Texas Parks and Wildlife Commission
Finance Committee Meeting
Nov. 8, 2000
Commission Hearing RoomTexas Parks & Wildlife Department Headquarters Complex
4200 Smith School Road
Austin, TX 78744
1 BE IT REMEMBERED, that heretofore on the 8th day 7 of November, 2000, there came to be heard matters under the regulatory authority of the Parks and Wildlife 8 Commission of Texas, in the Commission Hearing Room of the Texas Parks and Wildlife Headquarters Complex, 9 Austin, Texas, beginning at 10:00 a.m., to wit: 10 APPEARANCES: 11 THE PARKS AND WILDLIFE COMMISSION: 12 FINANCE COMMITTEE: CHAIR: Dick Heath, (Absent) 13 Lee M. Bass Carol E. Dinkins 14 Nolan Ryan, (Absent) Ernest Angelo, Jr. 15 John Avila, Jr., (Absent) Alvin L. Henry 16 Katharine Armstrong Idsal Mark E. Watson, Jr., (Absent) 17 18 THE TEXAS PARKS AND WILDLIFE COMMISSION: Andrew H. Sansom, Executive Director, and other 19 personnel of the Parks and Wildlife Department 20 21 22 23 24 25 ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 2 1 FINANCE COMMITTEE 2 VICE-CHAIR DINKINS: With that, we will 3 move to the Finance Committee, and the vice-chair of 4 that committee is Commissioner Angelo, and he's going 5 to chair it for us this morning. 6 COMMISSIONER ANGELO: Thank you, Madam 7 Chairman. 8 In the absence of Commissioner Heath, we 9 first ask the committee to -- the commission to 10 approve the committee minutes from the previous 11 meeting. 12 COMMISSIONER HENRY: Moved. 13 VICE-CHAIR DINKINS: I'll second. 14 COMMISSIONER ANGELO: All in favor say 15 aye. 16 (Motion carries unanimously.) 17 COMMISSIONER ANGELO: We have the -- 18 the minutes have been approved. 19 AGENDA ITEM NO. 1: BRIEFING-CHAIRMAN'S CHARGES. 20 COMMISSIONER ANGELO: Mr. Sansom. 21 MR. SANSOM: A few comments, members, on 22 the charges as they relate to the finance committee. 23 The first is that we have signed a 24 contract with MCI to convert our license point-of-sale 25 system, and the system design is under way and on ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 3 1 schedule. 2 Our license deputy advisory committee, 3 which is the committee which represents the retailers 4 who sell licenses throughout the state, met Monday and 5 looked over the system and we received their input. 6 Jayna Burgdorf will report on, both, the 7 status of the project and the results of that 8 stakeholders meeting today. 9 The other thing that I would really like 10 to call your attention to and point out is that our Big 11 Time Texas Hunts program continues to be tremendously 12 successful. We've now received 82,147 applications, 13 and the revenues are up over $800,000 in that program. 14 So that's a very, very exciting development. And that 15 concludes my report. 16 ITEM NO. 2: BRIEFING-FINANCIAL REVIEW UPDATE. 17 COMMISSIONER ANGELO: All right. Then 18 we'll move onto Item Number 2, which is the financial 19 review update. 20 And Suzy Whittenton. 21 MS. WHITTENTON: Thank you, Mr. Chairman 22 and commissioners. 23 The finance presentation today will 24 focus mostly on current revenue information, and then 25 I'll touch briefly on some operating budget information ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 4 1 and give you a quick update on the appropriations 2 request process. 3 We'll just go ahead and start out with a 4 little bit of bad news. State park fees are down for 5 the period September and October by approximately 27 6 percent, which is $1.2 million, when you compare it to 7 the same period of time last year. 8 In talking to the park managers, a lot 9 of them think it's weather related. You know, our 10 analysis is kind of inconclusive on it at this time. 11 We were down 15 percent in September and then went down 12 further in October. So, you know, September was hot 13 and dry; October was very, very wet. We did look into 14 park cancellations. The rate wasn't any higher this 15 year than last year, but we did have fewer day visits, 16 and some of the overnight stays were cut short. 17 So we'll continue to look at park 18 revenue further and monitor it closely. Even though 19 the revenue is down, it's still early in the fiscal 20 year for park revenue, and the original estimate was 23 21 million, and that was calculated before we knew how 22 good the fiscal year 2000 numbers were going to be. So 23 even though it sounds bad that our revenue is down, 24 we're not concerned about it, as far as budget status 25 goes, at this point because even with it being down, ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 5 1 we're still projecting $23.6 and we only budgeted 23. 2 So we're not looking for any kind of a revenue 3 adjustment at this time, but we will continue to 4 monitor it and hope that the trend doesn't continue 5 there. 6 Moving onto Account 9 where we deposit 7 our boat registrations and titling fees and also all 8 our license fees, both registrations are also down for 9 this period, but, again, September and October are not 10 months where we normally expect much activity in boat 11 registrations. We had a low year in fiscal year 2000, 12 probably due to the drought, and, hopefully, by this 13 spring, we'll see these numbers going back up. 14 Now for some good news. License sales 15 overall are up $1.9 million, or about 5 percent. This 16 means that compared to the same two-month period last 17 year, we've collected $1.9 million more. 18 Super Combo sales are a big factor in 19 the high revenue, with an 18-percent increase over last 20 year. We'll be looking at Super Combo statistics in a 21 little bit more detail later in the presentation. 