Texas Parks and Wildlife Commission
Finance Committee Meeting
Nov. 7, 2001
Commission Hearing RoomTexas Parks & Wildlife Department Headquarters Complex
4200 Smith School Road
Austin, TX 78744
1
7 BE IT REMEMBERED that heretofore on the
8 7TH day of NOVEMBER 2001, there came on to be
9 heard matters under the regulatory authority of
10 the Parks and Wildlife Commission of Texas, in
11 the commission hearing room of the Texas Parks and
12 Wildlife Headquarters complex, Austin, Travis
13 County, Texas, beginning at 11:58 a.m., to wit:
14
15
16
APPEARANCES:
17 THE PARKS AND WILDLIFE COMMISSION:
FINANCE COMMITTEE:
18 Chair: Ernest Angelo, Jr., Midland, Texas
Katharine Armstrong Idsal, San Antonio, Texas
19 John Avila, Jr., Fort Worth, Texas
Carol E. Dinkins, Houston, Texas (absent)
20 Alvin L. Henry, Houston, Texas
Mark E. Watson, Jr., San Antonio, Texas
21 Philip Montgomery, III, Dallas, Texas
Donato D. Ramos, Laredo, Texas
22 Joseph B.C. Fitzsimons, San Antonio,
Texas
23
THE PARKS AND WILDLIFE DEPARTMENT:
24 Andrew H. Sansom, Executive Director, and
other personnel of the Parks and Wildlife
25 Department.
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1 NOVEMBER 7, 2001
2 *-*-*-*-*
3 FINANCE COMMITTEE MEETING
4 *-*-*-*-*
5 CHAIRMAN IDSAL: I'm calling this
6 meeting back to order. And with that, I'll hand
7 it over to Ernie Angelo, the chairman of the
8 finance committee.
9 CHAIRMAN ANGELO: All right. Our
10 first item is to approve the committee minutes of
11 the previous meeting. Are there any changes or
12 corrections? There being none, they will stand
13 approved as written.
14 Item number 1 on the agenda is the
15 chairman's charges. Andy?
16 AGENDA ITEM NO. 1: BRIEFING - CHAIRMAN'S
17 CHARGES.
18 MR. SANSOM: Mr. Chairman, three of
19 the specific issues today on your agenda will be
20 presented by Gene McCarty and have to do with
21 follow-up on Sunset. They involve developing
22 guidelines for employee fund-raising, developing
23 best practices and accountability measures for
24 nonprofit partners and guidelines limiting the
25 expenditure of state monies by non-profit
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1 partners.
2 And I also would say that at this
3 time, I would like Lydia Saldana to present to you
4 the -- give you a glimpse of the two new license
5 plates for the department.
6 MS. SALDANA: First, if I could, I'm
7 Lydia Saldana, communications division director.
8 And just real quickly, if I could go over some of
9 the information on the other license plates. Of
10 course, the horned toad lizard plate was launched
11 back in October of 1999, once the 76th legislature
12 approved it.
13 Right now, we're at 20,374 in total
14 sales, which makes it the third most popular
15 specialty plate in Texas. That's about $407,000,
16 a little over $407,000 in gross revenue. This has
17 been a real money maker for the department, a very
18 successful effort and Texans just love it. You
19 can see them all over the road.
20 As directed by the Commission
21 earlier this year, we directed our efforts for our
22 second plate to benefit state parks and to go to
23 state parks. We began our efforts back in early
24 spring. We really had hoped to tune into the
25 spring wildflower season. And we ran into some
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1 production problems. And so the actual production
2 of the plate was not completed until July. So
3 we're very much on the early end of the -- you
4 know, this process.
5 To date we have sold 1,354 of the
6 bluebonnet plates benefiting state parks. We did
7 a pretty extensive marketing effort in August that
8 we're just now going to begin to see results.
9 And, of course, we'll be working on a spring
10 campaign, as well to coincide with state park
11 visitation in the spring, bluebonnet and
12 wildflower season.
13 Now, I get to do my Vanna White
14 impression. Here's what we've got on the board
15 for coming up in 2002. And when we first did the
16 research on the initial horny toad plate, what
17 came up very popular was both a white-tailed deer
18 and a bass plate. We believe there's a huge
19 market potential here. And what we're looking at
20 doing is launching these together.
21 Our marketing budget this year for
22 four plates is going to be a little bit more than
23 what we had the last year for two plates. So
24 we're going to be looking at every possible way
25 that we can market these efficiently. We believe
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1 that launching two at once is one way that we can
2 do that. I have one brochure instead of two
3 separate brochures and market to some of our key
4 market lists. Now, I will point out that these
5 are still works in progress. We're pretty happy
6 with the bass plate, but Bob Cook told us Monday
7 that this looks like a Yankee deer. So we're
8 going to be doing some cosmetic surgery.
9 These two plates and all of the
10 artwork are done by our incredible talented
11 artists that we have on staff. The horny toad
12 plate and the bluebonnet were done by Rob
13 Plumming. This artwork is being done by
14 Clemente Guzman. I think we've got some real
15 winners here. So we'll be launching these early
16 in the year. We want to take advantage of the
17 spring, you know, boating shows and that sort of
18 thing to work on marketing this plate.
19 We're in the process right now of
20 seeking a sponsor for a spring issue of Hook and
21 Bullet, which goes out to every super combo
22 license holder, which is one of our key customer
23 groups. And we want to have these marketing
24 materials in the event that does get funded ready
25 to go so we can market to that group.
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1 So there we are. Any questions?
2 MR. SANSOM: That concludes the
3 charges, Mr. Chairman.
4 CHAIRMAN ANGELO: Thank you, Andy.
5 Thank you, Lydia.
6 If there's no objection from the
7 Commission, I'd like to make a change in the order
8 of the agenda. Since we're already in the lunch
9 hour, we'd like to take up item number 3, and then
10 follow that with item number 5, and then take a
11 recess of the committee for lunch. Are there any
12 objections to that?
13 There being none, we recognize Jayna
14 Burgdorf to talk to us about the license system,
15 and also to introduce our new --
16 AGENDA ITEM NO. 3: BRIEFING - LICENSE SYSTEM
17 UPDATE.
18 MS. BURGDORF: Thank you,
19 Commissioners. Andra, is it okay if I go ahead
20 and get started.
21 MS. CLARK: Yes.
22 MS. BURGDORF: Okay. Thanks. This
23 is Terry Lewis. She's our new license system
24 manager. She's assisting with the implementation
25 and she will also be managing the contract on an
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1 ongoing basis.
2 Today, we're going to report on the
3 PC system status and the hypercom point of sales
4 terminal status.
5 The PC sales system is primarily
6 used by our law enforcement offices and by a low
7 volume license agents. And these are folks who
8 sell less than a hundred licenses a year.
9 Some of you have even purchased your
10 license from the system at the front counter.
11 It's been on sale since the end of August. We
12 have expanded that sales capability with this PC
13 system to six of our law enforcement offices. And
14 actually on a daily basis now, we are bringing
15 more law enforcement offices up online. And they
16 should be complete by the end of November.
17 We're also, by the end of November,
18 going to roll out to about 150 or so low-volume
19 retailers and have those folks up.
20 New agents, what we have found out
21 with this PC system is that it is more user
22 friendly, it has greater functionality. And so as
23 folks apply to become licensed agents that haven't
24 up to this point, we are directing them towards
25 the PC. So the new folks who start selling
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1 licenses will be hopefully using their own PC to
2 do that, as well.
3 The hypercom sales system is the one
4 that is very similar to what we have right now,
5 the veriphone equipment used by Transactive. It
6 is primarily used by our higher-volume retailers
7 in the state parks. We have the little machine
8 right over there. And actually at the break,
9 we're going to sell some licenses. So if you want
10 to see the machine actually work, live sales,
11 we'll have it here.
12 The pilot is ongoing right now at
13 our front counter. Again, that's the best place
14 for us to pilot these things. We have a lot of
15 control there. They are in the middle of
16 deploying devices, WorldCom is. They're at 714
17 devices deployed, shipped out as of the end of
18 business yesterday. That is about a quarter of
19 all the devices that we need to be shipped.
20 What happens is they're shipped in
21 training mode, and then they work with the agents,
22 the license agents, to set that machine up over
23 the phone. And then when we get -- hopefully,
24 next week, we should have the version of software
25 that will allow us to be comfortable selling --
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1 letting licensed agents out in the field sell
2 licenses live on the system. And so there will be
3 an activation that takes place. So right now when
4 they get their equipment, they're just in training
5 mode.
6 As you know, Transactive has
7 continued to sell licenses through the fall. And
8 we're pleased with that. As folks start selling
9 licenses on the new system and they're successful,
10 then Transactive will go pick up the old terminal,
11 settle it, and they will basically close out
12 within about two months.
