Commission Agenda Item No. 2
Exhibit A

COMBINATION AND SUPER COMBINATION LICENSE PACKAGES
ENDORSEMENT REVENUE ALLOCATION
PROPOSAL PREAMBLE

1. Introduction.

         The Texas Parks and Wildlife Department (the department) proposes an amendment to §53.130, concerning Super-Combination License Revenue Allocation.

         The proposed amendment would alter the title of the section and implement a new schedule for conducting the surveys used to determine stamp utilization by purchasers of super combination (hereafter, “supercombo”) license packages, and shift to use of averages to estimate utilization of each stamp.

         Under Parks and Wildlife Code, Chapter 43, no person may fish in saltwater without having purchased a saltwater fishing stamp, no person may fish in public freshwater without having purchased a freshwater fishing stamp, no person may hunt a migratory game bird without having purchased a migratory game bird stamp, no person may hunt an upland game bird without having purchased an upland game bird stamp, and no person may hunt deer, turkey, or javelina during an archery-only season without having purchased an archery stamp.

         Under Parks and Wildlife Code, §11.302, all revenue received from the sale of all types of hunting licenses, fishing licenses, and stamps must be placed in the Game, Fish, and Water Safety Account. Parks and Wildlife Code, Chapter 43, further specifies how the department deposits and spends the proceeds from the sale of each type of stamp. Under §43.405, the net receipts from the sale of saltwater fishing stamps shall be spent for coastal fisheries enforcement and management. Under §43.656, the net proceeds from the sale of the migratory game bird stamp may be used only for the management of and research concerning migratory game birds; the acquisition, lease, or development of migratory game bird habitats; contracts, donations, and grants; and only in a manner that addresses the needs of migratory birds in this state. Under §43.658, the net proceeds from the sale of the upland game bird stamp may be used only for the management of and research concerning upland game birds; the acquisition, lease, or development of upland game bird habitats; contracts, donations, and grants; and only in a manner that addresses the needs of upland game birds in this state. Under §43.805, the net receipts from freshwater fishing stamp sales may be spent only for the repair, maintenance, renovation, or replacement of freshwater fish hatcheries in this state; the purchase of game fish that are stocked into the public water of this state; or the restoration, enhancement, or management of freshwater fish habitats. The net proceeds from the archery stamp must be deposited in the Game, Fish, and Water Safety Account and may be spent for any purpose authorized for that account.  As a result, the net proceeds from the sale of each stamp, except for the archery stamp, are to be used in a way that is directly related to the type of stamp sold.

         Under Parks and Wildlife Code, Chapter 50, all combination licenses must be sold at less than the combined cost of the individual licenses, permits, or stamps included in the package, and the commission is required to allocate net revenue to individual stamp funds for the sale of stamps included in combination license packages according to a methodology that must incorporate the proportionate discounted prices of each stamp and the estimated utilization of each stamp. The super-combination license package is very popular, but because it is required by statute to be discounted, the department must allocate revenue to respective stamp accounts according to a formula.

         Under current rule, the department conducts an annual survey of stamp utilization by purchasers of the supercombo licenses, which is used to allocate supercombo revenue to individual stamp funds. Trends show that there is little variation in survey results from year to year. The proposed amendment would eliminate the annual survey requirement and replace it with a requirement for the survey to be conducted at three-year intervals. In addition, the proposed amendment would specify that the calculation would be performed using an average of the survey results from the most recent three, four or five surveys, rather than the survey results from one year only.

         Parks and Wildlife Code, Chapter 50 requires the commission to allocate net revenue to individual stamp funds for the sale of stamps included in combination license packages. The current rule addresses only supercombo licenses. The department also sells combination hunting and fishing license packages (a hunting license, a fishing license, and either the saltwater fishing stamp or the freshwater fishing stamp or both). The current rule does not address those packages because the department allocates the full cost of the respective stamp (i.e., saltwater and/or freshwater) to the respective stamp fund on a per-sale basis; however, the proposed amendment would note that allocation for the sake of clarity and compliance with statutory requirements. The proposed amendment also would retitle the section to accurately reflect the contents of the section.

2. Fiscal Note.

         Ms. Julie Horsley, Director of Planning and Analysis,, has determined that for each of the first five years that the rule as proposed is in effect, there will be fiscal implications for state government as a result of administering or enforcing the rule. Because the rule replaces the current annual survey with a survey conducted once every three years, the periodicity of fiscal implications to the agency is not annual. The current minimum cost to the department of conducting the annual survey is $13,000. Therefore, implementing a three-year survey cycle will result in a minimum cost savings of $26,000 over a three-year period.

         There will be no fiscal implications for other units of state or local government as a result of the proposed rule.

3. Public Benefit/Cost Note.

         Ms. Horsley also has determined that for each of the first five years the rule as proposed is in effect:

         (A) The public benefit anticipated as a result of enforcing or administering the rule as proposed will be the proper allocation of revenue from the sale of super-combination hunting and fishing license packages to individual stamp accounts.

         (B) There will be no adverse economic effect on small businesses, microbusinesses, or persons required to comply with the rule as proposed, as the rule affects only the department.

         (C) The department has not drafted a local employment impact statement under the Administrative Procedures Act, §2001.022, as the agency has determined that the rule as proposed will not impact local economies.

         (D) The department has determined that there will not be a taking of private real property, as defined by Government Code, Chapter 2007, as a result of the proposed rule.

         (E) The department has determined that Government Code, §2001.0225 (Regulatory Analysis of Major Environmental Rules) does not apply to the proposed rule.

4. Request for Public Comment.

         Comments on the proposed rule may be submitted to Julie Horsley, Texas Parks and Wildlife Department, 4200 Smith School Road, Austin, Texas, 78744; (512) 389-4913 (e-mail: julie.horsley@tpwd.state.tx.us).

5. Statutory Authority.

         The amendment is proposed under Parks and Wildlife Code, §50.002, which authorizes the commission to establish fees for combination licenses.

         The proposed amendment affects Parks and Wildlife Code, Chapter 50.

         §53.130. Combination and Super-Combination License Package Revenue Allocation.

                 (a) Definitions.The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

                         (1) Gross receipts — the total amount received from the sale of a combination or super-combination license package before any commission or any other collection cost is deducted.

                         (2) License — the hunting license and fishing license included in a combination or [the]super-combination license package.

                         (3) Net receipts — gross receipts less any commission and/or other collection cost.

                         (4) Original price — the price of a license or stamp if sold separately rather than as part of a package.

                         (5) Purchaser utilization — the use of a license or stamp included in the super-combination license package by the purchaser of a super-combination license package.

                         (6) Stamp — any stamp included in a combination or [the]super-combination license package.

                         (7) Super-combination license package [(package)] — those licenses and stamps listed in §53.3(7) and (8) of this title (relating to Combination Hunting and Fishing License Packages).

                         (8) Combination license package — those licenses and stamps listed in §53.3(1)-(6) of this title.

                 (b) Super-Combination License Package.

                         (1) Net receipts from the sale of a super-combination license package shall be allocated to each license and stamp in the super-combination license package by means of a relative weighting calculated by using both the original price of the licenses and stamps and purchaser utilization, which shall be based on an average of survey results from the most recent three, four or five surveys conducted[as established by annual survey].

                         (2) A survey to determine purchaser utilization shall be conducted once every three years.

                 (c ) Combination License Revenue Allocation. Fishing stamps sold as part of a combination license package are not discounted. The full value of each endorsement (100% of the original price of each stamp) sold as part of a combination license package shall be allocated to each endorsement fund.

         This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency’s authority to adopt.

         Issued in Austin, Texas, on