LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 86TH LEGISLATIVE REGULAR SESSION
 
April 29, 2019

TO:
Honorable Lyle Larson, Chair, House Committee on Natural Resources
 
FROM:
John McGeady, Assistant Director     Sarah Keyton, Assistant Director
Legislative Budget Board
 
IN RE:
HJR114 by Coleman (Proposing a constitutional amendment providing for the issuance of general obligation bonds to be paid out of the economic stabilization fund by the Texas Water Development Board to provide financial assistance to political subdivisions for projects related to disaster recovery; disaster mitigation; disaster response; or construct, repair, rehabilitate, or reconstruct state or local infrastructure.), As Introduced



Estimated Two-year Net Impact to General Revenue Related Funds for HJR114, As Introduced: a negative impact of ($177,289) through the biennium ending August 31, 2021.



Fiscal Year Appropriation out of
Economic Stabilization Fund
599
2020 $0
2021 $220,000,000



Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2020 $0
2021 $0




Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2020 ($177,289)
2021 $0
2022 $0
2023 $0
2024 $0




Fiscal Year Probable (Cost) from
General Revenue Fund
1 		Probable (Cost) from
Economic Stabilization Fund
599
2020 ($177,289) $0
2021 $0 ($220,000,000)
2022 $0 ($434,000,000)
2023 $0 ($642,000,000)
2024 $0 ($844,000,000)

Fiscal Analysis

The joint resolution proposes a constitutional amendment to Article XIV of the Texas Constitution that would allow the Texas Water Development Board (TWDB) to issue additional general obligation bonds in an amount not to exceed $10 billion. It would appropriate an amount sufficient to pay the principal of and interest on the bonds from the first money coming into the Economic Stabilization Fund or treasury each fiscal year while any of the bonds or interest on the bonds is outstanding. The resolution would authorize the bonds to be used to provide loans and grants to fund disaster recovery, mitigation, and response projects and to fund the construction, repair, and rehabilitation of state or local infrastructure.

The proposed amendment would be submitted to voters at an election to be held November 5, 2019.

Methodology

Based on the analysis of TWDB, it is assumed that the bonds will be issued in the amount of $2 billion each year for five years, beginning in fiscal 2020. Debt service would begin in fiscal year 2021, and would be paid with funds from the Economic Stabilization Fund. The bonds would be issued at 6 percent interest rates, with level principal payments, for 20-year terms.  

The cost to the state for publication of the resolution is $177,289.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.


Source Agencies:
304 Comptroller of Public Accounts, 352 Bond Review Board, 580 Water Development Board
LBB Staff:
WP, SZ, MW, PBO