13 Although we do not anticipate
14 needing to continue with Transactive past
15 December, they have agreed, if necessary, to
16 continue through April. And WorldCom has also
17 agreed to reimburse Parks & Wildlife for those
18 contingency costs.
19 There are some other aspects of the
20 system that are important, and those are rapidly
21 coming into place, as well. Right now, we're just
22 focusing on recreational license sales. But the
23 commercial license sales capability should be here
24 by late December. The ability to purchase a
25 license over the phone through our call center,
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1 and the ability for someone at their own home
2 computer to purchase a license over the Internet,
3 again, both of those, the call center on the
4 Internet has to be fulfilled so that you get your
5 actual license with the tags on it. But those --
6 both of those capabilities should take place in
7 December and January. So that's the schedule.
8 And in spite of the delays, you
9 know, we want to tell you that we are excited
10 about the new system. We've got what we think is
11 a really neat looking license with the tags around
12 the body of the license. We believe we're going
13 to have much more accurate data in the database.
14 When you go to swipe your driver's license, there
15 will be many instances of finding you as a
16 customer and populating that name and address
17 field so that there's no chance that the, you
18 know, clerk might accidentally mistakenly enter
19 the wrong address, et cetera.
20 Hunter education requirements are
21 printed on the license. And it does address the
22 license system related audit issues.
23 And Terry and I will be happy to
24 answer any questions.
25 CHAIRMAN ANGELO: Do we have any
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1 questions, Madam Chairman?
2 CHAIRMAN IDSAL: Yes, Mr. Chairman.
3 I would like to -- the number of devices that went
4 out yesterday was what?
5 MS. BURGDORF: Representing a total
6 of three days, the cumulative total of three days
7 is 714.
8 CHAIRMAN IDSAL: And when do you
9 expect we'll be getting some feedback on how
10 that's going?
11 MS. BURGDORF: I actually expect
12 that we'll getting feedback pretty quickly. Our
13 sense is that the installation call is not going
14 to be the most confusing aspect. You know, they
15 will walk them through, "Here is how you put the
16 paper in, here is how you put the ribbon in."
17 And we think that will go pretty
18 well, although we should start hearing very soon.
19 We've got some of our licensed deputy advisory
20 committee members on tap to give us feedback.
21 What we will probably hear more about is when we
22 go to actually activate these people and they're
23 really selling licenses. And it just may be the
24 change.
25 You know, they might not be used to
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1 how to work the new system, although they have got
2 the opportunity to view the training video and to
3 attend a training class. So we're hoping that
4 that will help overcome any newness that they feel
5 with the system.
6 CHAIRMAN IDSAL: By next week, you
7 expect information will be dribbling in or pouring
8 in or --
9 MS. BURGDORF: Oh, yeah. Well, we
10 are actually talking to them today about a
11 specific activation strategy that might involve
12 one of our corporate partners, like Academy,
13 because then we're dealing with one headquarters
14 who has the capability to transmit to a number of
15 stores and receive feedback very quickly from them
16 if they encounter any problems. So that's what
17 we're working on and we'll phase it in next week
18 and we will keep it informed.
19 CHAIRMAN ANGELO: Any other
20 questions? If not, Jayna, we thank you very much.
21 And you have a -- your conference call with
22 WorldCom is regarding what?
23 MS. BURGDORF: It's actually we have
24 daily conference calls.
25 CHAIRMAN ANGELO: It's a daily
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1 thing. And you're just continuing. Okay. Very
2 good.
3 MS. BURGDORF: Thanks.
4 CHAIRMAN ANGELO: All right. And
5 then we'll take up item number 5, Frances? This
6 is the approval of the artwork design.
7 AGENDA ITEM NO. 5: BRIEFING - ARTWORK APPROVAL.
8 MS. STILES: Good morning. My name
9 is Frances Stiles and I'm with the administrative
10 resources division. I have with me Mr. Bubba Wood
11 from Collector's Cubby to present the artwork.
12 MR. WOOD: The duck stamp art this
13 year is the work Joe Hawkman. He is the third of
14 the Hawkman brothers, all of whom won the -- have
15 won the federal duck stamp contest. The other two
16 have done the duck stamp for us before. Jim
17 Hawkman has won three times. His brother, Bob,
18 has won twice. And Joe is, of course, the black
19 sheep who has only won once. But we're the only
20 state -- and I don't know what this is worth --
21 probably not much -- that have used all three
22 artist -- at least that I'm aware of, that have
23 used all three of the Hawkman boys.
24 The second print is the turkey stamp
25 print, of course, by John Deerman, who had done a
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1 turkey stamp for us before. I think it was the
2 1991 one. The first state turkey stamp print was
3 done by John Deerman. And the saltwater stamp is
4 also done by John Deerman this year. And it's a
5 flounder. And, yes, it's ugly. But we have
6 probably had more requests by people, you know,
7 just -- in numbers, I would say 25 over the years,
8 have said, "God, you really ought to do a flounder
9 because more people fish for flounder on the coast
10 than almost anything. Well, here he is.
11 CHAIRMAN IDSAL: He nailed him.
12 That's him.
13 MR. WOOD: And, of course, and our
14 fourth is our non-game stamp. Now, most of
15 you-all would think that that's a gamble's quail.
16 But that's really an Avocet that hadn't quite made
17 it yet. I had Sherry Russell Malean paint a
18 gamble's quail for us, knowing that, of course,
19 you can't hunt gamble's quail in Texas and we've
20 already used the Vernon's quail as a non-game, you
21 know, back when the non-consumptive user gave us
22 new meaning to non-comsumptive user, meaning they
23 don't buy the stamp prints. We decided we'd try
24 to use game birds like Mearns quail. And always
25 in the back of my mind -- and, of course, we did
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1 the gamble's quail because it's even prettier.
2 And finally, we did it. And thank goodness
3 Frances called me the day I called to tell her
4 that we had this beautiful gamble's quail for the
5 non-game stamp to tell me that the gamble's quail
6 was a game bird. Of course, being a girl, I
7 didn't believe her. And I told her to, you
8 know --
9 Anyway, as it turned out, she was
10 right. I mean, real right. In fact, my biologist
11 in Alpine told me that in 1990, the first -- I
12 think the first year of the type II public land
13 hunting, that he and a friend three days in a row
14 killed limits of gamble's quail in Texas, killed,
15 in effect, their possession of 45. So so much for
16 me as a bird authority or a game bird authority.
17 So we're in the process of, if you can imagine,
18 lengthening that quail's leg by about five inches
19 and lengthening his bill about five inches and
20 painting him apricot instead of this silly color
21 they have him painted now, he'll be an Avocet.
22 And hopefully by the first of December we'll,
23 Avocet. And this will go on to fame as a quail
24 stamp print. Always one to make chicken salad out
25 of chicken feathers, we're going to use it as a
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1 quail stamp print, which we do for Quail
2 Unlimited.
3 But I stand before chagrined and
4 thankful to Frances because believe me, this is
5 going to be a non-game stamp.
6 CHAIRMAN ANGELO: Bubba, we always
7 appreciate your unorthodox and entertaining
8 presentations.
9 MR. WOOD: I don't want y'all to
10 really focus on the reality that every year our
11 royalty payments go down a little. You know,
12 that's the way we clowns are. You know, we try to
13 divert the attention. Keep the bull's attention
14 on something else.
15 CHAIRMAN ANGELO: It's a worthwhile
16 effort.
17 MR. WOOD: Thank you. Anyway, I can
18 assure you -- by the way, Sherry Russell did our
19 hooded merganser a couple of years ago in the duck
20 stamp. And she's an exquisite duck stamp
21 designer. And, you know, really has nation --
22 probably has done as many duck stamps as almost
23 any artists on a nationwide basis, although she's
24 hasn't won the federal duck stamp.
25 Anyway, I'm sorry that we don't have
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1 the art here, but -- in fact, Hal, how would you
2 suggest it? Do we need to present it back to the
3 Commission or can we -- can I send you a picture
4 of it, Madam Chairman?
5 CHAIRMAN IDSAL: I think I want you
6 to come back.
7 MR. WOOD: Right.
8 CHAIRMAN IDSAL: You don't need to
9 come back. If you could send a picture or --
10 MR. WOOD: If I send it to you, can
11 you just e-mail it to all of them?
12 CHAIRMAN IDSAL: Sure would.
13 MR. WOOD: Great.
14 CHAIRMAN ANGELO: I know we talk
15 about this every time. But is -- there's
16 obviously -- you haven't had any additional
17 thoughts of how we could promote the sale,
18 particularly, of the nongame stamp any more than
19 what's been done? Is that right or not?
20 MR. WOOD: You know, the duck stamp
21 phenomenon and the print phenomenon as a
22 collectable is -- every year is one of attrition
23 and we just truly try to do the best we can to,
24 you know, stop the bleeding as much as we can.
