COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. No.:         4003-01

Bill No.:          HB 1508

Subject:           Economic Development; Business and Commerce

Type:              Original

Date:               February 8, 2008

Bill Summary:            This proposal establishes the Economic Development Grant Program for companies to reopen a closed manufacturing factory.

FISCAL SUMMARY

Numbers within parentheses: ( ) indicate costs or losses.

This fiscal note contains 4 pages.

☐ Estimated Total Net Effect on All funds expected to exceed $100,000 savings or (cost).

☒ Estimated Net Effect on General Revenue Fund expected to exceed $100,000 (cost).

FISCAL ANALYSIS

ASSUMPTION

Officials from the Office of the Secretary of State (SOS) state many bills considered by the General Assembly include provisions allowing or requiring agencies to submit rules and regulations to implement the act. The SOS is provided with core funding to handle a certain amount of normal activity resulting from each year’s legislative session. The fiscal impact for this fiscal note to Secretary of State’s office for Administrative Rules is less than $2,500. The Secretary of State’s office recognizes that this is a small amount and does not expect that additional funding would be required to meet these costs. However, we also recognize that many such bills may be passed by the General Assembly in a given year and that collectively the costs may be in excess of what our office can sustain with our core budget. Therefore, we reserve the right to request funding for the cost of supporting administrative rules requirements should the need arise based on a review of the finally approved bills signed by the governor.

Officials from the Department of Economic Development (DED) assume an unknown need for people and associated costs to administer the program. The bill authorizes an economic development grant program to be administered by DED with funds appropriated by the legislature. There will be impact if funding is made available but the impact is unknown as the amount appropriated for the program will determine the amount of work.

Oversight will reflect an unknown amount of grants given by DED, as well as an unknown amount of administrative costs incurred by DED. Oversight assumes this amount would be over $100,000.

FISCAL IMPACT - Small Business

Small businesses that qualify to receive the grants would be positively impacted by the proposal.

FISCAL DESCRIPTION

This proposal establishes the Economic Development Grant Program to be administered by the Department of Economic Development. Moneys deposited into the grant program from state appropriations or any gifts, bequests, or donations will be used by a company to reopen a manufacturing factory that has been closed. The department will develop a procedure for a company to apply for the grant.

The provisions of the bill will expire six years from the effective date.

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 the Secretary of State

Department of Economic Development

                                                                                                Mickey Wilson, CPA

                                                                                                Director

                                                                                                February 8, 2008