Honorable Tracy O. King, Chair, House Committee on Natural Resources
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB2941 by Zwiener (relating to the authority of the Railroad Commission of Texas to require water pollution abatement plans for certain pipelines; providing for the imposition of a civil penalty.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for HB2941, Committee Report 1st House, Substituted : a negative impact of ($1,932,581) through the biennium ending August 31, 2025.
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
2024
($1,610,484)
2025
($322,097)
2026
($241,573)
2027
($161,048)
2028
($161,048)
All Funds, Five-Year Impact:
Fiscal Year
Probable (Cost) from General Revenue Fund 1
Probable (Cost) from Water Resource Management 153
Probable (Cost) from Oil & Gas Regulation 5155
Change in Number of State Employees from FY 2023
2024
($1,610,484)
($102,128)
($224,525)
3.0
2025
($322,097)
($246,096)
($171,832)
4.0
2026
($241,573)
($226,276)
($171,832)
4.0
2027
($161,048)
($226,276)
($171,832)
4.0
2028
($161,048)
($226,276)
($171,832)
4.0
Fiscal Analysis
The bill would add Section 26.136 to the Texas Water Code relating to Edwards Aquifer protection plans and would amend Section 91 of the Natural Resources Code as it relates to enforcement authority.
The bill would direct the Railroad Commission to require the owner or operator of an oil or gas pipeline under the agency's jurisdiction to submit a water pollution abatement plan (WPAP) to the agency upon constructing or expanding a pipeline into the Edwards Aquifer recharge zone.
The bill would direct the Railroad Commission (RRC) to consult with the Texas Commission on Environmental Quality (TCEQ) in developing certain temporary best management practices for WPAPs and would allow the RRC to incorporate construction best management practices adopted for the recharge zone by TCEQ.
The bill would require RRC and TCEQ to develop a process for joint consultation on water pollution abatement activities in the recharge zone and direct the two agencies to enter into a memorandum of understanding to implement this process.
The bill would expand Railroad Commission's enforcement authority as it relates to Section 26.136.
The bill would take effect September 1, 2024.
Methodology
Based on information provided by the Railroad Commission (RRC), this analysis assumes RRC would need two new FTEs, related operating equipment and expenses, one vehicle, and a new online system. The first FTE, a Geoscientist II, would conduct administrative and technical reviews of the submitted water pollution abatement plans (WPAPs) as well as any required supplemental information. The second, an Engineering Specialist II, would inspect the sites during and/or after construction to verify compliance with statute and any rulemaking. Both FTEs would be necessary in fiscal year 2024 in order to facilitate program planning, development, and implementation. Estimated salary, benefit, and payroll contribution expenses for the two positions would total $141,832 per fiscal year from General Revenue-Dedicated Oil and Gas Regulation and Cleanup Account No. 5155 (GR-D 5155). Operating expenses are estimated to total $82,693 in fiscal year 2024, an amount which partially reflects the purchase of a truck, and $30,000 each fiscal year after from GR-D 5155.
Based on information provided by the RRC, General Revenue totaling $1,610,484 in fiscal year 2024 with additional maintenance costs of $322,097 for fiscal year 2025; $241,573 for fiscal year 2026; and $161,048 each subsequent fiscal year would be necessary for the development of an online system to allow operators to submit data for agency staff to review and approve or deny. This system would access and supplement data from the agency's Oversight and Safety Division.
Based on information provided by the Texas Commission on Environmental Quality (TCEQ), this analysis assumes TCEQ would need one additional FTE beginning in fiscal year 2024, a second additional FTE beginning in fiscal year 2025, two vehicles, and related operating equipment and expenses. The first FTE, an Environmental Investigator II, would provide consultation services to the RRC on the application review process, rulemaking, and compliance for oil and gas pipelines. This FTE would coordinate with RRC as it develops the new program prior to and following the effective date. The second, a Geoscientist IV, would provide consultation services to the RRC regarding geologic assessments and encountered features for oil and gas pipelines after the effective date. The estimated salary, benefit, and payroll contribution expenses for these positions would total $76,811 in fiscal year 2024 and $212,600 each fiscal year after from General Revenue-Dedicated Water Resource Management Account No. 153. Operating expenses would total $25,317 in fiscal year 2024, $33,496 in fiscal year 2025, and $13,676 each fiscal year after from GR-D 153. Estimates for operating expenses in fiscal year 2024 and 2025 reflect one-time costs anticipated, including the purchase of vehicles and equipment.
Technology
General Revenue totaling $1,610,484 in fiscal year 2024 with additional maintenance costs of $322,097 for fiscal year 2025; $241,573 for fiscal year 2026; and $161,048 each subsequent fiscal year would be necessary for RRC to develop an online system to implement the provisions of the bill.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies:
212 Office of Court Administration, Texas Judicial Council, 304 Comptroller of Public Accounts, 455 Railroad Commission, 582 Commission on Environmental Quality