25 And all the Texas programs are still
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1 the biggest. But, I mean, we would be tickled to
2 death to spend the money -- I mean, one thing that
3 would help would be, you know, more exposure in
4 the department in the magazines and stuff.
5 You've got these great images that
6 the department owns the copyright of, you know,
7 clearly the best collection of stamp art times ten
8 of any other state, and mainly because the
9 Commission a long time ago had the wisdom to say,
10 "Hey, let's pick the best artist and get the best
11 art," not -- you know, not perhaps use only local
12 artists or something.
13 And it's just a shame that you-all
14 don't use those images more to promote, you know,
15 license plates or anything, you know. I mean, I
16 think the license plate deal is a terrific idea.
17 But it sure would be neat to see a duck stamp on
18 it. Or see an image, not the duck stamp. See a
19 duck on it, you know, sometime in the future.
20 You know, the catalog now has
21 posters. And the people that did those did a
22 terrific job. I hear they're selling fairly well.
23 But, Commissioner Angelo, you know, I -- I don't
24 think I wake up every day during bird season
25 thinking about non-game bird sales.
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1 At the time we did the non-game, the
2 Audibon Society and the non-consumptive users
3 really, you know, gave their absolute best effort
4 to try and get this off the ground, but it just
5 was a bad idea whose time had come, you know.
6 CHAIRMAN ANGELO: Frances, do you
7 have any other ideas on that, or the
8 non-consumptive or especially the non-game?
9 MS. STILES: One of the things that
10 I have here is what we've done this last year, is
11 to create a historical poster of the waterfowl
12 stamps. And that's an idea that could go into any
13 of the other stamps, as well. I just wanted to
14 give you an example of that. And that's a poster
15 that Mr. Wood worked the catalog very closely to
16 improve upon. And that has -- it's only been in
17 the last three drops of the catalog, and that has
18 picked up the sales. Out of all the waterfowl
19 stamp artwork or the waterfowl merchandise, it's
20 been one of the better performers on that. And we
21 certainly have all the artwork on the non-game
22 that can be used in any manner.
23 CHAIRMAN ANGELO: Any other
24 questions or comments? Let's see, what do we need
25 we need to do -- do we need to take? Action on
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1 some -- yes. If there's no further questions or
2 discussion, without objection, this item will be
3 placed on the Thursday commission agenda for
4 public comment and action? That being done, we
5 thank you all.
6 MR. WOOD: Thank you.
7 CHAIRMAN ANGELO: Thank you, Bubba.
8 At this point, the finance committee will recess
9 for the lunch break and we will come back and
10 reconvene thereafter. And Madam Chairman?
11 CHAIRMAN IDSAL: I think I'm doing
12 this right. I have to convene the conservation --
13 no, no. I have to announce that pursuant to the
14 requirements of Chapter 551, Government Code,
15 referred to as the Open Meetings Law, an executive
16 session will be held at this time for the purpose
17 of consideration of Section 551.071 of the Texas
18 Open Meetings Act regarding pending litigation and
19 legal advice in Section 551.072 of the Texas Open
20 Meetings Act regarding real estate matters. Is
21 that it?
22 MR. SANSOM: That's it.
23 (RECESS.)
24 CHAIRMAN ANGELO: The Finance
25 Committee will reconvene after recessing, and pick
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1 up Item Number 2 going back to the regular order
2 of the agenda. And ask Suzy Whittenton to give us
3 a financial review and an update.
4 AGENDA ITEM NO. 2: FINANCIAL REVIEW AND
5 UPDATE.
6 MS. WHITTENTON: Thank you,
7 Mr. Chairman, Commissioners. For the record, my
8 name is Suzy Whittenton. The focus of the
9 presentation today will just review current fiscal
10 year revenue, including Big-Time Texas hunts and
11 cover operating budget status. And then I'd like
12 to finish up with a report on how we're addressing
13 any audit issues in the State Auditor's report.
14 The state park revenue for September
15 was down about 13 percent from the previous year.
16 We think that there are two factors that
17 contributed at least partly to that. One was that
18 Labor Day weekend actually began on Friday, August
19 the 31st. So for those people who paid for the
20 entire weekend on Friday, that revenue got
21 recorded in August instead of September.
22 And then we also experienced some
23 cancellations immediately after the September 11th
24 tragedy. I've got some preliminary information in
25 on the October revenue for State Parks. And it
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1 looks like business picked up considerably in
2 October in parks. The revenue should be -- they
3 haven't verified all the numbers yet, but they're
4 somewhere between 15 and 20 percent higher than
5 last year. So we're not concerned about September
6 being down at this point. In account 9 --
7 COMMISSIONER MONTGOMERY: Are you
8 saying we're going to make that up in October?
9 MS. WHITTENTON: Uh-huh.
10 COMMISSIONER MONTGOMERY: Okay.
11 MS. WHITTENTON: We think so. The
12 numbers -- it's early yet on those numbers, but I
13 got a draft report right before I came down here.
14 And it looked like -- not all the parks were in
15 yet, information in yet on the report, but it
16 looked like it was a good month for most parks.
17 In account 9, we keep boat revenue
18 and license revenue. Revenue from boat
19 registrations was down in September by about 16
20 percent. And it appears to be down in October, as
21 well. We suspect that this is due to the cooling
22 economy, what with boats being more or less luxury
23 items for people.
24 Last year we had revenues of $13.9
25 million from the source. And the current revenue
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1 estimate for the current fiscal year was 13.5
2 million. So we started out projecting that it
3 would be lower. But at this current -- if the
4 trend continues the way it has, we may not reach
5 that estimate, if things don't turn around with
6 registrations.
7 Not that many boats are registered
8 this time of year. The majority of them happen in
9 the March, April, May time period. So it's really
10 too early to know what's going to happen on boat
11 revenue.
12 CHAIRMAN ANGELO: What would you, if
13 you had to estimate today, estimate the shortfall
14 to be in that --
15 MS. WHITTENTON: I think it could be
16 $2-$3 million if this trend continued. It looks
17 like October's numbers are down about 25 percent.
18 So --
19 COMMISSIONER MONTGOMERY: Excuse me
20 for not knowing. But what is the period of
21 registration? Is it annual?
22 MS. WHITTENTON: It's a two-year
23 registration. And so that's why you see some
24 fluctuations from year to year. But if you're not
25 going to use your boat, you might not register it
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24
1 until you're ready to put it back on the water.
2 You know, the game warden will notice it when they
3 pull up to your boat. But other than that, I
4 don't think -- you could register it late.
5 COMMISSIONER MONTGOMERY: I wonder
6 if it's an enforcement question or if it really is
7 a sales of new boats question.
8 MS. WHITTENTON: And a lot of them
9 are renewals. And then I suppose there are people
10 who may not renew, wondering whether they're going
11 to keep their boat or not. I really don't know.
12 CHAIRMAN ANGELO: But the
13 registration period is different for each person?
14 I mean, it's not something --
15 MS. WHITTENTON: It's just like
16 vehicle registrations.
17 CHAIRMAN ANGELO: It's not a set
18 rate.
19 MS. WHITTENTON: Yeah.
20 COMMISSIONER FITZSIMONS: It's not
21 like August where everything rolls over. It's --
22 between sales and registration. The bulk of them
23 have got to be current boats. Sales -- it seems
24 you can't move it that much, have that big a gap.
25 And if it's potentially a $2-$3 million dollar
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1 problem, we ought to figure out exactly what is
2 the problem and where is it coming from. And if
3 it is an enforcement problem, we ought to pay
4 attention to it.
5 CHAIRMAN ANGELO: You're suggesting
6 that maybe they're not registering them and still
7 using them.
8 COMMISSIONER MONTGOMERY: I'm
9 wondering. I'm just thinking we ought to study
10 this a little bit. If it's on that order of
11 magnitude, somebody ought to -- we ought to put
12 some people on it to figure it out.
13 COMMISSIONER AVILA: That's
14 probably --
15 CHAIRMAN ANGELO: It makes sense
16 that there are that many fewer boats.
17 MS. WHITTENTON: Well, and it may be
18 that they're just waiting to register until later
19 in the year.
20 COMMISSIONER FITZSIMONS: It's like
21 an economic indicator.
22 MS. WHITTENTON: Right.
23 COMMISSIONER FITZSIMONS: People are
24 starting to hold back. Just like going on
25 vacation, you -- people say --
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1 COMMISSIONER MONTGOMERY: But
2 entertainment and recreation close to home does
3 better in bad times, not worse because it's
4 cheaper and closer.
5 COMMISSIONER RAMOS: Well, I don't
6 know if boating is as popular in the winter months
7 as it is in the summer months.
8 CHAIRMAN ANGELO: We're talking
9 about a 20 percent drop. Is that --
10 COMMISSIONER MONTGOMERY: You're
11 talking about year-to-year comparisons, though.
