Texas Parks and Wildlife Commission
August 26, 2009Texas Parks and Wildlife Commission
Finance Committee Meeting
Amon G. Carter Jr. Exhibits Hall
Will Rogers Memorial Center
Fort Worth, Tarrant County, Texas
BE IT REMEMBERED, that heretofore on the 26th day of August, 2009, there came to be heard matters under the regulatory authority of the Texas Parks and Wildlife Commission in the Cactus Room of the Will Rogers Memorial Center, to wit:
THE TEXAS PARKS AND WILDLIFE COMMISSION:
- Antonio Falcon, MD, Rio Grande City, Texas, Committee Chairman
- Peter M. Holt, San Antonio, Texas, Chairman
- Mark E. Bivins, Amarillo, Texas
- Ralph H. Duggins, Fort Worth, Texas
- T. Dan Friedkin, Houston, Texas
- Karen J. Hixon, San Antonio, Texas
- Dan Allen Hughes, Jr., Beeville, Texas
- Margaret Martin, Boerne, Texas
- S. Reed Morian, Houston, Texas
THE TEXAS PARKS AND WILDLIFE DEPARTMENT:
- Carter P. Smith, Executive Director, and other personnel of the Texas Parks and Wildlife Department
P R O C E E D I N G S
COMMISSIONER HOLT: Next we will move into the Finance Committee. And we have a new Finance Chair.
Dr. Falcon, you are on, Buddy.
COMMISSIONER FALCON: Thank you, sir. The first order of business is the approval of the minutes from the previous committee meetings that were held on the 27th of May and the 22nd of July. And they have already been distributed. Is there a motion for approval?
COMMISSIONER BIVINS: So moved.
COMMISSIONER FRIEDKIN: Second.
COMMISSIONER FALCON: Bivins and Friedkin. Yes. All in favor say aye.
(A chorus of ayes.)
COMMISSIONER FALCON: Opposed?
COMMISSIONER FALCON: All right. The first committee item is an update on the Texas Parks and Wildlife Department progress in implementing the Texas Parks and Wildlife Department Land and Water Resource Conservation and Recreation Plan. Mr. Smith.
MR. SMITH: Chairman, thank you. And just a couple of items that I want to cover this morning. One, as you will recall, back in May, the Commission approved a series of changes to our fee structure with our various licenses. There were a couple of omissions that we need to go back and rectify and have your permission to initiate rulemaking.
One, we neglected to include the proposed fees for the resident and non-resident paddle craft, all water guide license. That is a $250 fee. So we would like to go back out and initiate rulemaking for that. Also I believe we had proposed a fee change to the marine dealer, distributor and manufacturer's license. That is actually set in statute at $500. And there is no ability to change that fee. So we need to make sure that we rectify that. So with your concurrence, we would like to go out and initiate rulemaking on that.
The second matter that I just wanted to remind everybody, August 15th marked our new license year for folks to be able to buy licenses for the upcoming season. I hope you purchased yours. Obviously, there is a lot of changes in place. And I thought I might just give you an update on what is happening with lifetime license sales.
As you all, I think, are aware, we are increasing the lifetime hunting and fishing license fee from $1,000 to $800 or if you just want to buy a lifetime fishing or hunting license, it was or is, through August 31st, $600 for one of those. We are raising it to $1,000. There has been, suffice it to say, a lot of interest by our stakeholders out there, in making sure that they have the ability to take advantage of the current price.
Just to give you some quick statistics. Last year, we sold 1,672 lifetime licenses. We expect to sell 6,000 by the end of August. We are having 200 to 300 applications come in a day. And by the end of the month, we expect those lifetime license sales to generate about $6 million to go into the endowment. So people are definitely taking advantage of the opportunity now.
I do want to make sure everybody is aware. We have told everybody very emphatically, that the deadline to get their application in, to purchase the new licenses, is close of business on August 31st. So I will say that again publicly. Close of business, August 31st, five o'clock. And we are hoping that everybody will meet that deadline. So, I thought you would be interested in it.
COMMISSIONER BIVINS: What is the new combo?
MR. SMITH: The new combo will be $1,800.
COMMISSIONER BIVINS: $1,800. Okay. I didn't understand that.
MR. SMITH: Yes. And that will go into effect after August 31st. So overall, license sales look pretty good. You know, we are up 3 or 4 percent compared to last year. We will have a much better feel for how it is going to really go after Labor Day, when we get a big spike for dove season. So we will keep you apprised as the year goes by.
Good news, I think, in addition to the lifetime license sales here at the end of the year that have been very, very strong for obvious reasons. We have actually mostly caught up with where we were the year prior. As you will recall, we started this fiscal year in a bad situation with the impacts from Hurricane Ike and so we had a whole group of the public that were just not buying licenses. And really, through September and October, we were as much as 15 to 20 percent down for prior years. And we have made up a lot of ground, and we are going to finish strongly. So that is good news, in terms of folks getting out there, and hunting and fishing. COMMISSIONER BIVINS: One other question, and this may not be the time to address this, but we are addressing the issue of tag issuance to lifetime license holders?
