This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0614 - Management of Flood Plain Development
L.R. NO.  2449-01
BILL NO.  SB 614
SUBJECT:  Flood Plains
TYPE:     Original
DATE:     January 15, 1996



                              FISCAL SUMMARY


                    ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED                 FY 1997         FY 1998        FY 1999

General Revenue            ($365,255)      ($363,872)     ($377,023)


Total Estimated
Net Effect on All
State Funds*               ($365,255)      ($363,872)     ($377,023)

* Estimates do not include the potential costs of flood-proofing existing
state structures and obtaining additional flood insurance, subject to
appropriations.

                   ESTIMATED NET EFFECT ON FEDERAL FUNDS

FUND AFFECTED                 FY 1997         FY 1998        FY 1999

None


Total Estimated
Net Effect on All
Federal Funds                      $0              $0             $0

                    ESTIMATED NET EFFECT ON LOCAL FUNDS

FUND AFFECTED                 FY 1997         FY 1998        FY 1999

Local Government                   $0              $0             $0



                              FISCAL ANALYSIS

ASSUMPTION

Officials of the following departments assume that this proposal would not
fiscally impact their agency: Department of Economic Development, Department
of Mental Health, Department of Health, Department of Social Services, Office
of Administration, State Auditor's Office, Department of Insurance, Secretary
of State, Department of Revenue, Department of Highway and Transportation,
Department of Elementary and Secondary Education and the Department of Labor
and Industrial Relations.

Officials of the Department of Natural Resources (DNR) assume that the
structures referred to in the legislation would include playgrounds, ball
fields, etc. in the Division of State Parks, and consequently over 200
structures would presently exist in a floodway.  Flood-proofing these
structures would require reconstruction of most structures, for which DNR
estimates costs would exceed $15,000,000.  Additional costs would be incurred
for flood-insuring all structures in the floodway.  DNR would also request
personal service costs, fringe benefits, and related equipment and expense
for .5 FTE (Hydrologist II) for duties related to the legislation, including
review of applications for levee permits, assistance with flood-proofing
structures, etc.  Oversight assumes that existing staff would be able to
perform the additional duties required.

Officials of the Department of Agriculture (DOA) indicate that one-half of an
existing FTE's time would be spent in carrying out the legislation's
provisions.  They would request personal service costs, fringe benefits, and
related equipment and expense.   Oversight assumes that existing personnel
would perform new duties required by the legislation, and that additional
costs would not be incurred by DOA.

In a similar proposal officials of the Office of the Attorney General
indicated that establishment of the Flood Plain Insurance Fraud Task Force
would require the addition of two FTE's (one Assistant Attorney General I and
one legal secretary), plus related fringe benefits, equipment and expense.

Officials of the State Emergency Management Agency state that their current
budget has three FTE's to handle floodplain management. Currently, these
three FTE's are being funded by 25 percent state general revenue funds. The
remaining funds for these FTE's are federal. A decision item of $83,342 was
submitted for FY 1996  which would allow funding for these FTE's totally from
state general revenue funds instead of having to rely on federal funding.
These three employees would be needed to handle floodplain management issues,
if this legislation is enacted. An additional six employees would be
requested in order to adequately administer the permitting process, ensure
compliance in the local jurisdictions and provide technical assistance and
data. Oversight assumes that only the administrative cost of the additional
six employees should be reflected, for purposes of this fiscal note and has
allowed only one vehicle instead of the three requested.

Officials of the Missouri Department of Conservation (MDC) assume that the
legislation's definition of "floodway" and "structure" would not contradict
the federal definitions. Given these assumptions the Department of
Conservation would not be significantly impacted by the requirement to
flood-proof existing state structures. Section 49.620 (4) states "...The
state shall, subject to appropriation, insure that all state structures that
lie in the one hundred year floodway are insured to the minimum national
flood insurance program standards..." MDC is self-insured and therefore this
provision would not have a fiscal impact on their agency.