12 MS. WHITTENTON: Year-to-year
13 comparisons. When you look at September of this
14 year --
15 COMMISSIONER RAMOS: Goes into it.
16 COMMISSIONER MONTGOMERY: I think we
17 ought to study that, try and figure out what it
18 is.
19 MS. WHITTENTON: Right. Well, we
20 can certainly try talking to some of the people
21 and look at -- and maybe look into whether there
22 are -- if -- look at the difference between new
23 boat registrations and renewal registrations, and
24 see if there's some --
25 CHAIRMAN ANGELO: How much of it is
.
27
1 one or the other.
2 MS. WHITTENTON: We'll do that.
3 On the flip side, license sales have
4 been good this license year. Super combo sales
5 continue to grow with a -- we've got about a 6.3
6 percent increase this year over the same period
7 last year. We sold about a million and a half
8 licenses, stamps, and permits, at least we had as
9 of October 23rd.
10 Hunting licenses, hunting license
11 sales are up also as of the 23rd of October.
12 Total hunting licenses sold, including combos,
13 were up 2.3 percent over the same period last
14 year. And we've sold almost 700,000 hunting
15 licenses.
16 Fishing licenses are also up.
17 They're up just over 3 percent, even with
18 saltwater stamp sales being down. Of course, this
19 takes into account the combo sales. And we've
20 sold at least over 800,000 fishing licenses.
21 And as expected, the revenue from
22 license sales is up by 2.3 percent for about
23 816,000. We collected a total of about $37
24 million as of October 23rd, which is more than
25 half of what we'll collect all year.
.
28
1 COMMISSIONER FITZSIMONS: I see the
2 resident is up 2 percent. Is nonresident about
3 the same? I really can't tell.
4 MS. WHITTENTON: Yeah. I just
5 didn't put it on the slide. Nonresident was up --
6 I'm sorry. Nonresident was actually -- on fishing
7 licenses was actually down a little bit.
8 COMMISSIONER FITZSIMONS: And
9 hunting -- and how about nonresident hunting?
10 MS. WHITTENTON: Nonresident hunting
11 was --
12 COMMISSIONER RAMOS: Up 2.9, it
13 says.
14 MS. WHITTENTON: Was up 2.9 percent.
15 COMMISSIONER FITZSIMONS: Oh, I got
16 it.
17 COMMISSIONER MONTGOMERY: What
18 happened to saltwater stamp? Why are they down so
19 much?
20 CHAIRMAN ANGELO: Some of it is
21 absorbed in the super combo.
22 COMMISSIONER MONTGOMERY: Most of it
23 is switching over.
24 MS. WHITTENTON: And when you look
25 at these charts, it actually show total numbers of
.
29
1 licenses sold. It's just sort of misleading
2 because if you used to buy a hunting license and
3 two stamps, that counts as three purchases. And
4 then this next year, you buy a super combo.
5 You're only buying one, so they aren't -- it
6 doesn't mean as much as what happens in revenue.
7 But revenue is up overall because -- because
8 partly because of that shift -- continued shift to
9 the super combo.
10 CHAIRMAN ANGELO: While we're
11 looking at stamp allocations, I assume we're
12 phasing in or looking at the salt -- the effect on
13 the saltwater stamp, too, since we raised that for
14 specific purposes. Is that correct?
15 MS. WHITTENTON: Right. Now, the
16 saltwater stamp is -- it's not statutorily
17 dedicated, so it's, you know, in a different
18 category, but I'm sure that --
19 CHAIRMAN ANGELO: We raised the
20 amount for a specific reason there.
21 MS. WHITTENTON: Right.
22 CHAIRMAN ANGELO: And if people are
23 shifting into combo to avoid buying the stamp
24 individually, then it's definitely going to have
25 an adverse effect on the amount of money going
.
30
1 into that fund.
2 MS. WHITTENTON: That's true.
3 CHAIRMAN ANGELO: To the extent we
4 could identify that.
5 MS. WHITTENTON: Right. Just the $3
6 increase to the saltwater stamp. And we do keep
7 that in a separate place and keep it set aside for
8 the use of the buy-backs. But, yeah, we can look
9 at that and study that allocation.
10 CHAIRMAN ANGELO: We need to keep an
11 eye on that.
12 MS. WHITTENTON: A quick look at
13 super combo sales since inception shows that sales
14 continue to grow. You can see that in the first
15 four years, super combo sales more than doubled
16 between 1997 and 2001. And we expect to sell
17 around 350,000 super combos this year, 2002.
18 And, again, when you look at a
19 comparison from this year to last year over that
20 same period of time as of October 23rd, sales are
21 up 6.3 percent or nearly 18,000 actual sales.
22 In Big-Time Texas Hunts this year,
23 we added two new hunts, the Texas premium buck
24 hunt and the Texas heritage hunt. We also
25 enhanced some of the existing hunts by adding
.
31
1 companion hunting privileges for the 20 whitetail
2 Bonanza hunts.
3 We also continued the successful
4 direct mail strategy that we used in prior years,
5 which was that we mailed personal letters,
6 postage-paid return envelopes in August. And then
7 we sent out reminder letters in October to those
8 who had not yet responded.
9 The results -- applications had to
10 be postmarked by November the 3rd, so we were
11 still getting them in even yesterday. And quickly
12 trying to enter them in our license sales system.
13 As of the end of October, we had
14 about 76,000 entries. And as of this morning, I
15 heard that we were estimating that we would have
16 about 86,000 total entries once we get them all
17 entered in the system. So we would be continuing
18 on about the same growth rate that we had last
19 year, which would be somewhere between, say, 9 and
20 11 percent growth rate.
21 And when you look at which hunts are
22 most popular, the grand slam, the white-tailed
23 Bonanza continued to sell well. And then the new
24 premium buck hunt was popular, as well.
25 In operating budget, at the end of
.
32
1 September we had spent all but about 2.4 percent
2 or about $4 million of our operating budget funds
3 for 2001, which means that we will have spent
4 almost 98 percent of everything we budgeted.
5 If you'll remember, in the summer we
6 did something of a hiring slow down, and we
7 delayed purchases on items that we could, that we
8 didn't absolutely -- that weren't critical. And
9 that generated some of the additional unspent
10 operating budget.
11 I believe Mr. Sansom has recommended
12 that we consider using this on a game warden
13 academy starting in March that was not budgeted in
14 the original 2002 budget. Some of this $4
15 million, we did plan on in the -- when we prepared
16 our 2002 budget. But there is additional money
17 there that we weren't sure we would have.
18 COMMISSIONER MONTGOMERY: Different
19 numbers are shown on the screen.
20 MS. WHITTENTON: I'm sorry. The
21 slides were printed. I made a change in that last
22 night. It was an overstatement in the old slide.
23 This is the correct number.
24 COMMISSIONER MONTGOMERY: Okay.
25 What is a lapse in the budget?
.
33
1 MS. WHITTENTON: That's just
2 unspent. And that doesn't mean that -- I mean, it
3 rolls over, can be carried forward to other years.
4 But that's just an accounting term we use in
5 government. We lapse unspent money.
6 COMMISSIONER MONTGOMERY: Unspent
7 money from last year?
8 MS. WHITTENTON: Yes.
9 COMMISSIONER MONTGOMERY: And we
10 have the authority to carry it forward?
11 MS. WHITTENTON: Yes.
12 COMMISSIONER MONTGOMERY: Did we
13 take it into the budget we passed in August?
14 MS. WHITTENTON: We took some of it
15 into account. About a million and a half of it we
16 were counting on in the 2002 budget. So there is
17 some additional money there that could be
18 reallocated.
19 COMMISSIONER MONTGOMERY: Okay. How
20 does that --
21 CHAIRMAN ANGELO: And what are you
22 estimating that amount to be?
23 MS. WHITTENTON: It will probably be
24 between two and a half and three million. We
25 don't know for sure how much of that is left
.
34
1 because what happens is, you get bills in after
2 the end of August that apply to --
3 CHAIRMAN ANGELO: Previous.
4 MS. WHITTENTON: Yeah. And we have
5 some bills that really drag in. And so -- and
6 each division doesn't unbudget those amounts right
7 away. So we won't know -- I suspect by the end of
8 November, we'll have a really good idea of what's
9 not going to get spent. We do have some --
10 MR. SANSOM: This resulted,
11 Commissioner Montgomery, if you recall, back in
12 the early part of the summer when we began to see
13 what was coming.
14 COMMISSIONER MONTGOMERY: Yeah.
15 MR. SANSOM: We just shut down
16 everything.
17 COMMISSIONER MONTGOMERY: Right.
18 MR. SANSOM: We shut down hiring.
19 We shut down purchasing. And it created what we
20 termed "lapse."
21 COMMISSIONER MONTGOMERY: So right
22 now which funds -- which funds and which accounts
23 it's in, it has to come back before the Commission
24 before it's allocated?