22 Combo sales are down, as we expected, 23 and overall combination license sales are up six 24 percent. 25 In looking at hunting license sales, ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 6 1 resident hunting licenses are up almost 5 percent, but 2 nonresident sales are down 3.6, with an overall decline 3 in hunting sales of 1 percent. Of course, this is 4 partly due to people moving to the Super Combo, 5 probably. 6 Fishing license sales are down 10 7 percent across the board at this time. This also is 8 probably due somewhat to a shift in the type of 9 licenses people are buying, because the Super Combos 10 are going up. We're not sure at this time. We do know 11 that there were some weather issues, probably, have 12 impacted fishing licenses so far. 13 It's worth noting that the saltwater 14 stamp sales are down 10 percent, but the revenue is up 15 28 percent due to the fee increase that we enacted. 16 In the Texas Outdoor Connection sales, 17 which is sales from the point-of-sale system, they show 18 that we've collected about 60 percent of the original 19 estimate. The current projections indicate that we 20 very well may have more revenue than projected, but 21 we're not ready to recommend any kind of an adjustment 22 at this time. 23 Okay. I mentioned that we'd be looking 24 at Super Combo in more detail. Here is a slide that 25 will slow the last five years, how much sales have ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 7 1 increased. 2 The communications division has done a 3 lot of marketing on this license type, and you can see 4 the results of that. Each year the sales have 5 increased significantly. They've -- We've mailed out 6 the Hook and Bullet newsletter to 266,000 Super Combo 7 holders and reminded them all to renew. We also mailed 8 personal letters to the Combo holders and encouraged 9 them to upgrade to the Super Combo. 10 You can see that as of -- in the 11 current fiscal year, as of the end of October, we 12 already had sold more than we sold all of last fiscal 13 year. 14 COMMISSIONER ANGELO: Suzy, why don't we 15 comment on the follow up -- I mean, the number of 16 people that buy those licenses that subsequently buy 17 them again. 18 MS. WHITTENTON: Right. When you look 19 at the renewal rates, we've had 72 percent -- Let me 20 go onto this side -- 72 percent of the Super Combo 21 holders, the people who bought them last year bought 22 again this year. So that's a very high renewal rate, 23 and that's slightly higher than the renewal rate that 24 we had the year before. 25 Also, the response of the mailing to ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 8 1 Combo holders resulted in a conversion rate, from the 2 Combo to the Super Combo, of 28 percent for the Combo 3 license holders that had one stamp, and 13 percent for 4 those with no stamps. 5 This slide shows the point in time, if 6 you compare last year's as of October 31st, and this 7 year at October 31st, and you can see an 18-percent 8 increase. So it looks very favorable. 9 Also, on the Big Time Texas Hunts, which 10 Andy mentioned, this is another thing that the 11 communications division has marketed. Personal letters 12 were sent, with a flyer and a postage paid return 13 envelope, was mailed out in August, and then, in 14 October, reminder letters were mailed out to those who 15 hadn't renewed -- or who hadn't responded yet. 16 This slide shows that as of the end of 17 October, we had sold 74,000, and, as Andy mentioned, as 18 of yesterday, we had sold 82,000 applications or 19 entries, which is a 15-percent increase over fiscal 20 year 2000's numbers. We'll be accepting entries that 21 were postmarked as of the deadline, which was November 22 the 4th. We'll be accepting those through the end of 23 the weak that have a postmark of November the 4th. So 24 we're pretty sure -- we feel pretty confident that 25 we'll exceed our goal, which was 84,000 entries. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 9 1 This slide just shows the distribution 2 of the type of drawings purchased, with the majority in 3 the Grand Slam and the Whitetail Bonanza, but we're 4 also selling quite a few in the Exotic Safari and the 5 Big Time Bird Hunts. 6 In the operating budget, we're in the 7 process now of closing out the last fiscal year's 8 books, and at this time, it appears that we'll lapse 9 approximately $4 million in regular operating budget, 10 which is about 2 1/2 percent of the original budget. 11 This doesn't include federal funds or fringe benefits 12 and stamp funds, but each division is charged with 13 monitoring their own budget, and they're not allowed to 14 go over in their budgets, and so getting within 2 1/2, 15 we feel like, is really pretty good. Four million 16 sounds like a high number, but it's pretty close. And 17 what that is, is that's appropriation authority mostly, 18 and, in most cases, the cash will transfer forward, and 19 we just lost the authority to spend that in that fiscal 20 year. So we're really working to try to keep that -- 21 keep from lapsing much. 22 COMMISSIONER ANGELO: How does that 23 number compare to the previous years? 