SB 0249 - Fiscal Note

Fiscal Note - SB 0249 - Regulates manufactured home installers

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 0857-04

BILL NO. Perfected SCS for SB 249

SUBJECT: Manufactured Housing: Licenses - Professional

TYPE: Original

DATE: March 11, 1999

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
Manufactured Housing Licensing	$140,000	$2,100	($130,154)
PR Fees	$0	$0	$0
General Revenue	($83,765)	($93,129)	$176,894
Total Estimated Net Effect on All State Funds	$56,235	($91,029)	$46,740

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
None
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 2000	FY 2001	FY 2002
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 6 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials from the Department of Economic Development (DED)-Professional Registration (DPR) assume the proposed legislation would result in potential licensure of 700 individuals. The Missouri Manufactured Housing Institute currently has 320 manufactured housing dealers and 93 manufactured housing manufacturers listed on their registry. It is estimated that each manufactured housing dealer would have two (2) licensed set-up contractors (320 x2 = 640). An additional 60 licenses has been estimated to account for potential independent set-up contractors, resulting in a total of 700.

The projected revenue reflects a $200 fee for all categories of licensure. Revenue for FY 00 would be $140,000 (700 x $200). The fees have been set at a level sufficient to produce revenue to fund the estimated expenditures. In addition, a 3% growth rate has been estimated. It is assumed that a biennial renewal would be established.

It is assumed all funds received by the Board would be deposited into the Manufactured Housing Licensing Fund. Section 8.2 of the proposal states that all expenses for administering this act shall be deducted from General Revenue until such time as the funds in the Manufactured Housing Licensing Fund are sufficient to pay the expense of administering this act. All funds must be repaid by FY 06. It is assumed at the end of FY 02, PR Fees Fund would repay General Revenue and the Manufactured Housing Licensing Fund would reimburse the PR Fees Fund.

DPR is requesting an additional 1.75 FTE to carry out duties generated by this proposal. The additional employees would include a .5 Principal Assistant (.5 FTE at $44,080 per year) to serve as senior executive officer of the board, a .5 Licensure Technician II (.5 FTE at $21,948 per year) to provide technical support directly to the Principal Assistant and the Board and to be responsible for processing applications for licensure, as well as respond to any inquiries relating to the licensure law or rules and regulations, a .5 Clerk IV (.5 FTE at $24,216 per year) to provide support for the Division's Technical Support Services and a .25 Account Clerk II (.25 FTE at $21,108 per year) to provide support for the Division's Central Accounting Section.

In a similar previous proposal, DPR requested a different number of FTE. However, DPR has changed their methodology from prior years in determining FTE requests for new boards.

It is assumed the Board would meet four times per year for two days each. Each Board member would receive a $50 per diem, for an annual total for the seven members of $2,800 ($50 x 7 x 8). Associated travel costs (mileage, lodging and meals) would be $9,598 per year. It is assumed the Board would meet only two times in FY 00.

ASSUMPTION (continued)

DPR has based postage and printing costs on the actual FY 98 usage for a board of similar size and has estimated costs in FY 00 to be $4,319, and $6,400 in subsequent years. Additional costs would be incurred the first year for statute and rule mailings to applicants and for first year start up printing of rules and applications. Office and communication expenses and equipment are based on estimated existing costs within the Division.

Based on FY 98 complaints for an agency of similar size, DPR officials assume there would be 12 complaints filed each year, with an estimate of 15% of the complaints requiring investigation, resulting in 2 investigations. It is estimated that an average investigation would require approximately 30 hours of field work and would be handled by in-house staff and board members. However, if it would be necessary to contract with outside professional experts, additional funding for expense and equipment would be needed. Travel costs to conduct the investigations are estimated at $510 annually. It is assumed the complaints and investigations would not start until FY 02.

It is assumed that existing staff would design, program, and implement a computer licensure program. However, if costs are higher than anticipated, further monies would be required.

Also, it is assumed the Board would utilize a nationally standardized examination. However, if the Board should elect to develop its own examination, costs for such an examination range from $10,000 to $50,000.

It is assumed the Office of the Attorney General (AGO) would provide approximately 60 hours of assistance per year with rules, opinions and meetings. Based on an hourly cost of $58.04, the annual total would be $3,482. Also, it is estimated that 25% of the investigations (1 case) would be forwarded to the AGO for further action. It is assumed there would not be any cases until FY 02. Based on a cost of $5,400 per case, the annual cost would be $5,400.