25 MS. WHITTENTON: We would have to
.
35
1 have --
2 COMMISSIONER MONTGOMERY: Does it go
3 back to the budget process? What's our process
4 here?
5 MS. WHITTENTON: If we were going to
6 rebudget any of it, like for the game warden
7 academy, we would have to have the signatures from
8 the Chairman of the Commission and the Chairman of
9 the Finance Committee in order to budget anything
10 over $250,000.
11 COMMISSIONER MONTGOMERY: Okay.
12 MS. WHITTENTON: And then anything
13 over, I believe, 150,000 we would have to at least
14 notify you on. Most of that is in fund 9 of the
15 $4 million. Let's see. And some of it -- of
16 course, some of it's also in dedicated amounts.
17 So some of it would not be allowed to be allocated
18 to other things.
19 COMMISSIONER MONTGOMERY: Right.
20 MS. WHITTENTON: But there's
21 probably going to be about a million or so in 9.
22 And if we were going to fund a game warden
23 academy, we would have to fund it out of fund 9.
24 CHAIRMAN ANGELO: That's an
25 approximate of how much?
.
36
1 MS. WHITTENTON: Well, just to cover
2 the salaries for the cadets for a six-month period
3 of time and some minor operating expenses, some
4 travel for those cadets, we'd need probably about
5 $700,000.
6 CHAIRMAN IDSAL: But that would not
7 include equipment and whatnot that they would
8 need?
9 MS. WHITTENTON: That is correct.
10 It would not include money for vehicles or boats
11 or -- I think that included some equipment for
12 vests, the bulletproof vests, and some of the more
13 minor equipment. And they -- the game wardens are
14 expecting that there's a good possibility that
15 there may be some -- a large number of retirements
16 in August. If they're right about that, then
17 there will be equipment available to pass on to
18 the cadets once they graduate.
19 COMMISSIONER MONTGOMERY: When we
20 passed the budget, we did not prioritize optional
21 projects. We just stopped all the capital. And
22 what we said then was that we'd watch it during
23 the year and circle back around late in the
24 year --
25 MS. WHITTENTON: Right.
.
37
1 COMMISSIONER MONTGOMERY: -- review
2 and reprioritize. So I guess -- I want to think
3 out loud about what we were doing here because I
4 think there's -- it's real easy for the
5 presumption to occur that we are going to do this
6 or that with it. But I think we described a
7 pretty clear methodology.
8 Correct me if I'm wrong. I'm just
9 trying to remember back. I want to stick to that
10 because with the sliding revenues, you know, that
11 could evaporate just to operate. So I don't want
12 to get everybody's hopes up on certain things here
13 and there.
14 CHAIRMAN ANGELO: Well, some of
15 these other things we've talked about that are
16 down could definitely offset that.
17 COMMISSIONER MONTGOMERY: So we're
18 in sort of unchartered economical water these
19 days.
20 COMMISSIONER FITZSIMONS: Your point
21 being until it settles out, then we --
22 COMMISSIONER MONTGOMERY: Well, I
23 think we set out a process. We've held all the
24 capital off. Let's wait to see where we get
25 through the year and see how it goes, and then
.
38
1 make capital decisions. But let's don't jump the
2 gun because we're only part way into the year
3 right now.
4 COMMISSIONER FITZSIMONS: That's a
5 good point.
6 CHAIRMAN ANGELO: That decision, if
7 the game warden academy was considered -- you
8 know, a recommended action, when would that have
9 to be decided in order to make the game wardens'
10 academy possible?
11 MS. WHITTENTON: Maybe somebody from
12 law enforcement can speak to that better.
13 MR. SANSOM: You'd have to do it
14 before March.
15 MS. WHITTENTON: The hiring process
16 is actually fairly long, fairly lengthy for the
17 cadets. Of course, I guess, they wouldn't
18 necessarily -- they could go ahead and start that
19 process just in case we end up with the money.
20 But they go through a very thorough process of
21 evaluating lots of applications and making
22 selections.
23 CHAIRMAN ANGELO: Commissioner
24 Montgomery's point is that today we don't know
25 what we need to know to make that decision.
.
39
1 COMMISSIONER MONTGOMERY: I'm not
2 for or against anything because I haven't studied
3 any of them, other than the ones that were on the
4 table in the summer. We really didn't get to
5 study those because we couldn't afford them. So I
6 just want the opportunity to study from a policy
7 standpoint our choices, and only make those
8 decisions when we're forced to by timing. But
9 also when we get a better feel for where we are --
10 COMMISSIONER RAMOS: Do we have
11 historical data as to what it costs to train a
12 cadet?
13 MS. WHITTENTON: I'm sure we do.
14 COMMISSIONER RAMOS: That's all
15 right. I don't need that. Okay. So that could
16 be quantified?
17 MS. WHITTENTON: Uh-huh.
18 COMMISSIONER RAMOS: Okay.
19 CHAIRMAN ANGELO: Go ahead, Suzy.
20 MS. WHITTENTON: Okay. This is
21 actually my last slide here. I just wanted to
22 wrap up by discussing the progress and plans that
23 we have for discussing the audit issues. We're
24 aggressively addressing every issue, and we are
25 taking the state auditor's recommendations very
.
40
1 seriously.
2 So I just wanted to report to you on
3 where we were on each major point. On the license
4 sales system, the issues and concerns that were
5 raised were regarding the transactive system. And
6 we've addressed all of those issues in the
7 WorldCom system. There are a couple that we're
8 still working on, but they're all on the list to
9 be handled in the new system.
10 Regarding the stamp allocation, we
11 discussed that a little bit earlier. And you'll
12 remember we've talked about it in the last couple
13 of commission meetings, that we are currently
14 collecting data to try to support any possible
15 changes that may be needed to the method of
16 allocation of those super combo revenues to
17 dedicated stamp funds. The wildlife division is
18 handling that.
19 On the mail room processes that were
20 identified, they were corrected back in May, and
21 so we are in full compliance with the state
22 auditor's recommendation on mail room processes.
23 Auditors also identified some
24 processes that they labeled as nonvalue added in
25 the revenue department. We have been reviewing
.
41
1 those recommendations, and we'll make necessary
2 changes; some of which can't be made until after
3 some automated interfaces are developed. Some of
4 their recommendations were regarding some dual
5 entry that we're having to do because some of our
6 systems don't interface.
7 On the reconciliation issue, the
8 state auditor identified amounts that were
9 unreconciled between two accounting systems. The
10 revenue has been reconciled down to less than 1
11 percent difference and we recently brought in some
12 additional temporary resources to help us wrap up
13 the backlog of reconciliation -- unreconciled
14 items that date back to 1998 when the system was
15 first brought up. And they just got behind on
16 reconciliation, so --
17 CHAIRMAN ANGELO: The temporary
18 resources being people. Right?
19 MS. WHITTENTON: Right. We've got
20 four people who are in a room, and they are doing
21 nothing but working on this reconciliation. And
22 so we hope to have -- they were estimating that
23 they could finish the bulk of it by the end of the
24 calendar year.
25 And then on revenue forecasting, we
.
42
1 are currently documenting our methodology and we
2 continue to work with the Comptroller's revenue
3 estimating staff on our revenue estimates to make
4 sure that we're very close on those numbers. And
5 then probably the issue that's going to take the
6 most amount of time is developing the automated
7 interfaces so that all our systems talk to each
8 other and that will cut down considerably on any
9 unreconciled items, that the systems immediately
10 transfer information to each other. They won't be
11 unreconciled. And that was all I had, unless
12 there are any additional questions.
13 CHAIRMAN ANGELO: Any questions or
14 comments on this item? If not, Suzy, thank you.
15 And we'll move on to Item Number 4, which again is
16 a presentation by Suzy and Walt Dabney. Walt, do
17 you want to come up at the same time or --
18 COMMISSIONER MONTGOMERY: Can we get
19 a report in January on that license decline --
20 license -- boat registration licensing decline?
21 MS. WHITTENTON: Sure, sure.
22 COMMISSIONER MONTGOMERY: Okay.
23 Thanks.
24 AGENDA ITEM NO. 4: BRIEFING - BOAT
25 FEES/PARK FEES.
.
43
1 CHAIRMAN ANGELO: Suzy and Walt are
2 going to present separate reviews of information
3 regarding the potential of various fee increases;
4 in Suzy's case, with the boat registration, and
5 with Walt with park fees. So we'll -- Suzy, why
6 don't you take it first.
7 MS. WHITTENTON: Okay. As we've
8 discussed in the past couple of meetings, we
9 were -- the staff is reviewing our fees in all
10 categories. And so today, I'll just go through a
11 summary of what we've looked at on the boat fees.
12 Current registration fees are as
13 follows. They are charged every other year by
14 size of the boat. And they range anywhere from
15 $25 for a two-year registration to $70 for a
16 two-year registration.
