Honorable Robert Nichols, Chair, Senate Committee on Transportation
FROM:
John McGeady, Assistant Director Sarah Keyton, Assistant Director Legislative Budget Board
IN RE:
HB3737 by Lucio III (Relating to the administration of the financial responsibility verification program.), As Engrossed
Estimated Two-year Net Impact to General Revenue Related Funds for HB3737, As Engrossed: an impact of $0 through the biennium ending August 31, 2021.
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
2020
$0
2021
$0
2022
$0
2023
$0
2024
$0
Fiscal Year
Probable Revenue Gain/(Loss) from State Highway Fund 6
Probable Revenue Gain/(Loss) from TexasSure Fund 161
Probable Savings/(Cost) from TexasSure Fund 161
2020
($519,404)
$519,404
($519,404)
2021
($481,529)
$481,529
($481,529)
2022
($481,529)
$481,529
($481,529)
2023
($481,529)
$481,529
($481,529)
2024
($481,529)
$481,529
($481,529)
Fiscal Analysis
The bill would require the transfer of the powers, duties, functions, and activities of the Texas Department of Insurance (TDI) relating to the financial responsibility verification program under Subchapter N, Chapter 601, Transportation Code, to the Department of Motor Vehicles (DMV).
The bill would take effect immediately upon receiving a vote of two-thirds of all members elected to each house or otherwise on September 1, 2019.
Methodology
Based on LBB's analysis of information provided by DMV, it is assumed DMV would require 5.0 additional FTEs beginning in fiscal year 2020 to accommodate the responsibilities associated with motor vehicle financial responsibility program (TexasSure), which include the following: one Contract Specialist IV ($63,616 annual salary) to manage vendor contracts; one Attorney IV ($83,298) to handle legal issues related to contracts and insurance company compliance; one Manager II FTE ($72,789) and one Program Specialist III ($55,602) to manage the TexasSure program and ensure vendor and state agency compliance; and one Business Analyst III ($76,862) to verify information technology deliverables and business process models. Employee benefits costs for these additional FTEs are estimated to be $118,064 each year (33.43% of salaries), and payroll contributions for group insurance and retirement are estimated to be $5,298 each year (1.5% of salaries). Initial costs for computers, furniture, and office equipment are estimated to be $37,875 in fiscal year 2020. Other operating expenses are estimated to be $5,000 in each fiscal year, beginning in fiscal year 2020.
TDI currently receives appropriations from TexasSure Fund No. 161 for the vendor contract for ongoing maintenance of the TexasSure Motor Vehicle Financial Responsibility Verification system. Dependent on enactment of the bill, this analysis assumes the appropriation of $10.1 million for the 2020-21 biennium from the TexasSure Fund No. 161 would transfer from TDI to TxDMV for the same purpose. It is assumed additional costs of $519,404 in fiscal year 2020 and $481,529 in subsequent fiscal years for DMV would also be funded from TexasSure Fund No. 161.
Transportation Code §502.357(b) directs that certain fees collected at the time of motor vehicle registration are deposited to the TexasSure Fund No. 161 in an amount equal to cover the amount appropriated to TDI from the TexasSure Fund No. 161. The bill would amend §502.357(b) to base the disposition of fee revenue on the amount appropriated to DMV from TexasSure Fund No. 161. Fees otherwise would be deposited to the credit of the State Highway Fund 6. Therefore, any increase in appropriations to the TexasSure Fund No. 161 would result in an equivalent increase in revenue to the TexasSure Fund No. 161 and an equivalent decrease in revenue to the State Highway Fund 6.
Local Government Impact
No fiscal implication to units of local government is anticipated.