MR. SMITH: We are, for individuals that want a preference for us to mail their tags to them as part of that, then they can let us know that. There is a form that they can download from the website and fill that out. It is interesting, in talking with Gene, you know, we have some lifetime license buyers that are absolutely wedded to go into Academy and doing it themselves, don't want us to send them the tags, because it just confuses them. And then we have some that feel very strongly that we ought to mail them the tags as part of their lifetime licenses so we are going to let folks have that option, and there is a form which they can download and give us that guidance. So our license team has worked hard to try to address that.
COMMISSIONER BIVINS: Thank you.
MR. SMITH: So Mr. Chairman, I think that concludes my remarks.
COMMISSIONER FALCON: Very good. Thank you.
Committee Item Number 2. Financial Overview. Mr. Jensen.
MR. JENSEN: Good morning, Commissioners. It is a pleasure to be here. I am going to go over a couple of things this morning with you. We are going to go over fiscal year 2009. We are going to first talk about some of the things that Carter just addressed; the revenues that have been coming in, state park fees and license fees and boating. And then we are going to look at an overall budget status for fiscal year 2009 and then we will move on to fiscal year 2010, which starts on September 1st — the operating budget — and we will go over the capital budget as well. And we have two small policy discussion items. They are not major changes. Each fiscal year the Commission approves the budget policy and the investment policy. We have a couple of small changes to each, and we will address those when we get to those slides.
From the standpoint of state park receipts, I think the Agency is doing quite well. I attended the Commission meeting before I was hired back in May. And I noticed that there were some gaps. And we have been pretty much on par with the National Parks Service as well. In speaking with Walt Dabney a couple of weeks ago, we are up significantly on state park passes and entrance fees and donations, but much like the National Parks Service, we are down on concessions.
Overall, receipts are up 1.9 percent or $663,000. And I have to point out that this is actually a very good year, if you consider that Galveston and down there along the coastline, there hasn't been as much revenue. In fact, there is approximately a million dollars worth of revenue had those operations not been impacted. So you would have seen $36 million this fiscal year had those — that Hurricane Ike not impacted their operations.
Boat revenue, I need to make a correction on the slide. The revenue is down actually by 3.81 percent, which is $738,000. Overall, the registrations themselves are doing fine this fiscal year as compared to last year. It is actually .3 percent better this fiscal year than last year. Where we are losing traction is on the sales tax. It is approximately 23 percent down when you compare it to last year, on the sales tax. And the titles are approximately 4 percent down when you compare it to last year. But if you look at how we compare to the first quarter of this fiscal year, we are actually about 16, 17 percent behind. So the Commission has been gaining traction to get it down to 3.81 percent through July. I imagine that we will even narrow that gap, when we get through August 31st. We get these reports internally, once a month. So the next report is going to be due pretty soon. So I imagine the revenue down is going to shrink when we get through the end of the fiscal year in August.
Mr. Smith, kind of walked you through the highlights of the license sales and revenue of what is going on. These figures are as of July 31st, but I also have the figures for you through August 19th.
When we compare this fiscal year to last fiscal year through July, we were significantly down when you look at non-resident hunting licenses. We were about 14 percent down. And that is still through August 19th, about 14 percent down. But we have been up on non-resident fishing licenses. Through July, it is about 1.3 percent up. Through mid-August, it is about 1.5 percent up. The difference between July 31st and through August 19th, here we are looking at a negative .6 percent. Through August 19th, we are looking at a 1.13 increase. It is positive. COMMISSIONER HOLT: Wonderful.
MR. JENSEN: We have gone over, and we are no longer in the red. I think this is significant when you look back through September and October. We were, in September, negative 10 percent when you compared, and then slowly we have been reducing that negative amount, and finally, we were at 1.13 percent above.
This represents the number of licenses sold. It correlates also with revenue, but it is not directly. It is a real close correlation, but you can see that we are up almost 1 percent on the number of licenses that we have sold overall. However, if you look at the breakdown of category, we are slightly down in hunting licenses, about 1.2 percent. We are slightly down in fishing licenses at six-tenths of a percent, and the total combos were down through July 31st. However, Carter Smith has just reported that there has been a significant spike because of the lifetime sales. Through July, the lifetime sales were positive, when you compared it to last year, 8.8 percent. But if you look through August 19th, that is 9.4 percent, but the sales we are going to have through the end of August 31st, we are probably going to put that up past 10, maybe 11 percent. And this is similar to the revenue, when we started the year we were not comparing favorably with fiscal year 2008. And we will compare relatively favorable. We will be positive about 1.25, 1.27 percent, at least through August 19th.