17 The livery vessels category is used
18 to charge boat owners who rent out their boats
19 to -- actually we only use this for the small, the
20 Class A boats. So if you rent out a jet ski or
21 small boat, you would be charged the livery vessel
22 fee rather than the Class A fee.
23 And the dealer/manufacturer license
24 is not a required fee, but it allows a dealer or
25 manufacturer to use one registration for all of
.
44
1 their boats. And if they wanted to demo them on
2 the lake, they would use that same registration
3 number.
4 We also charge $5 transfer fees when
5 boats are sold or otherwise transfer ownership;
6 $15 title fee; $25 for a quick title; duplicate
7 fees and other small fees cover administrative
8 expenses.
9 The last fee increase we did was in
10 1996, which resulted in an increase in fees
11 anywhere between $6 to $25 registration fee, which
12 was a range of 30 percent to 60 percent, depending
13 on the type. Since 1972, we've reviewed and
14 changed fees an average of every eight years. It
15 will now be about six years since the last change.
16 We looked at comparisons to all
17 other states. The top five states in terms of
18 number of boats registered are Michigan,
19 California, Florida, Minnesota, and Texas.
20 Comparison to other states are difficult because
21 most other states don't charge -- they use
22 different methods to charge registration fees.
23 They either use different classifications or
24 additional fees are tacked on.
25 In Florida, they charge higher fees
.
45
1 in all categories. They range anywhere from, when
2 you put it on an annual basis, $14 a year to $126
3 a year. They're particularly -- they're much
4 higher than the large boat category. California
5 charges just a $5 registration fee, but then they
6 also charge a personal property tax on top of
7 that, and then a one-time trailer fee.
8 Michigan fees range from $5 a year
9 to $121 a year. But then their smaller boats
10 are -- cost less to register, but their large
11 boats are much higher. In Minnesota, they are
12 lower in all categories.
13 And then we looked at neighboring
14 states. Oklahoma was one that we looked at. They
15 base their's on the purchase price of the boat.
16 And so if you bought a boat for $15,000, your
17 registration fee would be $150 for the year. And
18 then they reduce it 10 percent each year. It's
19 sort of a depreciation. So it's considerably more
20 in Oklahoma than in Texas.
21 I also wanted to consider the
22 registration fees we pay in Texas on our vehicles.
23 These are annual fees as opposed to our two-year
24 fees. But most people in Texas actually pay more
25 to register their boat trailers than they do their
.
46
1 boats. And these vehicle registrations are based
2 on weight, I believe.
3 The vast majority of our boat
4 revenue comes from registrations, and only about
5 20 percent from titling, and then very little from
6 the other categories. This graph shows
7 boat-related revenue over an eight-year period.
8 Since the last fee increase in '96, boat fees
9 bring in an average of $13.8 million per year.
10 And that last fee increase resulted in about an
11 extra $4 million.
12 We provide a number of services to
13 the boating public, primarily by the game wardens
14 working on the lakes. But we also do boating
15 safety and other administrative functions. And
16 over the last few years and in the coming years,
17 we've had some increased cost related to boating.
18 These were just a few that I came up with fairly
19 quickly.
20 COMMISSIONER MONTGOMERY: Suzy, as I
21 understand it, the budget we passed -- and, Jim,
22 correct me if I'm wrong -- but we don't have
23 anything to allow for the economic depreciation of
24 our -- the boats that our wardens are using.
25 Right?
.
47
1 MS. WHITTENTON: That's right.
2 COMMISSIONER MONTGOMERY: There's
3 no -- nothing in the budget for that. So we've
4 got an aging fleet.
5 MS. WHITTENTON: That's right.
6 COMMISSIONER MONTGOMERY:
7 Economically depreciating boats, and we're not
8 allowing for it right now, we're not recovering
9 that cost or we're not seeking for any budget
10 right now for new fleet purchases?
11 MS. WHITTENTON: Right. Not for
12 boats.
13 CHAIRMAN ANGELO: One of the key
14 things I think we need to recognize here is that
15 we are providing significant services to the
16 boating public, which is part of what you're
17 getting at. And that's the justification for the
18 fees at whatever level they are set, is to attempt
19 to recover some of the cost of providing the
20 services to the public that uses --
21 COMMISSIONER MONTGOMERY: Right now,
22 there's a hidden large capital cost on the boats
23 that our wardens are using that are going to wear
24 out.
25 CHAIRMAN ANGELO: We're not -- we're
.
48
1 probably not covering a lot of the costs, but that
2 being probably one of the most.
3 MS. WHITTENTON: Out of the -- only
4 about a hundred of the 470 game wardens actually
5 get advanced boater accident investigation
6 training. They all get some basic training when
7 they're in the cadet class, but we're not able to
8 provide the advanced training to very many of them
9 because it's given out of state.
10 Another big cost that's coming up is
11 that we're going to redesign our boat computer
12 system. It's now on a mainframe system, and we're
13 trying to move everything off our old mainframe
14 onto more client server based systems. We're
15 scheduled to start that in the spring, and get
16 that finished by the following year. That will
17 take a lot of programming time.
18 And also we've had, in the last
19 couple of years, some fuel increases for the boats
20 that the game wardens are using, although that may
21 level off now.
22 The game wardens are spending more
23 time on BWIs and they've had increased need for
24 equipment; these -- those PBTs is portable
25 breathalyzer tests, that they're buying.
.
49
1 They're also spending extra --
2 wardens are spending extra time on the -- on boat
3 dealer fraud investigations and on boat theft.
4 There's just been more of that activity.
5 And then boating equipment costs.
6 The average cost of a boat has increased quite a
7 bit. Over the last ten years, it's averaged --
8 it's increased about $3500 for an average boat.
9 COMMISSIONER FITZSIMONS: So what's
10 the dealer fraud? I didn't --
11 MS. WHITTENTON: Boat dealer fraud?
12 Maybe Dennis Johnson could --
13 COMMISSIONER MONTGOMERY: I didn't
14 want to get you off the subject --
15 MR. SANSOM: There's all kinds of --
16 go ahead, Dennis.
17 MR. JOHNSON: Dennis Johnson, chief
18 of marine enforcement. Dealer fraud and boat
19 theft has been increasing over the last few years
20 in a tremendous amount. We get a lot more
21 complaints than we used to get. And with more
22 boats out there and more people in the business,
23 we have a lot of people that will go into the
24 business and sell boats without going through the
25 registration process, to be able to transfer that
.
50
1 money without putting it in their name. So they
2 end up cheating the state out of the tax money
3 that's due and then the registration fees.
4 And then a lot of dealer activity
5 has been that they don't pay the penalties, they
6 don't register them within the due date. We get a
7 lot of complaints from the public. And those are
8 spending a lot more time than we used to do and
9 costs develop from that.
10 MS. WHITTENTON: Thanks, Dennis.
11 Kind of on a related subject, in
12 this review, we looked at the statutory authority
13 regarding boats. And in the last legislative
14 session, the Commission was granted the authority
15 to adopt rules if it -- it may adopt rules for
16 creation of a program or the continuing
17 identification and classification of participants
18 in this industry, and then set fees accordingly.
19 And that would help deal with the boater -- dealer
20 fraud.
21 CHAIRMAN ANGELO: Suzy, would you
22 elaborate on what support you've gotten for that
23 from --
24 MS. WHITTENTON: I'm sorry?
25 CHAIRMAN ANGELO: The support you
.
51
1 have -- that the Commission or the department has
2 for doing that from the constituents.
3 MS. WHITTENTON: We have met a
4 couple of times with some of the folks from the
5 boating trades groups. And what they would like
6 us to do is create a program that would require a
7 mandatory dealer registration so that all dealers
8 would have to register and they would be required
9 to certify that they are complying with the state
10 law.
11 And then our job, we would have to
12 identify all of these manufacturers, distributors,
13 and dealers and have that listing available to the
14 public if anybody wanted the list. And our game
15 wardens feel like that's something we probably
16 need to do anyway.
17 CHAIRMAN ANGELO: This would address
18 somewhat the fraud question that was just brought
19 up. Correct?
20 MS. WHITTENTON: Right, it would.
21 Yes, it would.
22 CHAIRMAN ANGELO: You know, my first
23 thought on it when I first -- my first reaction to
24 that was that this was maybe an attempt by the big
25 boys in the business to restrict the activity of
.
52
1 smaller dealers. But I think, after looking at
2 it, there's a lot of legitimacy to the suggestion
3 and that we do this, particularly because the
4 restrictions and the cost of it would not be
5 prohibitive to someone who was legitimately
6 wanting to be in the business, even in a small
7 way. But it would also provide the protection and
8 make the law enforcement a whole lot easier.
9 COMMISSIONER MONTGOMERY: Monitor
10 the fraud issues?
11 CHAIRMAN ANGELO: It looks to me
12 like it would.
