LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 83RD LEGISLATIVE REGULAR SESSION

April 22, 2013

TO:	Honorable Craig Estes, Chair, Senate Committee on Agriculture, Rural Affairs & Homeland Security
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	SB1554 by Lucio (Relating to the establishment of a matching grant program for rural economic development.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for SB1554, As Introduced: a negative impact of ($5,143,027) through the biennium ending August 31, 2015.

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

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2014	($2,573,696)
2015	($2,569,331)
2016	($2,569,331)
2017	($2,569,331)
2018	($2,569,331)

All Funds, Five-Year Impact:

Fiscal Year	Probable Savings/(Cost) from General Revenue Fund 1	Change in Number of State Employees from FY 2013
2014	($2,573,696)	1.0
2015	($2,569,331)	1.0
2016	($2,569,331)	1.0
2017	($2,569,331)	1.0
2018	($2,569,331)	1.0

Fiscal Analysis

The bill would amend the Government Code requiring the Department of Rural Affairs within the Texas Department of Agriculture (TDA) to create the Rural Area Regional Planning and Implementation Matching Grant Program to foster regional collaboration for community and economic development in rural areas. The bill would provide TDA the authority to award matching grants for planning and implementation of regionally identified objectives in rural areas.

Methodology

This estimate assumes TDA would administer a matching grant program of $2.5 million per fiscal year from General Revenue Fund to implement the provisions of the bill. The average grant awarded through the program would be $250,000 and the program would fund no more than 10 grants per fiscal year.  According to the agency, TDA would seek stakeholder input in creating the program. The Rural Area Regional Planning and Implementation Matching Grant Program would use a combination of collaborative planning and capacity building grants as well as implementation grants that could fund public infrastructure to both support communities and augment economic development objectives in rural areas.

 
Based on information provided by TDA, the agency would require administrative costs, including 1.0 FTE, of $73,696 in fiscal year 2014 and $69,331 each subsequent year. Administrative costs consist of annual salary and benefits costs of $68,841 per year and other operating expenses of $490 per year. This estimate assumes additional first year start up costs of $4,365.

Local Government Impact

Local entities accepted for grant funding would receive new funds but would also be required to provide matching funds. Since the grant application process is discretionary, it is assumed a local entity would apply only if sufficient matching funds were available.

Source Agencies:

551 Department of Agriculture

LBB Staff:

UP, SZ, ZS, JP, KKR