This next slide, I am going to kind of tie it back to the revenue that Carter had already mentioned. Because when we look at the other, on this slide, it says that the revenue estimate is $4.4 million, and through July 31st, we have collected 5.9.
Carter just reported to you that just from the lifetime license sales themselves that are part of the other category, last year, we sold 1,672 licenses for 1.4 million. So far this year, we have sold 5,045 for 4.6. And the estimate is just for lifetime licenses themselves, the actual revenue is going to be about $6 million.
There are some other components in the other down here, and that 4.4, we also have 1.1 million donation from TPW Foundation. So we are doing well, 134 percent. By August 31, it is going to be even much, much better than 134 percent. If we go back up to the top, the first category, game fish and water safety, most of you refer to this one as Fund 9. We are doing well on that one, but I would have to point out that most of this is due to a $4 million donation for the Game Warden Academy. Fund 9 itself is rather tight with respect to cash flow. State Park Fund is looking good.
COMMISSIONER HOLT: Can I stop you? A $4 million donation to the new Game Warden Academy? Would be in revenue?
MR. JENSEN: That is included in that amount.
COMMISSIONER HOLT: Help me on that one.
MR. SMITH: Well, there is a donation that comes in to the Foundation that, ultimately, it is transferred over to the Department for the Department to use. So it hits our books. It was outside of our books when it came into the Foundation.
COMMISSIONER HOLT: So as you are using it, then it is considered revenue? I mean —
MR. SMITH: Do you want to speak to how we handle that?
COMMISSIONER HOLT: Yes. Somebody walk me through that one, just so I understand how it works.
MR. SMITH: Yes.
MR. MCCARTY: Yes. Donations of any sort are booked as revenue in one way or another, whether it be through appropriated receipts or through, in this particular case, that particular donation came directly into Fund 9. Now that was a donation that came into Fund 9, and directly went into capital construction initiative for the Game Warden Academy. So those were the funds that were collected by the Parks and Wildlife Foundation for the construction transferred to the Agency, were brought in and booked as revenue to Fund 9 and then expended through Fund 9.
COMMISSIONER HOLT: Right. You say all donations are considered revenue?
MR. MCCARTY: Yes, sir. They are booked as revenue.
COMMISSIONER HOLT: They are booked as revenue? Okay.
MR. MCCARTY: In some form.
COMMISSIONER HOLT: I have been here five years, and didn't realize that. Okay.
COMMISSIONER FRIEDKIN: You are kind of trying to get a sense of operating revenue compared to previous years. So you are isolating —
COMMISSIONER HOLT: Yes. And we can break that down later. It is not important to that. But I just didn't — I don't think I understood how donations were.
COMMISSIONER FRIEDKIN: Yes. I agree.
COMMISSIONER HOLT: Okay.
MR. JENSEN: For the record, that is my boss, Gene McCarty. Okay, the one that kind of sticks out is the Local Park Fund. And the reason that is a little bit low is because the method that they had us book $2 million in federal funds, rather than putting it in the Local Park Fund where we had anticipated, we got instructions from the Comptroller's Office to put it in the Land and Water Conservation Fund which is a different fund, which impacted the percentage there.
COMMISSIONER HOLT: Wait. Can you back up. I guess, can you walk us through why? Why would we be told by the Comptroller where to put this kind of money? And then can we then spend them for what we want to spend them for, relative to the Local Park Fund? Maybe I am asking a question — I am throwing it out for somebody to answer the question.
MR. JENSEN: I think the right staff person is back in Austin. Lance is the budget director. But we have a staff person who does analysis on the revenues. I will have to get back with you specifically on that one.
COMMISSIONER HOLT: Yes. Get back with me. Okay. That would be fine.
MR. JENSEN: Let me note it.
COMMISSIONER HOLT: Please.
MR. JENSEN: For the current fiscal year, there has been a number of budget adjustments that have taken place. Kind of walk, I can't — I don't know how big this is on your screen, but you have them in your books. So I will just walk through them fairly quickly. The adjusted budget as of March 31st of $470 million, and we had a Supplemental Appropriations Bill, House Bill 4586, which appropriated $16 million. And basically, a big chunk of that was related to Hurricane Ike. And there was another $1 million that was a pass-through to the Texas State Railroad Authority. And then there was another million that was related to data consolidation; the statewide contract for information technology.
The federal grants line item is $8.4 million in adjustments. The majority of that amount is a NOAA grant that is currently in Coastal Fisheries budget, about $5 million. There is donations of $128,000, a couple of interagency contracts that net to $11,800. And appropriated receipts of $119,000. We have rider provisions which deal with a number of different things, from license plates to some land sale proceeds which are $990,000.