13 COMMISSIONER MONTGOMERY: I was
14 asking a question on the entity. Do we receive
15 any percentage motor fuel tax for motor fuels sold
16 on lakes? And if so, how much? How does that
17 figure?
18 COMMISSIONER FITZSIMONS: Like for
19 marina?
20 MR. SANSOM: We get, by statute,
21 three quarters of the unclaimed motor boat fuels
22 tax. When you go to a gas pump, the pump doesn't
23 know whether you're putting it into a car or boat.
24 So under the law, you are eligible, if you are
25 filling a boat up with gas, to apply for a refund,
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1 but no one does that. So three quarters of it
2 goes to us and a quarter of it goes to the
3 permanent university fund.
4 CHAIRMAN IDSAL: What's the amount?
5 MS. WHITTENTON: It's pretty big.
6 MR. SANSOM: It's around $13
7 million.
8 MS. WHITTENTON: Right. It's not an
9 insignificant source of funds.
10 CHAIRMAN ANGELO: Significantly.
11 COMMISSIONER RAMOS: A lot of people
12 don't know about that.
13 COMMISSIONER AVILA: Do they
14 estimate it?
15 MS. WHITTENTON: Yes, they estimate
16 it. It's a line item appropriation comes in a
17 sum-certain amount.
18 MR. SANSOM: And interestingly,
19 since we're on the subject, it is an issue in
20 appropriations each session because we have to
21 struggle to get the increment; that is, to argue
22 for the growth.
23 MS. WHITTENTON: Dealer fees that we
24 talked about were as follows. A Class A marine
25 dealer would pay $500 every other year. That
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1 would be someone -- a dealer who deals in new and
2 used boats. Class B marine dealer would be
3 someone who deals only in used boats or motors.
4 It would be only $250 dollars every other year.
5 And then distributors and manufactures would be
6 charged $500 every other year per the program.
7 COMMISSIONER MONTGOMERY: What are
8 the current fees? Can you compare those to the
9 current?
10 MS. WHITTENTON: Currently, the only
11 fee that we have is one for dealers and
12 manufacturers of $130 every other year. But it's
13 not a required registration.
14 COMMISSIONER FITZSIMONS: It's just
15 what they --
16 CHAIRMAN ANGELO: This would be part
17 of the implementation on the previous item that
18 was discussed.
19 MS. WHITTENTON: This would be part
20 of the -- if the Commission decided to take on
21 this new program, it would be the fees associated
22 with that.
23 Other possible boat fee changes that
24 we looked at, these range from a $5 increment to a
25 $20 -- from a $5 increase to a $20 increase over a
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1 two-year period. Translated on an annual basis,
2 this would be a range of, you know, a $2.50
3 increase to a $10 increase. A $10 increase would
4 be for the large boats. The Class 3 boats are
5 those over 40 feet.
6 Also would recommend charging the
7 same fee for a livery vessel as for any other
8 boat, so that -- that wouldn't be a separate
9 category -- that wouldn't be a different fee. And
10 then changing -- we would recommend changing
11 titles and quick titles by about $10, and then
12 transfers and duplicates an additional $5 fee.
13 What would this do for Fund 9? We
14 estimate that if these fees were in place for an
15 entire year, an entire fiscal year, that the
16 revenue impact could be as much as four to four
17 and a half million. And, of course, if the
18 economy dips that, you know, may not hold true.
19 But if changes -- and if changes were made
20 midyear, it would be a prorated share of that
21 amount.
22 CHAIRMAN ANGELO: So potentially,
23 though, we're talking about increasing fees in an
24 area right now we're seeing a declining income
25 already from the fees we have?
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1 MS. WHITTENTON: Right.
2 CHAIRMAN ANGELO: So it's a little
3 more difficult.
4 COMMISSIONER MONTGOMERY: It makes
5 that study particularly important to understand
6 what's going on.
7 MS. WHITTENTON: And we did -- we
8 started reviewing these fees before we saw the --
9 CHAIRMAN ANGELO: Saw the decline.
10 MS. WHITTENTON: -- decline.
11 COMMISSIONER MONTGOMERY: But,
12 again, let's understand the source -- the cause of
13 the decline.
14 MS. WHITTENTON: Right. We will
15 look into that further and see what we can find
16 out. What we could do is go ahead and publish in
17 the Texas Register to collect some public comments
18 and get some input. And in the meantime, continue
19 to meet with constituent groups and the public.
20 And then bring you back something in January for
21 your consideration.
22 COMMISSIONER MONTGOMERY: I guess I'd
23 like to see that study well before this -- well,
24 we would see it at the same time.
25 CHAIRMAN IDSAL: Mr. Chairman, Suzy,
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57
1 if I understand it correctly, publishing in the
2 register does not commit us to --
3 MS. WHITTENTON: That's right.
4 CHAIRMAN IDSAL: Any action in terms
5 of fee increases. It just establishes that we
6 can.
7 CHAIRMAN ANGELO: It establishes
8 some amounts over -- above which we could not go.
9 We could go below those or do nothing.
10 MS. WHITTENTON: Right.
11 CHAIRMAN IDSAL: Right.
12 COMMISSIONER AVILA: Your boat
13 database will tell you who hasn't reregistered?
14 MS. WHITTENTON: Yes.
15 COMMISSIONER AVILA: And you could
16 just do a survey of those people, they check the
17 box and find out whether it's --
18 MS. WHITTENTON: Find out why
19 they're down. We could probably gather some
20 information pretty quickly on that.
21 COMMISSIONER FITZSIMONS: You could
22 see who is suspended and then comes back, I
23 presume?
24 COMMISSIONER AVILA: Well, it was 25
25 percent down. You know the 25 percent that did
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1 not reregister. And then you're going to find out
2 if they sold their boat or it got old enough where
3 they are not voting anymore or now it's the
4 economy and --
5 MS. WHITTENTON: Or just waited
6 until November to pay.
7 CHAIRMAN ANGELO: It may be that a
8 significant part of it is nonpurchase of new
9 boats, in which case that's a different problem.
10 COMMISSIONER FITZSIMONS: Well, do
11 you know the percentage of new boats sales out of
12 that?
13 MS. WHITTENTON: No, we don't.
14 COMMISSIONER FITZSIMONS: You
15 wouldn't know that?
16 CHAIRMAN ANGELO: But that's one of
17 the things you're going to look into. Right?
18 MS. WHITTENTON: Yes. That would be
19 something I could try to get.
20 COMMISSIONER FITZSIMONS: What about
21 registration database, you can't tell if it's a
22 new boat? Can you tell if it's a new boat?
23 MS. WHITTENTON: I don't know.
24 COMMISSIONER AVILA: That's the
25 other piece.
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59
1 MS. WHITTENTON: I would think you
2 could. I would think you could because it would
3 be a new number.
4 COMMISSIONER RAMOS: It would be a
5 new model.
6 COMMISSIONER FITZSIMONS: Model,
7 year.
8 MS. WHITTENTON: Yeah. We could
9 probably sort it by make and model -- by year --
10 model year. I believe there's somebody here from
11 the boating trades association if you wanted to
12 try to ask any questions about trends in sales.
13 They may have that.
14 CHAIRMAN ANGELO: Well, if this
15 revenue trend isn't reversed sharply, I think it's
16 going to be extremely important that that study
17 that Commissioner Montgomery suggested be done
18 thoroughly because we can't make this decision
19 regarding the fee increases without knowing that
20 sort of thing, among others.
21 COMMISSIONER AVILA: Well, and if
22 fishing licenses are up, you know, it isn't
23 necessarily the fishermen. It may be the
24 recreational boats --
25 MR. SANSOM: Jet skis.
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1 COMMISSIONER MONTGOMERY: And it's
2 with the economy.
3 MS. WHITTENTON: Right.
4 CHAIRMAN IDSAL: I guess it's
5 obvious that if you've got revenues down 25
6 percent over last year that -- talking about fee
7 increases, right now is -- could be better timing.
8 COMMISSIONER FITZSIMONS: As Phil
9 says, you've got to identify the source of the --
10 COMMISSIONER MONTGOMERY: Something
11 just doesn't make sense to me.
12 COMMISSIONER FITZSIMONS: Identify
13 the source of the drop-off, which will be a
14 combination of things.
15 CHAIRMAN IDSAL: Assuming that a lot
16 of it is due to an economic downturn, that I think
17 is reflected throughout the economy --
18 COMMISSIONER FITZSIMONS: Yeah, but
19 how much of it is new boat sales, how much of it
20 is failure to reregister? We just don't know.
21 MS. WHITTENTON: Yeah. And maybe
22 the September 11th situation may had something to
23 do with people waiting to send their registration
24 in. We can try to look at that.
25 CHAIRMAN IDSAL: When did you say
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61
1 you could get that to us?
2 MS. WHITTENTON: I would think
3 fairly quickly in the next couple of weeks.
