TO: | Honorable Burt R. Solomons, Chair, House Committee on Financial Institutions |
FROM: | John S. O'Brien, Deputy Director, Legislative Budget Board |
IN RE: | HB398 by Villarreal ( relating to the regulation of tax refund anticipation loans; imposing an administrative penalty.), Committee Report 1st House, Substituted |
Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
---|---|
2006 | $0 |
2007 | $0 |
2008 | $0 |
2009 | $0 |
2010 | $0 |
Fiscal Year | Probable Revenue Gain/(Loss) from GENERAL REVENUE FUND 1 |
Probable Savings/(Cost) from GENERAL REVENUE FUND 1 |
Change in Number of State Employees from FY 2005 |
---|---|---|---|
2006 | $306,475 | ($306,475) | 4.0 |
2007 | $332,212 | ($332,212) | 6.0 |
2008 | $332,212 | ($332,212) | 6.0 |
2009 | $332,212 | ($332,212) | 6.0 |
2010 | $347,212 | ($347,212) | 6.0 |
The bill would require all Tax Refund Anticipation Loan facilitators other than banks, credit unions, and savings and loan associations to register annually with the Office of Consumer Credit Commissioner. Registered facilitators would be required to file a report including certain information with the agency annually. In addition, the bill would provide the agency authority to pursue consumer complaints and enforcement activities related to the registered entities.
The bill would take effect January 1, 2006.
Based on the number of Internal Revenue Service authorized electronic return originators in Texas, the Office of Consumer Credit Commissioner anticipates a new registrant population of approximately 10,000 Tax Refund Anticipation Loan facilitators.
In order to process registrations, maintain and track the bond requirement, maintain current address locations, process annual renewal billings and collection, and maintain and review the annual reports submitted by the industry, the agency would require an additional Administrative Assistant II position ($18,000 and 0.67 FTE in fiscal year 2006 and $27,000 and 1.0 FTE each year thereafter in salaries and wages), and two Administrative Assistant IV positions ($46,667 1.33 FTEs in fiscal year 2006 and $70,000 2.0 FTEs each year thereafter in salaries and wages).
In order to respond to consumer complaints and pursue enforcement activities against registered Tax Refund Anticipation Loan facilitators, the agency would require an additional Attorney IV position ($42,667 and 0.67 FTE in fiscal year 2006 and $64,000 and 1.0 FTE each year thereafter in salaries and wages), a Legal Assistant II position ($23,333 and 0.67 FTE in fiscal year 2006 and $35,000 and 1.0 FTE each year thereafter in salaries and wages), and an Administrative Assistant III position ($20,000 and 0.67 FTE in fiscal year 2006 and $30,000 and 1.0 FTE each year in salaries and wages).
The agency would require $15,000 in fiscal years 2006 and 2010 for computers and related equipment, $70,000 in fiscal year 2006 for changes to the agency's licensing database, $26,000 in fiscal year 2006 and $39,000 each year thereafter for consumable supplies and other operating expenses, and $44,808 in fiscal year 2006 and $67,212 each year thereafter for employee benefits.
The new provisions set out in the bill would generate sufficient additional revenues to offset the required appropriations and FTE cost. This analysis assumes most of the estimated registrants would apply in FY 2006; their application fees would cover start-up costs.
The Office of Attorney General anticipates any legal work resulting from the passage of this bill could be reasonably absorbed with current resources.
Source Agencies: | 466 Office of Consumer Credit Commissioner, 302 Office of the Attorney General, 451 Department of Banking
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LBB Staff: | JOB, JRO, MW, RB
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