We have unexpended balances of $2.7 million. The biggest chunk of that is related toward the artificial reef: $2.2 million. And we have a small amount for employment and fringe benefits. So the adjusted budget as of June 30th is $498 million. And we are in the process of finalizing the monthly financial report through the end of July. You will probably get that late this week, or early next week.
Through July, there is going to be another adjustment; these are only through June 30th. The July adjustment is going to include the Battleship Texas Bond, $25 million. So that 498 will be increased at the end of July by $25 million.
This slide provides a summary by object of expense. And it kind of rolls up a number of types into operating equipment. But you can see that pretty much on task with respect to — we had 17 percent of the year remaining, and 39 percent of the total is available, but I need to point out that the line item for grants, the month of August, the local grants are allocated. So most of that balance that is available in grants will probably be sent out in the form of local grants.
And the capital projects, I believe it has been explained that there is a long life cycle with respect to the capital. So some of that is going to be UB'd — you will see that in some of the other slides. With respect to salaries, and operating, it looks like we are on track.
I also need to — I found out today that in addition to the Battleship that is going to increase the budget, that the Battleship Foundation is also going to provide another $2 million. So the 498 is going to increase by 25, plus that 2. So it will increase by 27 at the end of July.
I am going to move forward to the fiscal year 2010 operating and capital budget. These slides are going to go through the operating. It will go through the capital items. It will also kind of summarize the Appropriations Bill, the exceptional items. And it will talk about the FTEs that are allocated, and the FTE cap.
When this budget was created, we used the Appropriations Bill as a starting point, and we wanted to establish the base budgets close to what the base was for fiscal year 2009. Then we looked at the exceptional item requests that were approved by the Legislature and made those allocations as appropriate. A number of the divisions are indirect support divisions. For example, administrative resources, communications, legal services, those are split-funded divisions between Fund 9 and Fund 64. So we have a methodology that is sound, that we use at the beginning of each fiscal year to allocate the funding for those divisions. And we made sure that the budget allocations had to match the available cash that was in the projected forecast. And all capital items were budgeted at 100 percent.
This kind of tracks the first couple of bullets that were on the prior slides. We start with the General Appropriations Act. It is Senate Bill 1 and House Bill 1. And that gives us the authority to spend by strategy and by fund for the Department. And then we looked to Articles 9 and Article 12. Article 9 in the Appropriations Bill applies to all state agencies, and most institutions of higher education.
We had a couple of items in Article 9 relevant to the Department. We had the Schedule C salary increase, which is for law enforcement. There is $1.4 million that was appropriated to the Agency in Article 9 relative to that. And there was a small amount for a conservation license, approximately $25,000.
Article 12 is what you probably heard referred to as the ARRA or the stimulus section of the Appropriations Bill. We did have a $1.7 million amount that was allocated for us, should the funds become available. The funding source was the Byrne Justice grants. Initially early on, we were under the impression that we might not get anything. But there was a letter recently sent to the Legislative Budget Board from Steve McCraw indicating that the Department will probably get at least $500,000. We are waiting to get a copy of that letter. But our understanding, from our analyst at the LBB is that it will be used to purchase river boats. It was part of the initial $1.2 million that was requested.
We have an increase to our FTE caps, to 3,178.3 in 2010. This also provides an additional — the first line that you will see on your printed slide on your presentation is Article 6. That is what is in the Appropriations Bill for Texas Parks and Wildlife Department. Article 9 includes what I mentioned before; the law enforcement Schedule C increase, and a couple of other things.
Article 12, the $1.7 million is the stimulus funding. We probably won't materialize that 1.7, but we will probably get at least $500,000. Some of the adjustments that we have made, most of these adjustments would be handled probably through supplementals. Appropriated receipts of $716,000. We have federal funds of $3.1 million. Interagency contracts of $61,000 and we have mentioned earlier House Bill 4586 was the Supplemental Appropriations Bill. A big piece of that was related to Hurricane Ike and it is in the capital object of expense. And capital can be UB'd forward unexpended balances. So this is a piece of the capital that was allocated in 2009, which will be moved into 2010. And we also have the Battleship Bond UB of $25 million. And the last line item down there is fringe benefits, and benefit replacement pay of $40.5 million. This gives us a grand total budget of $468.8 million for 2010.
There were a number of exceptional items. I have two slides that we will present, that cover all of those.
We had a salary equity, total compensation that was the exceptional item number 1, that you, Commissioners and executive management, were successful in obtaining for the Agency. When you see the bill that all the people talk about a biennial total, they will talk about $11.2 million. But basically, the Rider 27 amount in one fiscal year is 5.1 and if that is allocated out to salaries, then you have to continue with that level in the second year because these are base salary increases.
We had some exceptional items that allowed $28 million in statewide capital repairs for construction. And earlier this morning you had a presentation on aquatic vegetation. We had an exceptional item that allowed $750,000 this fiscal year specifically for aquatic vegetation.