24 MS. WHITTENTON: I'm not -- 25 COMMISSIONER ANGELO: In percentage -- ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 10 1 MS. WHITTENTON: I'm not sure -- 2 COMMISSIONER ANGELO: In percent. 3 MS. WHITTENTON: It's probably quite a 4 bit lower than usual. I don't remember. I know that, 5 you know, when the -- we hear about our lapses in 6 appropriations committees, they're usually giving us 7 the big numbers that include fringe benefits, federal 8 funds, stamp funds, things like that, that I'm not 9 including here. This is just regular operating 10 budget. So I know we've made a concerted effort to not 11 lapse this time. So I'll check into that and get back 12 to you on that. 13 Also, in the fiscal year -- the current 14 fiscal year 2001, we've still got 92 percent remaining 15 so early in the year. This was as of the end of 16 September. That's not real meaningful; it just looks 17 like we're about on track. 18 And then real quickly I wanted to update 19 you on the legislative appropriations process and 20 remind you that what we had done was we had submitted 21 our request, which was limited to the level -- base 22 level funding. We also asked for some exceptions to 23 that. We asked to get additional funding for 24 operations and maintenance of -- which includes eight 25 million per year in scheduled facility repairs to ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 11 1 maintain the statewide infrastructure. And we also 2 asked for additional five million per year for -- to 3 establish or restore services in existing parks. That 4 includes 81 1/2 employees, 9 of which are for the 5 regional park interpretive program. 6 We also asked for authority to spend two 7 million per year of the money that we're getting from 8 the stamp -- the saltwater stamp increase for the 9 commercial buyback and license buyback. That's not new 10 money. The two million is not new money; just 11 authority to spend. The other 13 million we're asking 12 for is actually new money. 13 At our last meeting, we had just -- we 14 had just submitted the request, and since that time, we 15 had our first budget hearing on September the 5th with 16 the legislative budget board and the governor's 17 office. We feel like the hearing went very well. And 18 since that time, the staff from the oversight agencies 19 have been asking a lot of questions; they're doing 20 their analysis, putting together their 21 recommendations. We've been told that those 22 recommendations will be out in December, and then the 23 session will start January the 9th, and we'll expect 24 our budget hearings over at the Capitol to begin 25 shortly thereafter. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 12 1 COMMISSIONER ANGELO: Let me ask you a 2 question. 3 MS. WHITTENTON: Sure. 4 COMMISSIONER ANGELO: During the earlier 5 hearings, the meetings with Sunset Commission, there 6 were some specific areas that were questioned in the 7 budget, specific line items. Did any of these come up 8 during your initial budget hearings? Was there any 9 tracking there? 10 MS. WHITTENTON: No, not really. We 11 didn't see much of the same kind of questions, no. Our 12 first budget hearing was mostly an opportunity for us 13 to lay out what we were asking for, and they asked some 14 questions about specific programs. And since that 15 time, they've been asking a lot of questions about the 16 specific line items in the request. You know, how we 17 came up with numbers and how they compare to what we're 18 doing currently and that sort of thing. 19 COMMISSIONER ANGELO: Any other 20 questions? 21 Thank you, Suzy. 22 MS. WHITTENTON: Thank you. 23 AGENDA ITEM NO. 3: ACTION-ARTWORK. 24 COMMISSIONER ANGELO: Item Number 3 on 25 our agenda is an action item regarding the artwork. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 13 1 MS. STILES: My name is Frances Stiles, 2 and I'm with the administrative resources division and 3 here with Mr. Bubba Wood to introduce the agenda item 4 for artwork approval. 5 Under the terms of the contract with 6 Collectors Covey for the artwork, design, and marketing 7 of the departmental prints program, the commission 8 approves artwork each year for the Waterfowl, Nongame, 9 Turkey, and Saltwater prints. 10 The artwork for these stamps is combined 11 into a collector's version consisting of eight stamps 12 and is offered by Parks and Wildlife. 13 Additionally, Collectors Covey offers 14 the print reproductions through their established 15 marketing network, and TPWD receives a portion of the 16 sale from each print. This year we have four prints, 17 four artwork. 18 The artwork for the Waterfowl stamp 19 features a Snow goose and Blue goose, by John Dearman. 20 The Nongame stamp features the Long 21 Billed Curlew, by Thomas Quinn. 22 The Turkey stamp features the Rio Grande 23 Turkey, by Herb Booth. 24 And the Saltwater stamp features the 25 Redfish, by Diane Rome. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 14 1 The artwork for these stamps is being 2 displayed on these easels, as you see, and Mr. Wood is 3 here to answer any questions that you might have about 4 the artwork. 5 COMMISSIONER ANGELO: Mr. Wood, do you 6 have any comments you'd like to make? 7 MR. WOOD: Yeah, but not about the 8 artwork. I could comment on how late we were up last 9 night. 