to temporary cash flow shortages in the general revenue fund. Currently the limit is twenty-five percent of revenues credited to the general revenue fund for the fiscal year.  The bill would allow the Cash Management Committee to set the limit.

 

The bill would authorize the Comptroller to borrow certain funds managed by or in the custody of the Comptroller, including funds held outside the state treasury. The borrowing would be done in order to prevent temporary cash flow deficiencies in the general revenue fund. The bill would appropriate to the Comptroller from the general revenue fund amounts necessary to return the transferred cash and maintain the equity of funds from which transfers are made.

 

The bill would authorize the Comptroller to do performance audits of school districts and institutions of higher education without a request from the governing body of the school or institution. 

 

The bill would provide insurance tax credits for certified capital companies, resulting in an aggregate revenue loss of $200,000,000 in general revenue related funds over the period 2009-2012.


Methodology

The estimates were provided by the Comptroller of Public Accounts.  These estimates were adjusted to reflect the change in Economic Stabilization Fund transfers. Set-asides for additional natural gas tax revenue resulting from the bill take place in the fiscal year prior to the transfer to the Economic Stabilization Fund.  The Economic Stabilization Fund estimate includes interest gains.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.

 

It is possible that some of the money borrowed from outside the treasury under the Comptroller's expanded authority would be local government revenue such as local government sales tax revenue. The bill appropriates general revenue to repay the borrowing in fiscal year 2003 and fiscal years 2004 and 2005. After fiscal 2005, the impact on local governments would depend on legislative appropriations to repay any amounts borrowed from local governments funds held by the Comptroller.

 

The bill authorizes school districts to also contract for and implement the energy performance measures contained in the bill.  Any costs to school districts could possibly be offset by savings from reduced energy consumption.  



Source Agencies:
304 Comptroller of Public Accounts, 212 Office of Court Administration, Texas Judicial Council, 301 Office of the Governor, 327 Employees Retirement System, 696 Department of Criminal Justice, 701 Central Education Agency, 781 Higher Education Coordinating Board
LBB Staff:
JK, JO, SD, WP, RS