LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 78TH LEGISLATIVE REGULAR SESSION

April 9, 2003

TO:	Honorable Troy Fraser, Chair, Senate Committee on Business & Commerce
FROM:	John Keel, Director, Legislative Budget Board
IN RE:	SB1803 by Duncan (Relating to licensing food manufacturers, food wholesalers, and warehouse operators under the Texas Food, Drug, and Cosmetic Act.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for SB1803, As Introduced: an impact of $0 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.

Senate Bill 1803 amends several sections of Chapter 431 of the Health and Safety Code to add authority to license warehouse operators who store food, and register food wholesalers who store food in a licensed warehouse. The bill also makes it a prohibited act to operate as a warehouse operator without being licensed, or food wholesaler without being licensed or registered as appropriate.

 

This Act takes effect on September 1, 2003.

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2004	$0
2005	$0
2006	$0
2007	$0
2008	$0

All Funds, Five-Year Impact:

Fiscal Year	Probable Revenue Gain from GENERAL REVENUE FUND 1	Probable (Cost) from GENERAL REVENUE FUND 1
2004	$641,740	($641,740)
2005	$641,740	($641,740)
2006	$641,740	($641,740)
2007	$641,740	($641,740)
2008	$641,740	($641,740)

Fiscal Analysis

The Department of Health states that, although they lack sufficient information to provide an accurate estimate of revenue, they would set fees in amounts sufficient to cover costs.  This fiscal note uses data provided on fiscal year 2002 revenue gained from licensing of food wholesalers.

Methodology

TDH intends for the changes in statute to be revenue neutral.  The change to statute serves to make current practices law.  In fiscal year 2002, there were 3,108 food wholesalers licensed at an average fee of $206.48, for a total of $641,740.  See following example of the probable methodology that will be used to set the fees:

1000 x $206.48 fee = $206,480  Wholesalers not using licensed warehouses (license fee)

2108 x $ 50.00 fee = $105,400  Wholesalers using licensed warehouses (registration fee)

300 x $1099.53 fee = $329,859  Licensed warehouses having an average of 25,000 sq. ft.

Total Revenue = $641,740.

The cost of processing the licenses and registrations will be absorbed with current resources.

Technology

The bill would have no impact on technology.

Local Government Impact

No fiscal implication to units of local government is anticipated.

Source Agencies:	501 Department of Health
LBB Staff:	JK, JRO, KF, MB