10 COMMISSIONER ANGELO: You wouldn't be by 11 yourself. 12 Does anyone have any questions? 13 They look like some great prints. 14 MR. WOOD: Thanks. You know, I guess, 15 I -- given one, once a year, a chance to editorialize 16 about our duck stamp program, Frances and I were just 17 looking at the numbers. We have paid the department, 18 over the last 20 years, in excess of $6 million in 19 stamp sales, from the sale of the prints. Not 20 department sales in stamps, but our sale of stamps and 21 prints has amounted to more than $6 million for the 22 Parks and Wildlife Department, which -- 23 COMMISSIONER ANGELO: Pretty nice deal. 24 MR. WOOD: Yeah, it is. It's a good deal 25 for us, too. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 15 1 COMMISSIONER ANGELO: Well, I think 2 everybody appreciates it. Got a lot of followers. 3 Are there any other comments or 4 questions? 5 CHAIRMAN BASS: Do you see any 6 correlation of interest in the stamps and the print 7 collection to no longer having the requirement for the 8 traditional stamp on the license? 9 MR. WOOD: Oh, yeah, it -- I can't 10 remember the -- we, in fact, I think, even talked 11 about this two or three years ago when that first 12 happened. Maybe the second year, because the first 13 year we knew it was going to hurt. We didn't know 14 what -- but the sales were off about 25 percent that 15 first year, and then they really have leveled out. 16 And, you know, there is a natural attrition to this 17 program. You know, when you get -- someone might want 18 21, but all of a sudden, 22 of them is just "I give. 19 You can print them longer and more of them than I can 20 buy." And so you're going to have some attrition every 21 year. I mean, every program I've ever heard of has 22 attrition. But, frankly, it wasn't as bad as I thought 23 it would be, you know? 24 COMMISSIONER ANGELO: Last year we 25 talked a little about the promotion of the sale of the ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 16 1 prints through the magazines. 2 MR. WOOD: Right, and Andy gave us an 3 ad, and I can't tell you that it -- you know, you just 4 can't say -- it certainly didn't hurt, for sure. And 5 it -- most of the people that are collecting them now 6 are people who continue to collect matching numbered 7 sets of the whole print, you know, of the whole 8 series. They've got Number 330 of the duck stamp, and 9 it's just amazing how many people, almost as soon as 10 they get this year, will call up and start to want to 11 place their order for the second one, but it's very 12 difficult to generate "Hey, this is our 22nd print. 13 Would you like to have one?" 14 "Well, you know, if I had wanted one, 15 I'd have bought, you know, sometime in the last 21 16 years," you know? 17 COMMISSIONER ANGELO: I've got a full 18 set of the waterfowl ones myself. 19 MR. WOOD: God bless you. 20 COMMISSIONER ANGELO: You don't have any 21 plans to come tomorrow and make another presentation at 22 the regular meeting. 23 COMMISSIONER ANGELO: That being the 24 case, this consent agenda, and if we could have motion 25 to that effect. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 17 1 COMMISSIONER HENRY: Motion. 2 VICE-CHAIR DINKINS: Second. 3 (Motion carries unanimously.) 4 COMMISSIONER ANGELO: Very good. The 5 motion is passed. 6 And, Mr. Wood, thank you again. 7 MR. WOOD: Thank you-all. 8 COMMISSIONER ANGELO: Ms. Stiles, thank 9 you. 10 MR. WOOD: We really appreciate you. I'm 11 very impressed with this many people being here this 12 early after last night. 13 COMMISSIONER ANGELO: It wasn't easy. 14 MR. WOOD: Yeah, I can imagine. It was 15 even tougher to get up at 4:00 and drive from Dallas. 16 COMMISSIONER ANGELO: I can guarantee 17 you that's right. 18 CHAIRMAN BASS: We appreciate all you're 19 doing. 20 MR. WOOD: Thank you. 21 AGENDA ITEM NO. 4: BRIEFING-POINT-OF-SALE UPDATE. 22 COMMISSIONER ANGELO: And now we'll hear 23 a presentation from Jayna Burgdorf. 24 Jayna? 25 MS. BURGDORF: Hi. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 18 1 COMMISSIONER ANGELO: How are you this 2 morning? 3 MS. BURGDORF: Good. 4 This is the license sales system 5 transition briefing. And, actually, I'll point out 6 that I'm no longer calling it the Texas Outdoor 7 Connection. That doesn't mean we've made a decision 8 yet, but y'all could consider weighing in possible 9 names for continuation of that name. 10 Our contract with Transactive does 11 expire on August 31, 2001. In the past two months, 12 we've had some recent developments. We signed a 13 contract with WorldCom. And I'd also like to introduce 14 Bob Parker, who is our program manager with WorldCom, 15 and he is located here in Austin. 16 Bob, if you'd -- 17 He's been a great resource. 18 We completed the basic design sessions. 19 We're in the process of finalizing all our user 20 requirements. And, as Andy mentioned, we did hold our 21 second license deputy advisory committee meeting on 22 Monday, and that went really very well. When I say 23 "second," we had this committee back in 1994, but 24 we've reconstituted it, in light of the fact that we 25 are moving to a new automated system. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 19 1 I'm sorry. Every time I make a 2 presentation and I'm pregnant, I have trouble 3 breathing, so I have to apologize. 