There up in the Panhandle, I believe this was addressed in the last Commission meeting. There is funding, it is about half of what we requested for off-road vehicle recreation site.
There is another $820,000 for state park fiscal controls. And $1.5 million for IT data center. And this is in addition to the $1 million that was in the Supplemental Appropriations Bill. And that indicates, should indicate to you, Commissioners, that our IT Department historically has done a great job, that the state contract, if it is saving money, it is saving money at other agencies and not at ours.
Land acquisition development, the $9.3 million, this is related to the Eagle Mountain Lake land sale. The last item on this slide is Governor's Border Security Initiative that is $825,000 for 15 new game wardens along the Border, the land border.
We have Rider 27 for state park seasonals, $386,000 as an exceptional item that was approved. Off-highway vehicle decal receipts of $368,000. We had state park weather-related damages, primarily related to the hurricane, $10 million. A small technical adjustment for license plates of $137,000. And I've mentioned before, the Schedule C salary increase, Schedule C is for our Law Enforcement Division, $1.4 million. And at the last Commission meeting, I believe there was a discussion about the Bexar County special needs park. There was $5.5 million for that, as an exceptional item. And then another $25,000 approximately for marine conservation plates.
This pie chart summarizes a method of finance for the Department. The General Revenue amount up here of $136.3 million, it is inclusive of the sporting goods sales tax, which ultimately gets transferred to Account 64. The sporting goods sales tax, of that $136 million in general revenue is $74.8 million of that GR amount.
This slide shows the budget by object of expense. And as with typical of most state agencies the largest object of expense items are going to be your salaries and personnel costs. And for our department, the capital budget is large, because of the bond issuances that are out there to renovate and upgrade the parks. Salaries is $146.3 million, operating $76.3 million, grants is $39.7 million, benefits is $40.5 million, the capital budget is $158.5 million, and debt service is budgeted at $7.5 million.
The next two slides will show you the breakdown in the budget by division. We will go through this relatively quickly. You have $9.3 million in administrative resources, 19.2 in Coastal Fisheries. Communications, 9.6, department-wide has its own slide and we will get to the details of that in a moment, $25.4 million, Executive administration, 2.9, Human Resources $2.1 million, Information technology, 14.6. Infrastructure, $7.8 million, Inland Fisheries $19.1 million, Law Enforcement, $60.4 million, Legal $1 million, State parks, 92.1, Local parks, 28.6, Wildlife, 28.9, and capital construction is $123.8 million. And capital and land acquisitions, 11.4 and the GLO transfer is $12.6 million.
One comment that I do have on the GLO transfer, just to let you Commissioners know, is the Department receives its allocation of sporting goods sales tax on a monthly basis. So we have agreed with the GLO through MOU to pay them installments rather than up-front, because of the cash flow consequences. We don't have all the cash up front as of September, so they will get half of that transfer by September 15th. They will get the second half of that transfer by December 15th.
MR. SMITH: Mike, we have got a couple of new Commissioners.
COMMISSIONER HOLT: You might explain.
MR. SMITH: Yes. The GLO transfer has to do with funds that are dedicated for GLO for coastal erosion and protection. And so that approximately $25 million over the biennium then goes to a fund there, the Coastal Erosion Program, along the coast. We simply serve as a pass-through entity through those funds. And so that is what Mike is referring to. So I wanted you to know what those GLO funds were being used for.
MR. JENSEN: I mentioned a moment ago that we had specifics on the department-wide budget. Department-wide budget is where we allocate the funds that impact overall operations or have an impact on all the divisions together. We also budget in this group, the debt service payments. We have $4.7 million allocated for construction capital items. These will be projects that will be determined specifically for during that fiscal year.
The next two line items on here relate to the license structure. We have payments to licensed agents, such as the Academy and the WalMarts that sell the licenses. The licenses themselves, the Verizon system, we allocate $3 million. We have a State Office of Risk Management Assessment that is due at the beginning of the fiscal year. And that relates to workers compensation. And they adjust that twice a year. But the first payment is due in September. The Airport Commerce Park, that amount is for rent at the new facility, which is close to the headquarters in Austin. And then there is $1.1 million in the general budget. And that consists of $974,000 of set-aside Fund 9 authority, $165,000 of ED reserve.
The Oracle Project, you have probably heard that referred to as BIS, the Business Information Systems project. We are hoping that will be successfully implemented, not this September but next September, so we have 12 months to get it there. $200,000 in claims and settlement, and these four riders, we have $3.3 million. And those relate to license plates, aquatic vegetative management, and off-highway vehicle trail recreational program area funds, and $64,000 for the motor pool.