Officials from the Office of the Secretary of State (SOS) assume the proposed legislation would require the printing of additional pages in the Missouri Register and the Code of State Regulations and have estimated a publishing and distribution cost of $2,303.50 for FY 00. Additionally, future costs are unknown and depends upon the frequency and length of rules filed, amended, rescinded or withdrawn.

While this bill alone would not require SOS to acquire additional staff, SOS assumes the

cumulative effect of additional Register and Code publishing duties could, at some point, require additional staff. However, Oversight assumes SOS could increase fees to cover any additional

ASSUMPTION (continued)

costs, per Section 536.033, RSMo and therefore, has not included associated costs in the fiscal impact specifications below.

Officials from the Office of the Attorney General (AGO), Department of Revenue (DOR), Office of the State Treasurer (STO), Office of Administration - Administrative Hearing Commission (AHC), Department of Labor and Industrial Relations (DOL), Department of Economic Development - Public Service Commission (PSC) and the Office of State Courts Administrator (CTS) assume the proposed legislation would have either minimal or no fiscal impact on their agencies.

FISCAL IMPACT - State Government						FY 2000	FY 2001	FY 2002
						(10 Mo.)
MANUFACTURED HOUSING
LICENSING FUND
Income-Division of Professional Registration (DPR)
Licensure Fees/Renewals	$140,000	$2,100	$148,400
Costs-DPR
Transfer to PR Fees Fund	$0	$0	($278,554)
ESTIMATED NET EFFECT TO
MANUFACTURED HOUSING
LICENSING FUND	$140,000	$2,100	($130,154)
PR FEES FUND
Income-Division of Professional Registration (DPR)
Transfer from Manufactured Housing
Licensing Fund	$0	$0	$278,554
Costs-DPR
Transfer to General Revenue Fund	$0	$0	($278,554)
ESTIMATED NET EFFECT TO
PR FEES FUND	$0	$0	$0
FISCAL IMPACT - State Government	FY 2000	FY 2001	FY 2002
	(10 Mo.)
GENERAL REVENUE FUND
Income-Division of Professional Registration (DPR)
Transfer from PR Fees Fund	$0	$0	$278,554
Costs-DPR
Personal Service (1.75 FTE)	($43,049)	($52,951)	($54,275)
Fringe Benefits	(13,156)	(16,182)	(16,586)
Board Member Per Diem	(1,400)	(2,800)	(2,800)
Expense and Equipment	(22,678)	(17,714)	(18,788)
Other Costs/AGO Costs	(3,482)	(3,482)	(9,211)
Total Costs - DPR	($83,765)	($93,129)	($101,660)
ESTIMATED NET EFFECT TO
GENERAL REVENUE FUND	($83,765)	($93,129)	$176,894
FISCAL IMPACT - Local Government	FY 2000	FY 2001	FY 2002
	(10 Mo.)
	$0	$0	$0
FISCAL IMPACT - Small Business
It is expected that small businesses would have a direct fiscal impact as a result of this proposal.

DESCRIPTION

This bill would create within the Division of Professional Registration the Missouri Manufactured Housing Industry Board. The bill would contain provisions regarding the composition, duties, and powers of the board and how those duties and powers affect those wishing to act as manufactured housing set-up contractors.

Fees collected would be deposited into the newly created Manufactured Housing Licensing Fund.

DESCRIPTION (continued)

The proposal would also contain provisions pertaining to the disciplinary powers of the board, renewal of licenses, revocation and suspension, complaints against licensees, reciprocity,

subpoena powers, and the filing of complaints with the administrative hearing commission.

The proposal would allow for start up funds to be advanced from General Revenue before June 2006, or until such time that funds in the Manufactured Housing Licensing Fund are sufficient to pay expenses.

All set-up contractors must affix decals purchased from the Division of Professional Registration to manufactured homes denoting the date of setup and the name and license number of the contractor.

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

This proposal would affect Total State Revenues.

SOURCES OF INFORMATION

Department of Economic Development - Division of Professional Registration

Office of the Secretary of State

Office of the Attorney General

Department of Revenue

Office of the State Treasurer

Office of Administration - Administrative Hearing Commission

Department of Labor and Industrial Relations

Department of Economic Development - Public Service Commission

Office of State Courts Administrator

Jeanne Jarrett, CPA

Director

March 11, 1999