Honorable Larry Phillips, Chair, House Committee on Homeland Security & Public Safety
FROM:
Ursula Parks, Director, Legislative Budget Board
IN RE:
HB2911 by Stephenson (Relating to establishment of statewide and local emergency communications grant programs and financing of state emergency communications.), As Introduced
Estimated Two Year Net Impact to General Revenue Related Funds for HB 2911, As Introduced: ($7,500,040) through the biennium ending August 31, 2017.
The bill would result in a decrease in the amount available for certification by ($189,362,000) in the 2016-17 biennium.
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
2016
($3,750,020)
2017
($3,750,020)
2018
($3,750,020)
2019
($3,750,020)
2020
($3,750,020)
Fiscal Year
Probable Savings/(Cost) from 911 Service Fees 5050
Probable Revenue (Loss) from Comm State Emer Comm Acct 5007
Probable Savings/(Cost) from General Revenue Fund 1
Probable Revenue Gain from New Trust Fund in the Texas Safekeeping Trust Company
2016
($148,139,084)
($36,172,780)
($3,750,020)
$259,112,949
2017
$6,952,502
($3,191,780)
($3,750,020)
$71,040,363
2018
$6,952,502
($3,191,780)
($3,750,020)
$71,040,363
2019
$6,952,502
($3,191,780)
($3,750,020)
$71,040,363
2020
$6,952,502
($3,191,780)
($3,750,020)
$71,040,363
Fiscal Year
Change in Number of State Employees from FY 2015
2016
(25.0)
2017
(25.0)
2018
(25.0)
2019
(25.0)
2020
(25.0)
Fiscal Analysis
The bill would amend Health and Safety Code to establish a trust fund outside the state treasury; authorize the transfer of fund balances and future revenues from General Revenue - Dedicated Account 5050 (GR-D 5050) and General Revenue - Dedicated Account 5007 (GR-D 5007) to the newly established trust fund; and establish a grant program to finance the provision of capital assets to emergency responders and poison control centers. The bill would also remove the Commission on State Emergency Communications (CSEC) from the legislative budgeting process.
CSEC and the Comptroller estimate that passage of the bill would result in a decrease of $19,850,000 in fee collected revenue deposited into GR-D 5007 each fiscal year and $49,900,949 in fee collected revenue deposited into GR-D 5050 in fiscal year 2016 and $51,190,363 from fiscal year 2017 to 2020. Additionally, the Legislative Budget Board (LBB) estimates an additional decrease of 25.0 FTEs and a $3,750,020 cost to General Revenue each fiscal year.
The Comptroller estimates the fiscal year 2015 ending fund balances of $156,381,000 in GR-D 5050 and $32,981,000 in GR-D 5007 which would be transferred to the newly established trust fund from the respective accounts. This transfer would be offset by a decrease in direct appropriations to CSEC, the Department of State Health Services (DSHS) and The University of Texas Medical Branch at Galveston (UTMB - Galveston) out of GR-D 5007 by $16,658,220 and GR-D 5050 by $58,142,865 each fiscal year from 2016 to 2020.
This legislation would do one or more of the following: create or recreate a dedicated account in the General Revenue Fund, create or recreate a special or trust fund either with or outside of the Treasury, or create a dedicated revenue source. The fund, account, or revenue dedication included in this bill would be subject to funds consolidation review by the current Legislature.
The bill would take effect September 1, 2015.
Methodology
Based on CSEC and LBB analysis, it is assumed that the agency would be removed from the legislative budgeting process and therefore would no longer receive FTEs or direct appropriations for funding from the state. These appropriations are assumed to be a cost savings to the state and are calculated using the average appropriation made from GR-D 5007 ($14,783,210) and GR-D 5050 ($58,142,865) each fiscal year during the 2014-15 biennium.
Under current law, DSHS and UTMB - Galveston also receive an appropriation of $1,821,575 and $53,438 from GR-D 5007 respectively each fiscal year for the 2014-15 biennium. This analysis assumes that General Revenue would be appropriated for this purpose in fiscal year 2016 and each fiscal year thereafter.
The estimated fiscal year 2015 ending balances and revenues for GR-D 5050 and GR-D 5007 were estimated based on the Comptroller's 2016-17 Biennial Revenue Estimate.
Local Government Impact
The bill would have a significant fiscal impact on regional councils of government and 9-1-1 programs. The bill would require emergency communications districts to transfer surplus revenue to a special reserve account at the end of each fiscal year and establish and administer a local emergency communications grant program. Emergency services districts would also be required to reduce their effective tax rate and rollback tax rate to offset their share of the remaining surplus revenue. According to the Comptroller, in a year in which an emergency services district which has received surplus funds does not receive surplus funds, the effective tax rate and rollback tax rate would be increased to offset the loss in surplus funds.
Wichita-Wilbarger 9-1-1 District reported that no fiscal impact is anticipated, as the district does not maintain 24 months of operating expenses in a fiscal year.
El Paso County 9-1-1 District reported that the fiscal impact could not be determined at this time; however; the district does not maintain surplus funds.
South East Texas Regional Planning Commission reported there would be a moderate revenue loss of $146,473 for fiscal year 2016-17 as the result of the bill's funding formula.
Heart of Texas Council of Governments reported a total cost of $1,237,563, including 3 additional staff, equipment, network, maintenance, and other operational costs in fiscal year 2016. In addition, there would be a revenue loss of $669,100 per year.
Concho Valley Council of Governments reported a total cost of $3,287,095, including 6.75 additional FTEs, equipment, network, maintenance, and other operational costs in fiscal year 2016. In addition, there would be a revenue loss of $2,114,951 in fiscal year 2016 and $1,076,457 in fiscal year 2017.
Permian Basin Regional Planning Commission reported revenue loss of $658,685 per year in fiscal years 2016-2017.
South Plains Association of Governments reported a total cost of $55,000 for additional staff and $1,400,000 for replacement equipment and network operations in fiscal year 2016 to comply with the provisions of the bill.
The Alamo Area Council of Governments reported a revenue shortfall of $287,247 for fiscal years 2016-2017. In addition, there would a total cost of $50,000 for additional staff to comply with the provisions of the bill.
The Commission on State Emergency Communications reported a statewide local impact of $224,265,566 in fiscal year 2016; $57,587,259 in fiscal year 2017; $60,525,770 in fiscal year 2018; $61,260,398 in fiscal year 2019; and $61,444,055 in fiscal year 2020.
The bill may result in savings to a emergency responders and local poison control centers in an amount equivalent to the grant funding provided by statewide emergency communication grant program.
Source Agencies:
304 Comptroller of Public Accounts, 477 Commission on State Emergency Communications