4 COMMISSIONER ANGELO: We're having that 5 problem today, too. 6 MS. BURGDORF: There are some customer 7 benefits with this new system. We expect that we will 8 reduce the wait time, and there's a number of reasons 9 for this. 10 With the new system, what you will be 11 able to do is not only use your driver's license in 12 order to not key entry everything: The name, the 13 address, but you will also be able to use bar codes 14 from last year's license, and that would be, both, a 15 customer identification and also your driver's license 16 number that would be on the new license. 17 We will have updates from DPS and the 18 National Change of Address file, which are -- in other 19 words, what that does is if you change your address 20 because you go get a new license or because you go to 21 the post office and you move, then those updates will 22 come to our database, and so when you come in -- let's 23 say you moved in the past year, and you want to buy 24 your fishing license again. Your new address will come 25 up. And that will save on a lot of key entry, which is ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 20 1 time, and it will also increase the accuracy. 2 Additionally, WorldCom will receive only 3 half the transaction fee for off-line sales, and that 4 should be an incentive to them to keep the system on 5 line and up and running, and that's where, again, you 6 have more accuracy and reduced time in line. 7 We are going to have a hunter education 8 number on the license, which is something that a lot of 9 people have wanted. As more people are required to 10 have this hunter education number, and as they -- it's 11 been a long time, perhaps, since they've been through 12 the program; they've lost their cards, and it's a 13 hassle for them, and they forget to get their cards, 14 and so by automatically printing it on the license, 15 that complies with the law. And so they won't 16 necessarily have to have their card when it prints out 17 on the license. 18 We will offer the same kind of 19 authorization number and license fulfillment through a 20 call center service. We'll also offer it through the 21 Internet. We may be passing on the mail fulfilment 22 cost, which we don't do right now. 23 And this is kind of the more interesting 24 part of the presentation: We hope to have what we 25 think is a more user-friendly license, which is tags ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 21 1 around the body of the license. And I have two formats 2 I'd like to pass out. 3 One is a 12-tag format, which is how 4 many tags we have now. The other is a 14-tag format. 5 And please look at the front and back. And I will also 6 pass around, just for reference, the -- this is the 7 pre-automated license, and oftentimes you hear 8 people -- people get sentimental about this system at 9 all; they get sentimental about the old license and how 10 it looked and how the tags didn't come off if you took 11 one out of the middle. 12 I also have a sample of the license 13 stock, which is similar to the same -- to the stock 14 that we're going to use right now -- or that we use 15 right now, which is Valeron. And you will notice the 16 bar codes on those licenses. Those all fold up -- and 17 I've got a demonstration there of how they fold up -- 18 into a credit card size. So they should be fairly easy 19 to carry in someone's wallet. 20 If you purchase a fishing license under 21 one of these two formats, there would probably be 22 verbiage that would say, you know, "Call Operation Game 23 Thief if you notice a violation" or "Consider 24 purchasing Texas Parks and Wildlife Magazine," or 25 perhaps some coupon opportunities that we might work ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 22 1 out with a vendor. But it would also have instructions 2 that you could tear off those tags' faces. 3 What we're trying to do with these two 4 formats is preserve the body of the license in the 5 middle with creases, and then the tags around it with 6 perfs. So if we were to perforate the whole thing, 7 there is some concern -- which was actually voiced by 8 the license deputy advisory committee as well -- that 9 people would accidentally tear their license in the 10 middle, and we don't want that to happen. So whatever 11 comments y'all have on that. 12 The concern about going with the 12-tag 13 format, even though that's all we have right now, is 14 that what that does is, for the next five years, it 15 somewhat boxes you into staying with 12 tags. Now, I'm 16 sure that -- there's a price for everything, and I'm 17 sure WorldCom would tell us "Well, if you'd like to add 18 another tag, we can redo this license, and it will 19 be," this amount of money and this much time. But we 20 probably need to consider both of those factors as we 21 go forward. 22 CHAIRMAN BASS: Jayna, what would be an 23 incremental cost up front if we were to go to the 24 14-tag option? 25 MS. BURGDORF: I don't think there is an ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 23 1 additional cost. 2 CHAIRMAN BASS: So it gives each 3 regulatory options with no cost that otherwise might 4 have a physical impact? 5 MS. BURGDORF: Right. Right. 