Fiscal Note - SB 0176 - Authorizes Additional State Bonds For Water Pollution Control Projects
L.R. NO. 0718-01
BILL NO. Truly Agreed to and Finally Passed SB 176
SUBJECT: Bonds: Natural Resources
TYPE: Original
DATE: May 8, 1997
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
General Revenue ($3,093,023) ($2,944,992) ($2,945,289)
Total Estimated
Net Effect on All
State Funds ($3,093,023) ($2,944,992) ($2,945,289)
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None $0 $0 $0
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
Officials of the Office of Administration - Division of Accounting (OA)
indicate that the bond issue date would depend on the use of available bond
proceeds from bonds authorized but not yet issued. OA officials assume a
single bond sale, 25-year maturities, 8.5% interest rate, level debt service,
and annualized costs based on a sale in fiscal year 1998. Based on these
factors, annual debt service would approximate $2,931,350.
OA officials also assume that one-time costs per issue would include personal
services of .06 Director, .12 Assistant Director, .12 Accounting Analyst IV,
.17 Accounting Analyst II, and .04 Clerk Typist III plus fringe benefits for
total one-time personnel costs of $30,017. One-time costs would also include
issuance costs, including costs of financial advisor, legal counsel,
printing, rating agency fees, official statements, etc. at a total cost of
$150,000. Total one-time costs for FY 1998 would be $180,017.
Oversight assumes that the one-time personal services noted above would be
performed by existing staff, with no increased costs to OA for those
services.
OA officials also request that .25 Executive Assistant be hired to initiate
general revenue transfers to the appropriate debt service funds, reconcile
all paying agent transactions for principal and interest, and monitor all
fees due to the paying agent. Total costs for this position, including
fringe benefits, equipment and expense would be $9,673 in FY 1998, $11,642 in
FY 1999, and $11,939 in FY 2000. Paying agent fees are expected to
approximate $2,000 each year.
There would be no direct fiscal impact to the Department of Natural Resources
(DNR). Funds would be used as follows: $24 million for the State Revolving
Fund (SRF) (20% match required to receive federal funds) and $6 million for
the 40% State Construction Grant Program for those economically disadvantaged
communities that do not qualify for the SRF loan program.
FISCAL IMPACT - State Government FY 1998 FY 1999 FY 2000
10 Mo.)
GENERAL REVENUE FUND
Cost-Office of Administration
Personal service (.25 FTE) (6,524) (8,025) (8,225)
Fringe benefits (1,861) (2,290) (2,347)
Equipment and expense (1,288) (1,327) (1,367)
Paying agent fees (2,000) (2,000) (2,000)
Cost of issuance (150,000) 0 0
Transfer to principal & interest
sinking fund (2,931,350) (2,931,350) ($2,931,350)
ESTIMATED NET EFFECT ON
GENERAL REVENUE FUND ($3,093,023) ($2,944,992) ($2,945,289)
Total cost for bond redemption and interest over the life of the bond issues
would be approximately $73,283,750.
FISCAL IMPACT - Local Government FY 1998 FY 1999 FY 2000
(10 Mo.)
0 0 0
FISCAL IMPACT - Small Business
No direct fiscal impact to small businesses would be expected as a result of
this proposal.
DESCRIPTION
This legislation authorizes the issuance of $30 million in bonds for the
purpose of providing funds for water pollution control.
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
Office of Administration - Division of Accounting
Department of Natural Resources
This Fiscal Note is not an official copy and should not be quoted or cited.