As you can see from the presentation, the capital budget is significant. It is fairly large. We have 50.35 that is already in the budget, and then we are going to UB 77.27 for a total of 127.62 for construction and major repair. The 50.35, the breakdown of that is $3.8 million is Fund 9, $5.8 million is freshwater fish stamp, $2.2 million is federal sport fish. $28 million is Proposition 4 bonding and $10 million is weather-related bonds. Then there is another $495,000 that is related to the Canadian River Corridor.
The $77.27 million that is up there is broken down by $38.2 million in the Legislative Appropriation Request as a UB amount, and we have $25 million that is related to the Battleship Bonds, and $14 million of 2009 GR Supplemental. As I mentioned, a big chunk of what we got in the 2009 Supplemental Appropriations Bill was capital; $12 million for natural disasters, and $2 million for Sea Rim.
And the next largest item is the transportation item of $7.57 million. That is broken down, $6.37 million in Rider 2. Rider 2 when you open up our Appropriations Bill in Section 6, is our capital authority rider. It is right after Rider 1, which is our performance measure rider. We also have, out of that 7.57, $1.2 million that we were planning from the stimulus monies. So that amount might be reduced if it doesn't materialize. We are pretty sure that we are going to get the $500,000, but we may not get the 1.2.
In 2009, our legislative FTE cap was 3,100.1. And we budgeted 3,220.1 and each division has done a great job in managing its vacancy rates. We budget higher than the FTE cap, knowing that there is going to be vacancies throughout the year. And we manage that to come as close to the FTE cap without exceeding it, as possible. That maximizes the use of funds.
In 2010, the cap is going to increase to 3,178.3 and we are budgeting FTEs at 3,296. What that means is, that across the board, it doesn't necessarily mean that it is going to happen across the board but we have to have it. We are assuming a vacancy rate of approximately 4 percent, which may be kind of tight. But historically, before the economy went bad, we were about 11 percent. More recently, it is about 7 percent. So we will have to manage that closely.
The next two slides break down the number of FTEs by division. Administrative resources has 138, Coastal Fisheries 201, Communications 85, Executive Office 32, Human Resources 27-1/2. Information Technology 93, and Infrastructure 137, Inland Fisheries 225, Law Enforcement 657-1/2, Legal is 11-1/2, and a majority, a big chunk in State Parks is 1,352, Local Parks 17, Wildlife is 319.5.
I had mentioned earlier that we have two policies that are approved by the Commission each year. The first policy that we are going to address is going to be the budget policy. It has two small changes, really. At the bottom of it, of the first paragraph, after Item 13, in the section about donations, we changed one word. The word used to be "and"; now it says "or." It now allows approval of the donation list by the Finance Committee Chair or Chairman Holt. In the past, it was and. It had to have both.
And we added a new sentence. And the new sentence relates to what I have as the first two items on the slide. And that sentence pretty much allows the Commission to use any appropriated funds as permitted by statute or rule. I believe in the past, there have been some informal segregation of funds that weren't required by statute or rule. Specifically, for example, the buyback funds. What we are wanting to be able to do with those funds is to use them for any purpose that the law allows them to be used for and not limit their use. That is what that one sentence at the bottom of the policy is attempting to do.
The last bullet just points out that donations or gifts exceeding $500,000, they are approved monthly at the Commission meeting. And Chairman Holt or Chairman Falcon can now approve those.
The investment policy, these were really a couple of small changes. What are on these slides are basically this slide shows how the policy has always operated. All of our funds are required to be deposited in the State Treasury except Operation Game Thief funds, Texas Park Development Fund Lifetime Endowment Account. The old policy used to include the Varner Hogg-State Park Trust Account, but that is no longer our responsibility; it was moved to the Texas Historical Commission.
We made one small change in Section 2, Letter C of that policy. It was talking about an escrow account. It used to refer to a rider that mentioned goods and services. But you really don't have an escrow account for goods and services, so we removed that reference.
And the investment policy, bank accounts must be authorized by the delegated investment officer, and properly collateralized. And I already mentioned the Varner-Hogg State Park Trust Account has been sent to THC. And quarterly and other reporting are required.
And tomorrow, this recommendation we will ask in the main body of the meeting that you consider this motion tomorrow. If you have any questions, I would be happy to try and answer them. And I will get back with you, Chairman Holt on that other thing, when I can make a phone call.
COMMISSIONER HOLT: Yes. Whenever you get a chance. That will be fine. Thanks.
MR. MCCARTY: For the record, Gene McCarty, Deputy Executive Director for Administration. Chairman, let me answer your question concerning the federal funds, depositing federal funds into Fund 64. With any new elected official, you get — they have a tendency to go through and look at the statutes, and make sure that their agencies' interpretations of the statutes are correct. And in this particular case, the Comptroller, the new Comptroller looked through all the statutes, and made the determination that what we had been given previous authority which was to deposit federal funds into Fund 64, that we did no longer — that we did not have that authority, that authority, that interpretation by the previous Comptroller was wrong.