6 CHAIRMAN BASS: Sounds like an easy 7 choice to make. 8 MS. BURGDORF: The only issue is it's a 9 little bit bigger, of course, so -- but if that isn't 10 an issue for everybody -- the license deputies 11 didn't -- you know, I think there was a small 12 preference towards the smaller license, but they 13 clearly understood the downsides of boxing ourselves 14 into that kind of a corner. 15 COMMISSIONER ANGELO: The two extra tags 16 would have what on them? 17 MS. BURGDORF: Well, for -- 18 CHAIRMAN BASS: Advertising. 19 MS. BURGDORF: Yeah. The sample just 20 shows an operation gamefee, I think, and a -- 21 COMMISSIONER ANGELO: That would be one 22 possibility for what -- 23 MS. BURGDORF: Right. 24 COMMISSIONER ANGELO: -- To put on it? 25 MS. BURGDORF: Right. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 24 1 COMMISSIONER ANGELO: Something that 2 would make it clearer than it was on another tag. 3 MS. BURGDORF: Exactly. Exactly. 4 COMMISSIONER IDSAL: Could we advertise 5 on the blanks? 6 MS. BURGDORF: Yes. There's -- I don't 7 believe there's anything prohibiting us from doing 8 that. 9 CHAIRMAN BASS: Make it a discount 10 coupon on Winchester shotgun shells or something. 11 MS. BURGDORF: And that's one -- been 12 one of the suggestions tossed around, to do something 13 similar to that. 14 COMMISSIONER ANGELO: I guess, by going 15 to 14, we might be signaling that we're getting further 16 away from no tags; is that right? 17 I didn't really mean -- I didn't really 18 mean to bring up another subject. 19 CHAIRMAN BASS: Since there was public 20 resistance to no tags -- 21 COMMISSIONER ANGELO: Yeah, I noticed 22 that. 23 MS. BURGDORF: Yeah. 24 CHAIRMAN BASS: Thanks for everything. 25 COMMISSIONER ANGELO: Sore subject. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 25 1 MS. BURGDORF: There are additional 2 benefits for the license deputies from this system as 3 well. We believe we have a committed vendor with 4 significant resources. MCI -- or WorldCom, actually, 5 is their official new name -- has five states under 6 contract for hunting and fishing license systems, and 7 we think that's significant from the standpoint that 8 they're clearly slowing a commitment to this type of 9 business. They have a whole government services 10 division; they have a large staff and a lot of 11 financial resources. 12 The new terminal, and I -- actually, we 13 had one down here at another meeting, and I can bring 14 it down again, but it has a larger touch screen that a 15 clerk can use to enter the license, and we believe that 16 that will reduce errors, and it will also save the 17 merchants on training time. 18 And the printer will now know 19 automatically where the top of the license is, and they 20 won't have to spend their time adjusting to make those 21 licenses line up, which is what they do right now. And 22 for those -- for our retailers, time is money. 23 There are some policy changes that are 24 going to be affecting them, and we went over this with 25 them at the meeting on Monday, and they all seem to ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 26 1 understand that we are grandfathering all current 2 license deputies, which means if you are -- if you can 3 sell right now, you will sell in the new system if you 4 choose to. 5 We are requiring a performance guarantee 6 of $250 to $500 dollars depending on your equipment 7 setup, and that is not something we've had in this 8 current system. Previously, we had the requirement for 9 a bond, which none of the license deputies liked 10 because they had to pay for the bond, and not only was 11 it money out of pocket, but it was a bit of a hassle, 12 too, especially for your smaller ones. They had work, 13 whether it was with their insurance agent or their 14 bank. 15 We are planning for those license 16 deputies that sell under 100 transactions per year -- 17 and you'll be interested to know we're talking about 18 over 700 of our license deputies have a very small 19 transaction rate per year -- we are planning to 20 provide them with a printer, the same printer that a 21 regular merchant would get, and attach that to their 22 own PC. And, really, what that does there is it allows 23 them to print out the hard copy of the license, but 24 it -- they don't have the same waiting in line issues 25 that some of our other deputies do, and they don't need ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 27 1 that same connection speed. A lot of the ones that 2 we're talking about are ranches where they have 3 customers coming in either from in-state or 4 out-of-state, and so those people need that paper 5 Valeron license so they can have those tags, but they 6 don't -- they're not usually standing in line and 7 having an issue there. 8 Right now, we have somewhat of a 9 situation with the large stores that will let them get 10 however many terminals from Transactive that they want, 11 and, of course, at times, Transactive has claimed that 12 they've run out of terminals. What we are doing this 13 time is a maximum of six terminals provided by Parks 14 and Wildlife, at no charge, and, of course, that would 15 be at your very high volume locations. But some 16 stores, just for their convenience and the convenience 17 of their customers, like to have a terminal at every 18 lane, and they understand now that that will change 19 under this new system. 