LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 79TH LEGISLATIVE REGULAR SESSION
 
April 13, 2005

TO:
Honorable Frank Madla, Chair, Senate Committee on Intergovernmental Relations
 
FROM:
John S. O'Brien, Deputy Director, Legislative Budget Board
 
IN RE:
SB1850 by Gallegos (Relating to the regulation of certain businesses that sell alcoholic beverages in certain counties; providing an administrative penalty.), As Introduced



Estimated Two-year Net Impact to General Revenue Related Funds for SB1850, As Introduced: a positive impact of $2,181,112 through the biennium ending August 31, 2007.

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
2006 $1,056,881
2007 $1,124,231
2008 $1,149,206
2009 $1,174,756
2010 $1,200,881




Fiscal Year Probable Revenue Gain/(Loss) from
GENERAL REVENUE FUND
1 		Probable (Cost) from
GENERAL REVENUE FUND
1 		Change in Number of State Employees from FY 2005
2006 $1,230,075 ($173,194) 2.5
2007 $1,254,225 ($129,994) 2.5
2008 $1,279,200 ($129,994) 2.5
2009 $1,304,750 ($129,994) 2.5
2010 $1,330,875 ($129,994) 2.5

Fiscal Analysis

The bill would amend Chapter 11 and Chapter 25 of the Alcoholic Beverage Code relating to the regulation of certain businesses that sell alcoholic beverages in a county with a population of 3 million or more.  The regulations would set the annual state fee for the renewal of a wine and beer retailer's permit at $750 and the original application fee at $1,000. The bill would also require a person applying for a license or permit for the on-premise consumption of alcoholic beverages to file a surety bond with the Texas Alcoholic Beverage Commission (TABC).

The bill would authorize TABC to impose an administrative penalty not to exceed $4,000 if a permitee makes a false or misleading statement in the application process.

The bill would take effect September 1, 2005.


Methodology

According to the 2000 federal census, only Harris County meets the population requirements of the bill. Under current statute, the fee for a beer and wine retail permit is $175. There would be an increase in revenue to the General Revenue Fund of approximately $1.2 million in fiscal year 2006. This estimate is based on the proposed fees of $750 for renewing a beer and wine retailer's permit and $1,000 for a new permit. Currently, there are 2,079 beer and wine retail permitees in Harris County. This revenue estimate assumes 2,079 renewals and 42 original applications in fiscal year 2006 and two percent growth in subsequent fiscal years.  This estimate does not include revenue that might be generated from the forfeiture of bonds nor does it include administrative penalties that may be imposed.

The TABC estimates start-up costs of $5,000 in the Licensing Division for programming updates to current TABC systems, in addition to $30,800 for updates to various forms and publications. The Licensing Division would also need one additional full-time-equivalent Accounts Examiner IV position at a cost of $53,441 in fiscal year 2006 and $49,741 in subsequent fiscal years.

TABC also estimates there would be an increase of 200 to 300 in the number of administrative hearings as a result of implementation of the bill. The Legal Division would therefore incur costs of $3,700 for equipment and furnishings and $80,253 in salaries (1.5 FTEs), benefits, and operating costs in fiscal year 2006. In subsequent fiscal years, the salaries, benefits, and operating costs would continue at $80,253, which includes $1,500 in professional fees for transcripts from the hearings.


Technology

Technology costs include $5,000 for programming systems to comply with the provisions of the bill.

Local Government Impact

No fiscal implication to units of local government is anticipated.


Source Agencies:
458 Alcoholic Beverage Commission
LBB Staff:
JOB, VDS, DLBa