Section 49.629 would establish a "Levee Tax Fund" in the state treasury.
Money for this fund would come from two places: 1) a one-tenth of one percent
tax on the assessed value of all properties protected by industrial levees
(500-yr levee or greater); and 2) an unspecified and therefore unlimited
amount from the conservation tax fund. The Levee Tax Fund would be used to
provide the 20% cost share (P.L. 84-99) for those landowners who voluntarily
sign an agreement that, after the next flood event, they shall not rebuild
their agricultural levee beyond the twenty year level of protection. Using
conservation tax funds for the provisions of this draft bill conflicts with
the Missouri Constitution. Given that most levees along the Missouri River
are below the 20-year protection level, they assume most levee districts
would be eligible and take advantage of the proposed "Levee Tax Fund". The
one-tenth of one percent tax on industrial levee protection can occur no more
than once every ten years and the amount that tax would generate is unknown.
Oversight assumes that since the legislation would allow such an assessment
no more than once every ten years, for purposes of this fiscal note, there
would be no expected revenues.

Oversight assumes that the legislation will require flood-proofing all
existing state structures within the floodway, as well as obtaining insurance
on all state structures within the floodway to meet the minimum national
flood insurance program standards, subject to appropriation.   It is assumed
that all affected state agencies would request necessary funding during the
normal budgeting process.

FISCAL IMPACT - State Government     FY 1997     FY 1998     FY 1999
                                    (10 Mo.)
GENERAL REVENUE FUND
Costs-Division of Flood Plain Management
   Personal services (6 FTE's)    ($147,480)  ($184,055)  ($191,416)
   Fringe benefits                  (45,335)    (56,579)    (58,841)
   Equipment and expense            (87,206)    (34,760)    (35,952)
 Total Costs-Division of Flood Plain
   Management                     ($280,021)  ($275,394)  ($286,209)
  Costs-Attorney General's office
   Personal services (2 FTE's)     ($39,583)   ($48,688)   ($49,905)
   Fringe benefits                  (12,168)    (14,967)    (15,341)
   Equipment and expense            (33,483)    (24,823)    (25,568)
 Total Costs-Attorney General's
   office                          ($85,234)   ($88,478)   ($90,814)

ESTIMATED NET EFFECT ON
GENERAL REVENUE FUND *            ($365,255)  ($363,872)  ($377,023)

*  Estimates do not include the potential costs of flood-proofing existing
state structures and obtaining additional flood insurance, subject to
appropriations.

FISCAL IMPACT - Local Government     FY 1997     FY 1998     FY 1999
                                    (10 Mo.)

                                           0           0           0

DESCRIPTION

This legislation would establish the Division of Flood Plain Management
within the State Emergency Management Agency for the purpose of implementing
flood plain management policies for the state.  The Division's
responsibilities would include issuing permits for the building of certain
structures, including levees, in certain areas within the one-hundred year
flood plain,  as well as working with the U.S. Army Corps of Engineers in
establishing elevations for all levees in the state.  Notice of permit
applications are to be forwarded to the Department of Natural Resources and
the Department of Agriculture for review and comment. A levy district may
enter into an agreement with the Division to restrict the reconstruction of
its levee, after the next flood, to the 25 year level. If a district signs
such an agreement, it shall be eligible for state funds from the "Levee Tax
Fund", created by this act in the state treasury, to meet the 20% cost-share
required to obtain federal funds for levee reconstruction. No more than once
every ten years, the division may levy an assessment against all property
located in a levee system with at least a one-hundred year level of
protection.  The amount of the levy shall be one-tenth of one percent of the
assessed valuation of the property located in such a levee system.  Monies
collected are to be credited into the newly-established "Levee Tax Fund." It
would require that no new state construction be located in the one- hundred
year flood plain, and that all existing state structures located in the
floodway be flood-proofed, subject to appropriations.  All projects of the
state in flood plains must meet the standards of the national flood insurance
program, and all state structures existing within the one-hundred year
floodway are to be insured to the minimum national flood insurance program
standards, subject to appropriations.

The legislation would create within the Attorney General's Office a Flood
Plain Insurance Fraud Task Force for the purpose of reviewing all federal and
state monies appropriated to aid in flood recovery during FY 1994 and 1995
and determining whether any such money has been obtained fraudulently.

This legislation is not federally mandated, would not duplicate any other
program and would not require additional capital improvements or rental
space.

SOURCES OF INFORMATION

Department of Economic Development
Department of Natural Resources
Department of Agriculture
Office of the Attorney General
State Emergency Management Agency
Department of Conservation
Department of Mental Health
Department of Health
Department of Social Services
Office of Administration
State Auditor's Office
Department of Insurance
Secretary of State
Department of Revenue
Department of Highway and Transportation
Department of Elementary and Secondary Education
Department of Labor and Industrial Relations