20 CHAIRMAN BASS: So, under that, it would 21 be a maximum of six per Wal-Mart outlet or six -- 22 MS. BURGDORF: Right. 23 CHAIRMAN BASS: -- As opposed to six per 24 Wal-Mart? 25 MS. BURGDORF: Right. Yeah. No. No. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 28 1 Although, it was interesting that we had a large 2 representation from Wal-Mart at the meeting on Monday, 3 and they were telling me that, in some states, there is 4 a maximum number of terminals, and they have to wait 5 when they open a new store for someone else to go out 6 of business or to decide not to be -- not to sell 7 licenses for them to get a terminal for their Wal-Mart 8 store, which is kind of amazing. 9 CHAIRMAN BASS: We don't want to do 10 that. 11 MS. BURGDORF: Yeah, we're not doing 12 that. 13 Future license deputies. We will have 14 an application process, and that would include things 15 like a credit check, where is your business located? 16 In other words, is there a current license deputy right 17 across the street from you? What are your expected 18 sales? What we found with other states is that our 19 ratio of license deputies to license sales is really 20 out of line. We have a disproportionate number of 21 license deputies comparatively, even when you look at 22 our large volume of sales. 23 We will require that they pay the 24 performance guarantee -- by the way, which is 25 refundable -- and we will require that they pay a ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 29 1 monthly lease fee for equipment. 2 COMMISSIONER ANGELO: Jayna, what kind 3 of response from the providers do you get -- from 4 the -- 5 MS. BURGDORF: It was -- 6 COMMISSIONER ANGELO: -- deputies? 7 MS. BURGDORF: From the deputies? We 8 brought this up at our, kind of, first again new 9 meeting of this fiscal year, in July. We brought that 10 up and didn't get a lot of backlash, and, of course, we 11 have lots of information on what other states do. You 12 have Ohio that charges -- I think it's 416 per year, 13 nonrefundable deposit. 14 So when you look at some of those, how 15 other states do it, in comparison to what we're 16 proposing, we're pretty much right in the middle. 17 We're very reasonable. Louisiana, for example, on the 18 low side, is 150 per year -- or 150, period, 19 refundable deposit. That's it. 20 So I think when they saw in it context, 21 they understood. I think they understood that the 22 state does have an interest in protecting its funds 23 that are outstanding. What we did after that meeting 24 is we sent out minutes of that meeting to all license 25 deputies, whether they at -- you know, whether they're ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 30 1 on the committee or not, and -- wondering if we would 2 hear some response or some backlash for this proposal, 3 and we really did not have -- maybe one or two 4 deputies called and said they didn't like that idea, 5 and that was it. 6 At Monday's meeting, again, very little 7 response, very little concern. There was one comment 8 about "Well, is it really going to be per equipment 9 setup, or could it just be overall?" There's also -- 10 what we have planned to do is ask them if they need 11 financial -- well, not -- I shouldn't say financial 12 assistance, but if they need some kind of effort on our 13 behalf to stagger, through a payment process, their 14 performance guarantee; they're willing to do that. 15 We are also going to have some benefits 16 aside from what we're pointing out with just the 17 customers and the license deputies. We'll have more 18 accurate customer information for surveys and marketing 19 purposes. We'll have a straightforward transition from 20 one license year to the next. Right now, when we -- 21 when we download for the new year, it's a lengthy 22 programming process, and, in addition, we have to call 23 up -- Transactive, I guess I should say, has to call 24 every license deputy and set aside an hour or two to 25 get the new information into the system. Most of this ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 31 1 will happen from an administrative screen going forward 2 with MCI, so there won't be that process. 3 Again, we'll have this performance 4 guarantee to ensure the collection of our funds and the 5 maintenance of equipment, and we will have the ability 6 to manage the cost of our contract, which brings me to 7 my next slide. 8 We are looking at a slightly higher cost 9 on this contract than we have with Transactive right 10 now. And I guess, to me, I'm hoping that falls into 11 the "you get what you pay for" category. I'm hoping 12 we're getting a more reliable system. But we're 13 looking at 3.6 million. Fiscal -- This past fiscal 14 year, we paid 3.3 million to Transactive. We also 15 broke our costs into different categories. Instead of 16 just a transaction fee, it's now a transaction fee, 17 equipment lease costs, mail fulfilment costs, some of 18 which will be passed onto the customer. 19 And our next steps, continue with system 20 design and development. We did have a call center 21 study that recommended that, along with looking at 22 external parties to run our call center, that we also 23 examine our internal park reservation system as an 24 option. We do plan to issue requests for offers for 25 the call center and Internet in the December to ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 32 1 February time frame. We will have our next license 2 deputy advisory committee meeting in January, our pilot 3 February and March, and statewide rollout April through 4 June. 5 And I'd be happy to answer any 6 questions. 