NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.



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F I S C A L I M P A C T R E P O R T





SPONSOR: Rodriguez DATE TYPED: 02/08/01 HB
SHORT TITLE: Increase Fire Protection Fund Distributions SB 21
ANALYST: Valenzuela




APPROPRIATION



Appropriation Contained
Estimated Additional Impact
Recurring

or Non-Rec

Fund

Affected

FY01 FY02 FY01 FY02

See Narrative



(Parenthesis ( ) Indicate Expenditure Decreases)





REVENUE



Estimated Revenue
Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY01 FY02
$ (3,100.0) Recurring General Fund



(Parenthesis ( ) Indicate Revenue Decreases)



SOURCES OF INFORMATION



LFC Files

Office of the State Fire Marshal



SUMMARY



Synopsis of Bill



Senate Bill 21 amends the "Fire Protection Fund Law" to increase the distributions to qualifying main station and substation fire districts by approximately 20 percent. The bill also makes minor technical corrections.



Significant Issues



The Fire Protection Fund law identifies the funding formula for making distributions to fire districts from the Fire Protection Fund. The Fund was created to pay for the operating expenses of both the State Fire Marshal's Office and for the State Firefighter Training Academy, as well as the distributions made to the fire districts. The law also defines the criteria for counties and municipalities to meet in order to receive state funding.



FISCAL IMPLICATIONS



Fire districts have argued for a larger distribution from the Fund for a number of years. Over the past 10 years, the annual distributions to fire districts have averaged $12.8 million. Although, in 1999, the distribution total increased over the 1998 level by 10.8 percent and has remained near this amount (Attachment 1). Senate Bill 21 would increase the distribution by 20 percent to $18.6 million. However, the distributions have increased as a percentage of total funds. From 1994 to 1998, the distribution percent fell to below 40 percent (Attachment 2).



Enactment of Senate Bill 21 would have a negative fiscal impact on the general fund because any amounts remaining in the fund, after distributions, revert to the general fund. The 20 percent increase in the distribution could cost $3.1 million, based on an average distribution of $15.5 million annually.



ADMINISTRATIVE IMPLICATIONS



Enactment of Senate Bill 21 would have only a minor administrative impact on the State Fire Marshal's Office.



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