So they said, you can't deposit these federal funds into Fund 64 any longer. You can deposit them into the capital account. That doesn't necessarily hurt us any, because the capital account, the authority at the capital account is actually broader than the authority of Fund 64. However, through the Sunset process, we actually fixed that problem. This was brought to us back during the legislative session. And we actually fixed that problem by making a change to the statute, and allowing federal funds to be deposited into Fund 64. So, while the interpretation of the Comptroller earlier this year caused us to put those land and water funds into the capital account, we don't have to do that after September 1st. We can go back to our previous — the way we were doing it previously, because we made a change through Sunset statute.
COMMISSIONER HOLT: And you don't have as broad authority.
MR. MCCARTY: Well, these particular land and water funds are specifically for state parks.
COMMISSIONER HOLT: I thought they were. Okay. So in other words, you ended up back where you started.
MR. MCCARTY: Yes. We ended up back where we were by changing the statute through Sunset.
COMMISSIONER HOLT: Yes. I just didn't want to lose the $2 million, which is the way I took it.
MR. MCCARTY: No. We are depositing those into the capital account, which can be used broadly for almost any of the Agency's activities.
COMMISSIONER HOLT: Good. Fair enough. Thank you, sir.
MR. JENSEN: Any other questions?
COMMISSIONER FALCON: Any questions or discussion by the Commission?
COMMISSIONER FALCON: I am going to ask that this item be placed on the Thursday Commission meeting agenda for public comments and action.
Committee Item Number 3 is the FY 2010 and 2011 General Obligation Bond Program. The New Bond Proceeds for Facility Repairs. Rich.
MR. McMONAGLE: Good morning, Mr. Chairman, Commissioners. My name is Rich McMonagle. I am the Director of the Infrastructure Division. I actually have the next two items, which are each resolutions for us to pursue the funding for the General Obligation Bonds that were authorized by the 81st Legislature.
So on the first item, it is to pursue funding for $28 million for facilities repairs. Exhibit B is our current list of those repairs. And you will notice that there is quite a disclaimer at the top and bottom of each of those, and I would like to take an opportunity to talk a little bit about our project lists, as an introduction for our new Commissioners as well as to review for others.
The disclaimer well stresses that our lists are not static. This list was prepared originally over a year ago as part of our Legislative Appropriation Request. And this list will continue in effect for the five-year life of these bonds. So as one would expect, over the life of this, there will be natural and manmade events that will cause changes in our needs and our priorities. This list was prepared originally as I said, over a year ago. Since then, Hurricane Ike has happened. This is a striking example, maybe an extreme example of what can happen during the life of a list. Hurricane Ike of course, created new needs for us. It changed many of the projects that were already on the list. Of course, it negated some needs. It is hard to fix a restroom when the restroom has been washed out to sea.
So, although that is a dramatic effect of the dynamic nature of our list, throughout the time, this will continue to change, and we will continue to stress to not only the Commission, but especially to the legislators that our lists are subject to change. This list also represents a change in approach for the Department. Previous to this last legislative session, we used to expend a great deal of effort trying to attach a number figure to the backlog of maintenance that we have. And we have often cited, $200 million, $500 million. The way we came up with that, was looking at all the needs, the thousands of needs in the system and trying to add those all together. The problem with that is, is that many of those needs were written by the man on the scene, who didn't necessarily have any experience or training in estimation techniques. So what would happen is we would go before the Legislature and they would begin to delve into the individual items and the whole thing would fall apart.
In 2008, the Department commissioned a comprehensive study of the state park system. And one small part of that was a recommendation that we change that process. And they recommended instead that we adopt a best practice by a number of state and other park systems, where instead, they invest a percentage, normally, about 4 to 6 percent of the asset value in maintenance and repair. And that is asset value, not including land value. So that study recommended that we invest the smaller amount, 4 percent of a very conservative estimate of $800 million in value to say that we really should be investing about $32 million a year in repairs and maintenance. And that of course, is just for the state parks, which is what that study was. That doesn't include all the other facilities we have.
So between this item and the next item, you will see that the Legislature gave us $38 million over the biennium. You can see that despite how many hundreds of millions of dollars behind we are, each year, we are continuing to fall behind. Over the last number of years, we have done about $20 million worth of repairs and maintenance. So what the legislators have given us is certainly within our capability, but continues to fall short of our needs.
So with that, the staff recommends the Texas Parks and Wildlife Commission adopt the following motion; Texas Parks and Wildlife Commission adopts by resolution the resolution authorizing the request for financing in the execution and delivery of documents required to effect such financing. Are there any questions?
COMMISSIONER FALCON: Any discussion by the Commission?