7 COMMISSIONER ANGELO: Are there any 8 questions? I don't believe so. 9 CHAIRMAN BASS: Not now. I think, 10 Jayne, if you'll be available when we do the 11 regulations items. 12 MS. BURGDORF: Okay. Sure. 13 CHAIRMAN BASS: I think there might be 14 some discussion there from a new vendor and what name 15 may not be feasible under the technology. Some 16 questions might arise at that time. 17 MS. BURGDORF: Okay. No problem. 18 COMMISSIONER ANGELO: Thank you. 19 Do you have a question? 20 MR. SANSOM: No, sir, I have a comment 21 that goes under the category of other business. We 22 have no problem. 23 COMMISSIONER ANGELO: Okay. Thank you. 24 AGENDA ITEM NO. 5: OTHER BUSINESS. 25 COMMISSIONER ANGELO: And under other ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 33 1 business, what do we have? 2 MR. SANSOM: I would like to inform the 3 committee of several audits under way in the department 4 at the present time. 5 The state auditor is finishing up an 6 audit of the commercial fishing industry in Texas. The 7 principal objective is the cost which Oyster Moon and 8 other commercial fishers pay for their practice. That 9 study is principally of the industry, and it will be 10 due out, in draft, sometime next week. 11 The state auditor has also begun an 12 audit of the Chief Financial Officer's area, the 13 principal objective of which is to examine our revenue 14 estimating and financial processes to identify, if 15 possible, any non-value added services and potential 16 cost savings. 17 There's a routine federal compliance 18 audit under way. The state auditor routinely audits 19 state agencies, not only Parks and Wildlife, but 20 Department of Human Services and others which receive 21 substantial amounts of federal funds. The purpose of 22 this audit is to make sure that we're in compliance 23 with the federal rules and regulations. 24 Those two audits should be complete and 25 available for you by January. ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 34 1 Finally, we're coming to the end of an 2 audit which is being completed by the controller's 3 office on our sales tax collections. The department, 4 because we sell goods in state parks -- we have a 5 relationship with a contractor on a catalog, we have 6 the Park and Wildlife Press, which is our book sales 7 operations. We do collect sales taxes, and it looks 8 like we owe about $35,000 or so in state sales taxes, 9 and that's been a tremendous amount of work by 10 DennisO'Neil, our internal auditor, to bring that 11 number into a manageable figure. 12 So those -- I just wanted to make sure 13 that you-all were aware that those studies are under 14 way. 15 At the present time, I have no 16 particular issues or concerns on behalf of the auditors 17 to report to you, but I'm sure you'll be speaking to 18 them. 19 COMMISSIONER ANGELO: Any questions or 20 comments? 21 If not, Mr. Chairman, I think that 22 concludes the meeting of the finance committee. We 23 stand adjourned. 24 CHAIRMAN BASS: Thank you. 25 Why don't we maybe take a 5-minute break ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 35 1 and let everyone get on their feet a little bit because 2 we're all dragging a little bit now. I think that 3 might be in all of our communal best interests. 4 (Break taken.) 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 36 1 THE STATE OF TEXAS ) COUNTY OF BEXAR ) 2 3 I, STACI D. SLAYDEN, a Certified Court 4 Reporter in and for the State of Texas, do hereby 5 certify that the above and foregoing pages constitute a 6 full, true, and correct transcript of the minutes of 7 the Texas Parks and Wildlife Commission on November 8, 8 2000, in the Commission hearing room of the Texas Parks 9 and Wildlife Headquarters Complex, Austin, Travis 10 County, Texas. I FURTHER CERTIFY that a stenographic 11 record was made by me at the time of the public meeting 12 and said stenographic notes were thereafter reduced to 13 computerized transcription under my supervision and 14 control. WITNESS MY HAND this ____ day of 15 ________________________, 2001. 16 17 ________________________________ 18 STACI D. SLAYDEN, Texas CSR 7290 19 Expiration Date: 12/2001 20 7800 IH-10 West, Suite 100 21 San Antonio, Texas 78230 22 (210) 377-3017 23 24 25 ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016 . 37 1 2 _______________________________________ DICK W. HEATH, CHAIRMAN 3 4 _______________________________________ CAROL E. DINKINS 5 6 _______________________________________ LEE M. BASS 7 8 _______________________________________ NOLAN RYAN 9 10 _______________________________________ ERNEST ANGELO, JR. 11 12 _______________________________________ JOHN AVILA, JR. 13 14 _______________________________________ ALVIN L. HENRY 15 16 _______________________________________ KATHARINE ARMSTRONG IDSAL 17 18 _______________________________________ MARK E. WATSON, JR. 19 20 21 22 23 24 25 ESQUIRE DEPOSITION SERVICES 7800 IH-10 WEST, SUITE 100, SAN ANTONIO, TX 78230 (210)377-3027 (800)969-3027 FAX (210)344-6016