4 COMMISSIONER MONTGOMERY: The total
5 number of boats shouldn't have changed that much.
6 Sales may be down, but we're doing it --
7 MS. WHITTENTON: Then again, we're
8 looking -- we're comparing September of this year
9 to September of last year, and October of this
10 year to October of last year. These are not big
11 months with heavy activity in boating anyway. So
12 these aren't -- you know, we're already starting
13 with small numbers.
14 COMMISSIONER FITZSIMONS: But as he
15 points out, though, your trend was year to year.
16 MS. WHITTENTON: Right.
17 CHAIRMAN ANGELO: We need the
18 answer. Are there any further questions on this
19 at this point? Would the -- I guess the
20 publishing would refer to the park and the voting
21 fees, so we do those at one time. Is that
22 correct? Or do we do them separately?
23 CHAIRMAN IDSAL: I think they're
24 separate.
25 CHAIRMAN ANGELO: They're really
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62
1 separate items.
2 CHAIRMAN IDSAL: They're definitely
3 separate.
4 CHAIRMAN ANGELO: Well, with no
5 further questions or discussion, without
6 objections, we'll authorize the staff to publish
7 this item in the Texas Register for the required
8 public comment period. And that's referring to
9 the item that Suzy has just presented. Thank you.
10 Walt?
11 MR. DABNEY: Good afternoon,
12 Commissioners. I'm Walt Dabney, state park
13 director. I'd like to introduce Mike Crevier
14 sitting behind me here. Mike is our revenue
15 manager for state parks and wears a bunch of hats,
16 including overseeing our whole fee program and
17 putting it together on an annual basis, putting
18 together the state park stores.
19 Those of you that have been to the
20 state parks, a lot of those beautiful stores, Mike
21 has actually helped set up or directed to set up
22 and then provides the oversight and guidance for
23 that. And he also runs our concession program,
24 and then a whole lot of other things as we need
25 them done. Mike is a hard-working fellow.
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63
1 And I asked him to sit here with me
2 in case you had some other technical questions
3 that we could answer for you.
4 I want to do an overview on the
5 state park fees and talk about the different kinds
6 of fees that we have. Certainly, entrance fee is
7 the most commonly known. And that's paying to get
8 into the park usually for a 24-hour period.
9 We have facility use fees, and
10 that's generally a fee paid for the use of one of
11 our facilities, like one of the CCC pavilions.
12 And while it's generally for an overnight use, it
13 might be for a wedding event or something like
14 that. And we have a fee schedule for those.
15 And then an activity or use fee, and
16 that's a fee paid for special programming that you
17 wouldn't normally think you paid for when you came
18 through the entrance station.
19 We have a good process in place, and
20 we have a fee range that you approve. It has gone
21 through the public process. You approve a range
22 of fees for everything that we do, the three
23 things that I just listed. They're park specific.
24 In fact, if you're interested, on
25 the Internet, there is a sheet for every single
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64
1 state park. And we have lots of fees. You can
2 pull that up on the Internet or look at this book.
3 But each park has one. And what we do within that
4 range of fees that you authorize is, we go to each
5 park and do an annual comparability study.
6 So if we're talking about camp sites
7 with sewer and water, we go to the local area,
8 Casa Blanca, what do they charge, what does KOA
9 charge and some of the others in the local area.
10 And we tailor our fees to be consistent with the
11 local environment. That's done on an annual
12 basis. It's a lot of work.
13 Our park managers direct that on a
14 local basis. And it reflects a -- it's a good
15 process, and it keeps us in tune with what the
16 market does on a local basis.
17 The fee ranges, again, in entrance
18 fees, it's a dollar to five dollars a person.
19 Actually, it's 50 cents for children on
20 educational tours. Facility use, we have 21
21 different types and 50 individual fees for such
22 things as camp sites, shelters, cabins, hotels,
23 like Indian Lodge or Balmorhea, group facilities
24 and so forth.
25 Activity fees, about 20 different
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65
1 types, 56 individual fees and those are everything
2 from a tour to swimming, golf, training
3 excursions. And you-all know we run a railroad in
4 this state park system. Commercial use and
5 filming. We film a lot of movies and commercials
6 in the state park system, And we have a fee
7 schedule based on what you want to do. Obviously,
8 special uses like weddings and so forth are all
9 part of this fee range.
10 The last time the fees were changed
11 in total in the range was in 1991. The actual
12 fees, the reason we need to change this is we're
13 up against the ceiling on a number of them right
14 now. We raised about $25 million a year in our
15 fee program from all sources. And our costs now
16 to operate these parks have gone up, especially
17 those costs related to such things as utilities
18 and fuel.
19 Obviously, a 4 percent pay raise
20 right now, which we are lapsing about 80, nearly
21 80 positions this year to try to cover in here is
22 another reason to try to get our fee revenues up.
23 Future growth. The new range established gives us
24 the ability to go with escalating costs over time
25 without coming back every year and asking you for
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66
1 a new fee range again. This one was done in '91.
2 We actually put the per price -- per person price
3 for entrance fees in place in 1996. Since then,
4 we haven't really had a change -- any change on
5 here.
6 The next step for us would be to
7 publish the proposed fee ranges in the Texas
8 Register, the same that we just talked about with
9 the boating fees, solicit public comment during
10 that period.
11 We will be conducting constituency
12 group meetings. In fact, Chairman, the first
13 meeting of the State Parks Advisory Board will
14 occur during this period, and we will be
15 presenting them a fee briefing and getting their
16 feedback from that group of folks that you just
17 appointed to that.
18 And then we will come back in the
19 January commission meeting and submit for your
20 approval the new fee ranges. I can't tell you
21 what those would actually generate, now, because
22 we don't -- we haven't gone back out and looked at
23 each location and come back in with a proposal of
24 what that would be within that fee range for a
25 Casa Blanca or a ^ Garner or whatever it is.
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67
1 But the next step after we get the
2 fee ranges would be to go back out after you've
3 approved that fee range, and come up with our
4 annual adjustment within that fee range for each
5 individual park and each individual fee.
6 And that concludes my presentation.
7 If you have any questions, I'd be glad to try to
8 answer that.
9 CHAIRMAN ANGELO: Are there any
10 questions, comments? No further questions or
11 discussion. Without objection, we would authorize
12 the staff to publish this item in the Texas
13 Register for the required public comment period.
14 No objection? So done.
15 Item number 6, there will be --
16 MS. WHITTENTON: I'm sorry.
17 CHAIRMAN ANGELO: Excuse me, Suzy.
18 Go ahead.
19 MS. WHITTENTON: We had one -- a
20 couple more slides just to tell you where we are
21 on other fees, just kind of as a wrap-up. On a
22 staff level, we pulled together a cross-divisional
23 committee to study fees. And so we're at the
24 process now of just collecting and analyzing data
25 and reviewing all types -- all different types of
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68
1 licenses and permits that we have.
2 And we're looking at the possibility
3 of developing some new products, as well as
4 looking at streamlining or simplifying the current
5 fees that we have. That process is underway right
6 now. We plan to gather input from advisory
7 committees and the general public and put together
8 a proposal and get some commission input in
9 January or April and go from there.
10 CHAIRMAN ANGELO: Very good. Thank
11 you. Item Number 6, it's been suggested that we
12 pull that from the agenda today. If there's no
13 objections, we'll do so, and that can be handled
14 procedurally at a later time.
15 If no other business, that concludes
16 the work of the Finance Committee for today. And
17 the meeting is -- or the Finance Committee meeting
18 is adjourned. Madame chairman?
19 CHAIRMAN IDSAL: We will now convene
20 the infrastructure committee meeting. Will you
21 pass that to John Avila.
22 *-*-*-*-*
23 (MEETING ADJOURNED.)
24 *-*-*-*-*
25
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69
1 REPORTER'S CERTIFICATE
2 STATE OF TEXAS )
3 COUNTY OF TRAVIS )
4 I, MELODY RENEE DeYOUNG, a Certified
5 Court Reporter in and for the State of Texas, do
6 hereby certify that the above and foregoing 50
7 pages constitute a full, true and correct
8 transcript of the minutes of the Texas Parks &
9 Wildlife Commission on NOVEMBER 7, 2001, in the
10 commission hearing room of the Texas Parks &
11 Wildlife Headquarters Complex, Austin, Travis
12 County, Texas.
13 I FURTHER CERTIFY that a stenographic
14 record was made by me at the time of the public
15 meeting and said stenographic notes were
16 thereafter reduced to computerized transcription
17 under my supervision and control.
18 WITNESS MY HAND this the 9th day of
19 January, 2002.
20
21
MELODY RENEE DeYOUNG, RPR, CSR NO. 3226
22 Expiration Date: 12-31-02
3101 Bee Caves Road
23 Centre II, Suite 220
Austin, Texas 78746
24 (512) 328-5557
25