COMMISSIONER FALCON: Chairman? I ask that this item be placed on the Thursday Commission meeting agenda for public comment and action. I want to go on to the next item, Item Number 4, which is the General Obligation Bond Program. New bond proceeds for weather-related damage repairs.
MR. McMONAGLE: Again, my name is Rich McMonagle. I am the Director of the Infrastructure Division. This item deals with the resolution that we request funding for general obligation bonds in the amount of $10 million for weather-related damages. This one is much easier, because although all our other lists are subject to change, this one isn't, because the Legislature specifically told us the three projects in Exhibit B that we are to do. And to correct the previous speaker, these were not Hurricane Ike-related; they were flood-related damages and repairs. So with that, the staff recommends that the Texas Parks and Wildlife Commission adopt the following motion: Texas Parks and Wildlife Commission adopts by resolution the resolution authorizing a request for financing and the execution and delivery of documents required to effect such financing. Are there any questions?
COMMISSIONER FALCON: Any discussion by the Commission?
COMMISSIONER FALCON: I want to ask that this item be placed on the Thursday Commission meeting agenda for public comment and action.
MR. McMONAGLE: Thank you.
COMMISSIONER FALCON: Mr. Chairman, the committee has finished its work for the day.
COMMISSIONER HOLT: All right. You moved it along very quickly. We appreciate that. Okay. This committee is convened to —
COMMISSIONER FALCON: Oh, no, I didn't.
COMMISSIONER HOLT: Sorry.
COMMISSIONER FALCON: One more item, yes.
COMMISSIONER HOLT: See, you were trying to get out of this quickly, didn't you?
COMMISSIONER FALCON: Yes. I am sorry.
COMMISSIONER HOLT: I like the attitude.
COMMISSIONER MARTIN: Yes.
COMMISSIONER FALCON: The fifth item had not so much to do with money, but yes it does. A resolution recommending adoption of non-profit partners. Ms. Bright.
MS. BRIGHT: I am Ann Bright, General Counsel. And I won't take it personally. I am here to present this item. We do this once a year, where we update the list of non-profit partners. And, as a little background, back as part of the 2001 Sunset, the Legislature wanted the Department to keep a really good list of all the non-profit partners that we work with, and we do work with a number of non-profit partners.
So we select, the Commission selects and cooperates, and then as required by statute, the list is approved by the Commission. We have actually categorized our non-profit partners into two groups. The general non-profit partners are really just folks that work with us on a day-to-day basis. Ducks Unlimited, you can think of a number of organizations that work with us, and that was just one that kind of came to mind.
Closely related non-profit partner, is really — these are our friends groups. These are the people that are usually associated with a very specific site. One other thing that I would like to point out is under the legislation, all of these entities are required to be non-profits under 501(c)(3), or just (c), 501(c) of the Internal Revenue Code. So if somebody is an unincorporated association or a governmental body, they really don't qualify.
One of the things that we have been doing over the last few years is, we have really tried to go back and sort of scrub our list to make sure that the entities on there really do fit the criteria. So these are the general non-profit partners that we would like to add to the list. Alamo Area Chapter of Quail Unlimited, Austin Woods and Waters Club, Freshwater Anglers Association, Panhandle Heritage Foundation, the South Texas Chapter of Quail Unlimited, and the Texas Watershed Management Foundation.
And the general non-profit partners that we are recommending for deletion, all of these are entities that we will continue to work with. It is just that for one reason or the other, they are not a 501(c). The Central Texas Cattlemen's Association is apparently an unincorporated association, Edwards Aquifer Authority is a governmental body, the First Texas Volunteers is really just an entity sort of within, I believe, it is the Battleship Texas Foundation. So these are actually technical deletions. We will continue to work with these groups.
In terms of closely related non-profit partners we would like to add two groups to the list. The Friends of Doctors Creek Park and Friends of Inks Lake. And there are a couple we would like to remove from the list; the Friends of the Lake Brownwood State Park and then the San Jacinto Battleground Association.
And then this is the resolution that you will be presented with tomorrow. And then this is the recommended motion that you will be presented with tomorrow. And I would be happy to answer any questions.
COMMISSIONER FALCON: Any discussion by the Commission?
COMMISSIONER FALCON: With that minor deviation, I recommend that this item be placed on the Commission meeting for tomorrow for public comment.
COMMISSIONER HOLT: Yes. Excellent job. Duggins down here. He wants to beat up on you for messing up. I am not going to let him. This committee has completed its business. We will now move on to the Conservation Committee.
(Whereupon, the meeting was concluded.)
C E R T I F I C A T E
MEETING OF: Texas Parks and Wildlife Commission
LOCATION: Fort Worth, Texas
DATE: August 26, 2009
I do hereby certify that the foregoing pages, numbers 1 through 39, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Barbara Wall before the Texas Parks and Wildlife Commission.
On the Record Reporting, Inc.
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