SB 0623 - Fiscal Note

Fiscal Note - SB 0623 - Changes operational control of the St. Louis International Airport

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 2739-01

BILL NO. SB 623

SUBJECT: Aircraft & Airports

TYPE: Original

DATE: January 12, 1998

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
None	$0	$0	$0
Total Estimated Net Effect on All State Funds	$0	$0	$0

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
None	$0	$0	$0
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 3 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials of the Department of Transportation assume that there would be no fiscal impact to the department or to the state as a result of this proposal. Department officials indicated in response to a similar proposal in the prior session that they assume the Missouri-St. Louis Metropolitan Airport Authority is not a state agency, but rather a political subdivision.

Officials of the City of St. Louis indicate as they did in response to a similar proposal in the prior session that a legal interpretation from the City Counselor's office indicates that the proposal would transfer responsibility for all bonded indebtedness and other obligations of Lambert Airport to the state, as the Missouri-St. Louis Airport Authority is a state agency. Figures provided in the prior year indicated that the airport had estimated outstanding bonded indebtedness and construction liabilities of $428,000,000, as well as possible costs for nuclear waste clean-up under federal Superfund legislation estimated at $325,000,000.

Oversight notes that the effective date of the proposal is January 1, 2004; therefore, any potential fiscal impact would not be effective until after that date. Oversight also notes that the proposal states that "the authority shall honor all bonds, debts, outstanding obligation and contracts of any airport or airport authority affected by this section." However, RSMo 305.520 currently allows the Missouri-St. Louis Metropolitan Airport Authority to assume and pay, or guarantee the payment of the principal and interest of any bonds secured by any airport in the Missouri-St. Louis metropolitan area. It further states that such an assumption or guaranty does not constitute a debt of the Authority or the state of Missouri within the meaning of the constitution and state law. Therefore, Oversight assumes that there would be no impact to the state as a result of this provision. However, this assumption is also based on revenues earned by the airport being adequate to service all outstanding indebtedness and obligations. If airport revenues are not adequate to service the outstanding debt, then the state could potentially be required to honor the debt in order to maintain the state's current bond rating.

The provision in the proposal that would eliminate the current statutory prohibition against the general assembly appropriating funds to the Missouri-St. Louis Metropolitan Airport Authority would also not be effective until January 1, 2004 and would therefore have no fiscal impact during the fiscal note period. Fiscal notes for previous similar legislation have reflected potential annual costs (subject to appropriation) of $150,000 representing personal service, fringe benefits and equipment and expense costs.

FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
	0	0	0
FISCAL IMPACT - Local Government	FY 1999	FY 2000	FY 2001
	(10 Mo.)
	0	0	0

FISCAL IMPACT - Small Business

No direct fiscal impact to small businesses is expected as a result of this proposal.

DESCRIPTION

The proposal would transfer the operation of any and all international airports located in Missouri within fifty miles of the City of St. Louis to the Missouri-St. Louis Metropolitan Airport Authority. The ownership of such airport would not change. The Authority would be required to honor all bonds, debts, outstanding obligations and contracts of any such airport. The membership of the Authority would also be revised.

The proposal would eliminate the current statutory prohibition against the general assembly appropriating state moneys to the Missouri-St. Louis Metropolitan Airport Authority.

The legislation is to be effective January 1, 2004.

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 Transportation

City of St. Louis

Jeanne Jarrett, CPA

Director

January 12, 1998