Fiscal Note - SB 0245 - Creates An Expedited Permit Review Process For Construction of New Air Pollution Sources
L.R. NO. 0736-01
BILL NO. SB 245
SUBJECT: Air Permit Review
#TYPE: Updated
DATE: March 6, 1997
#Updated to reflect new information
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Natural Resource
Protection Fund $0 $0 $0
Total Estimated
Net Effect on All
State Funds $0 $0 $0
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None $0 $0 $0
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
The Department of Natural Resources (DNR) assumes this proposal allows anyone
desiring an expedited review of a permit to construct an air contaminant
source to reimburse the DNR for the costs of an expedited review. The costs
would include overtime or consultant services. The DNR assumes the fees for
the expedited review would be in addition to any other fees in the statute,
including the fees in chapter 643.075 that limits the amount the department
may charge an applicant.
The DNR receives approximately 800 air construction permits applications
annually. The department assumes at least fifty percent of the applicants
would request an expedited permit review. However, DNR assumes the number of
applicants requesting an expedited review could be as high as 80 - 90
percent.
Since this legislation provides that the fees associated with the expedited
reviews are in addition to the other fees in this chapter, the DNR assumes
the $50 per hour cap established in section RSMo 643.075 does not apply. DNR
also assumes it takes an average of approximately 20 hours to review an air
construction permit application.
DNR assumes the current contract rate is $65 per hour. To expedite these
permits, the department assumes this rate could be as high as $175 per hour.
Using the $65 per hour rate as a reasonable market rate, the department
assumes department costs to expedite reviews would range between
approximately $100 per hour (assuming time and a half) and $130 per hour
(assuming double time). In the cases of expedited air construction permit
reviews, the department director would authorize overtime pay for these
activities.
Assuming 400 expedited air construction permit applications, the cost to
expedite the review would range from approximately $800,000 (400 permits x
$100 per hour x 20 hours) to $1,400,000 (400 permits x $175 per hour x 20
hours).
DNR assumes they are currently receiving $400,000 for the review of these 400
permits (400 permits x $50 per hour x 20 hours). Therefore, the differential
costs would range from approximately $400,000 ($800,000 expedited - $400,000
currently) to $1,000,000 ($1,400,0000 expedited - $400,000 currently).
#Based on information from the State of Minnesota, who passed identical
legislation in 1994, Oversight assumes the number of companies requesting an
expedited review of their permit would very small. In the first two years of
the program in Minnesota there were 21 companies who requested an expedited
review. Oversight assumes the number of companies who would request the
Missouri DNR expedite the review of their permit would range from 0 to 50
each year.
By statute DNR can charge $50 an hour for permit reviews. Oversight assumes
that for an expedited review the rate DNR could charge the company would be
time and one-half or $75 an hour. Therefore, the incremental cost of the
expedited review would be $25 and hour. Assuming a permit review takes an
average of 20 hours, the additional cost for an expedited permit review would
be $500. For 0 to 50 expedited permit reviews each year, total fees and
costs would range from $0 to $25,000.
FISCAL IMPACT - State Government FY 1998 FY 1999 FY 2000
(10 Mo.)
NATURAL RESOURCES
PROTECTION FUND
#
Income - DNR
Expedited Permit Review Reimbursements $0 $0 $0
to to to
$25,000 $25,000 $25,000
Costs - DNR
Expedited Permit Review Costs $0 $0 $0
to to to
($25,000) ($25,000) ($25,000)
Net Estimated Effect on -
NATURAL RESOURCES
PROTECTION FUND $0 $0 $0
FISCAL IMPACT - Local Government FY 1998 FY 1999 FY 2000
(10 Mo.)
$0 $0 $0
FISCAL IMPACT - Small Business
This proposal may have a fiscal impact on small businesses who seek an
expedited review of their air permits.
DESCRIPTION
This act creates an option for an "expedited review" of a permit to construct
an air contaminant source. A permit applicant may offer to reimburse the
Department of Natural Resources for costs of staff overtime or private
consultants needed to review the permit in an expedited manner.
The Department may refuse the offer or accept the offer if permit approval
priorities will not be disrupted by the expedited review.
Reimbursements shall be placed in an appropriate fund and used only to
reimburse extra costs incurred under expedited reviews. Reimbursement shall
not affect the Department's decision on the permit or what conditions are to
be included in the permit.
This legislation is not federally mandated, would not duplicate any other
program and would not require additional capital improvements or rental
space. This proposal may have an effect on Total State Revenue.
SOURCES OF INFORMATION
Department of Natural Resources
This Fiscal Note is not an official copy and should not be quoted or cited.