Colorado Legislative Council Staff

STATE

REVISED FISCAL NOTE

(Replaces Fiscal Note dated April 3, 1998)

TABOR Refund Impact

No State General Fund Impact

Cash Fund Revenue and Expenditure Impact


Drafting Number:

Prime Sponsor(s):

LLS 98-887

Rep. Salaz

Sen. Dennis

Date:

Bill Status:

Fiscal Analyst:

April 22, 1998

House 2nd Reading

Will Meyer (866-4976)

 

TITLE:            CONCERNING A PROHIBITION ON THE TRANSFER OF A CUSTOMER’S ACCOUNT FROM ONE PROVIDER OF TELECOMMUNICATIONS SERVICES TO ANOTHER WITHOUT THE CUSTOMER’S PRIOR APPROVAL, AND, IN CONNECTION THEREWITH, APPLYING SUCH PROHIBITION TO PERSONS WHO PURCHASE AND RESELL TELECOMMUNICATIONS SERVICES.


Summary of Legislation


            The provisions of this bill, as amended in the House State Veterans and Military Affairs, Finance, and Appropriations Committees, would prohibit the practice of switching all or part of a telephone customer’s account from one carrier to another without giving clear and adequate notice to the customer or receiving the customer’s clearly expressed approval for the change. The bill also would require resellers of long distance service to register with the Public Utilities Commission (PUC) and would authorize the PUC to enforce the prohibition on “slamming” by exercising any of their existing powers of enforcement. The bill would become effective upon signature of the Governor.


STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

State Revenues

General Fund

Fixed Utilities Cash Fund



$51,768



$47,468

State Expenditures

General Fund

Fixed Utilities Cash Fund



42,891



38,591

FTE Position Change

1.0 FTE

1.0 FTE

Local Government Impact — None Identified.



State Revenues


            Fixed utilities assessments are made annually based on the appropriation to the PUC for work related to fixed utilities. The FY 1998/99 and FY 1999/2000 assessments would be increased to cover the increased costs of the PUC. Revenues to the Fixed Utilities Cash Fund would increase by $51,768 in FY 1998/99 and $47,468 in FY 1999/2000, an amount sufficient to cover the costs of the bill as well as those costs not included in this fiscal note pursuant to the Joint Budget Committee’s budget policies.



TABOR Refund Impact


            Section 20 of Article X of the Colorado Constitution, limits the maximum annual percentage increase in state fiscal year spending. Once total state revenue from all sources that are not specifically excluded from fiscal year spending exceeds these limits for the fiscal year, the state constitution requires that the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Based on the current Legislative Council economic forecast, it is projected that the state will be in a TABOR refund position during each of the next five fiscal years. Any increase or decrease in state revenue from changes in fees, fines, licenses, or other revenue sources will affect the amount of the state revenue to be refunded.



State Expenditures


            Background. The PUC has indicated that US WEST estimates that it receives 65,000 requests from Colorado customers per year asking that a charge from a long distance reseller be removed from their telephone bill. In most cases, a reseller would then bill the customer directly. The FCC reports that they received 716 requests from Colorado customers in 1996 to recalculate long distance charges based on the rates the customer would have been billed had a reseller not transferred their account without authorization.


            Under the provisions of this bill, the PUC would be responsible to resolve these complaints. Currently, the PUC’s Consumer Complaints Unit resolves 1,687 complaints per employee. While the number of requests the PUC will receive cannot be accurately determined, the number of requests are assumed to range from 716 (the number of requests currently filed with the FCC) and 65,000 (the number of requests currently received by US WEST). It is estimated that the PUC would require 1.0 FTE to answer future requests and to resolve the complex issues contained in the requests.


COSTS TO THE PUC TO IMPLEMENT HB 98-1405

 

FY 1998-99

FY 1999-2000

Personal Services: 1.0 FTE

$35,024

$35,024

Operating Expenses

3,567

3,567

Non-recurring Expenses

4,300

 

Total Expenses

$42,891

$38,591

             

            It is estimated that it would cost $42,891 in FY 1998/99 and $38,591 in FY 1999/2000 to implement the provisions of the bill.



Expenditures Not Included


            Pursuant to the Joint Budget Committee’s budget policies, the following expenditures totaling $8,877 in FY 1998/99 and FY 1999/2000 have not been included in this fiscal note:

 

               health and life insurance costs;

               short-term disability costs;

               inflationary cost factors;

               leased space; and

               indirect costs.



Spending Authority


            This fiscal note implies that the Department of Regulatory Agencies, Public Utilities Commission, would require an appropriation of $42,891 and 1.0 FTE out of the Fixed Utilities Cash Fund in FY 1998/99.



Departments Contacted


            Regulatory Agencies              Law