Aug. 27 – 28, 2003 Commission Meeting Agenda
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Texas Parks and Wildlife Commission
Finance Committee

August 27, 2003

Commission Hearing Room
Texas Parks & Wildlife Department Headquarters Complex
4200 Smith School Road
Austin, TX 78744

BE IT REMEMBERED, that heretofore on the 27th day of August, 2003, under the regulatory authority of the Parks and Wildlife Commission of Texas, in the Commission Hearing Room of the Texas Parks and Wildlife Department Headquarters Complex, to wit:

APPEARANCES:

THE TEXAS PARKS AND WILDLIFE COMMISSION:

FINANCE COMMITTEE:

THE TEXAS PARKS AND WILDLIFE DEPARTMENT:

Robert L. Cook, Executive Director, and other personnel of the Texas Parks and Wildlife Department

VICE-CHAIRMAN ANGELO: All right. The meeting is formally called to order. And before proceeding with any business, we have a statement from Mr. Cook, please.

MR. COOK: Mr. Chairman, a public notice of this meeting, containing all items on the proposed agenda, has been filed in the Office of Secretary of State, as required by Chapter 551 of Government Code, referred to as the Open Meetings Law. I would like for this action to be noted in the official record of this meeting.

VICE-CHAIRMAN ANGELO: Thank you, Mr. Cook. The first committee meeting this morning will be Finance. And our first item of business with that committee meeting is the approval of minutes from the previous meeting. Do I have a motion?

COMMISSIONER FITZSIMONS: So moved.

COMMISSIONER RAMOS: Second.

COMMISSIONER HOLMES: Second.

VICE-CHAIRMAN ANGELO: All in favor, please say aye.

(A chorus of ayes.)

VICE-CHAIRMAN ANGELO: Those are approved. Next, we have the Chairman's Charges, Mr. Cook.

MR. COOK: Mr. Chairman and Commissioners and guests, I am particularly pleased to report to you that our licensing system — our point-of-sale licensing system is functioning well. We are slightly ahead of where we were last year as far as sales and revenue both.

We had some initial start-up problem, particularly with the PC unit, as I reported to you folks earlier. We got those resolved after about the second or third day. We continued, you know, to catch a little glitch here or there, but the system is working well. MCI WorldCom folks have been very responsive in working with our staff, and of course, that's a huge occurrence for us each year. And this coming weekend — basically what we do, starting in mid- to early August of each year, is really just get tuned up and get ready for the huge volume of sales that will occur this Friday, Saturday, Sunday, and over the Labor Day weekend. So we believe we're going into that in good shape, and looking forward to it.

We have, total in the Hypercom installations and in the PC installations across the state, about 2,100 sites that licenses are available. We found some folks go in and out of that licensing system. We have some new requests each year, but right now we're sitting on about 2,100, and that seems to be adequate to handle the people who are looking for licenses.

Our staff — our licensing staff have+ successfully implemented all of the legislative and Commission-approved changes to the license system. These changes include both the new license types, such as the new fishing guide licenses, and the changes in license fees for the year.

From the start of license sales on August 15, compared to last year, sales are up 1 percent. Licenses sold were like 185,900 in '02, compared to 187,300 in '03, in the current year. Revenue is up 17 percent. So as I said, it's looking pretty well.

TPWD — we took over the fulfillment of licenses sold through the call center from MCI's subcontractor. Our turnaround time and customer satisfaction were a concern that we had, and our fulfillment center is current with the fulfillment of all licenses.

It is going very well. People are getting their licenses sooner, much more promptly. So we feel pretty good about that, and we believe it's going to end up being cheaper for us to do that.

We continue to work on our internet sales ability. And we expect to sell licenses over the internet sometime during this license year. The final phase of our work is proceeding with MCI. They have committed to completing all the required outstanding features to the system prior to the end of the calendar year.

Our freshwater stamp art work — I'll give you a little update on that. The — through the contract with Collector's Covey, Mr. Wood currently provides annual artwork for waterfowl, saltwater, turkey and non-game stamps. With the introduction of the freshwater stamp, we have the following two options: A) add the artwork for a freshwater stamp into the Collector's Covey artwork contract; or B) substitute the freshwater artwork in place of the non-game artwork that we have, and have our in-house artist produce the non-game artwork.

Collector's Covey prefers to add the freshwater artwork as an amendment to the contract, and keep the non-game artwork as well. And they are already working on this, having artists working on a freshwater stamp for the November Commission meeting. And I believe we are fine with that recommendation. And that's all I have to update you on as far as the charges.

VICE-CHAIRMAN ANGELO: Any questions or comments?

(No response.)

VICE-CHAIRMAN ANGELO: Thank you, Mr. Cook.

MR. COOK: Thank you, sir.

VICE-CHAIRMAN ANGELO: And we'll move on to our second item on the agenda, which is the Operating and Capital Budget, Investment Policy and Budget Policy. And Mary Fields will present this item. Mary?

MS. FIELDS: Good morning, Commissioners. For the record, I'm Mary Fields, Chief Financial Officer, and I'm here to present the proposed Fiscal Year 2004 Operating and Capital Budget for your consideration.

You will recall that we discussed the 2004 operating budget in detail last month during our budget workshop. Over the past month, we have worked with the divisions to finalize our amounts for this budget proposal.

Today I'd like to provide you with a quick recap of our budget process, discuss how our budget is financed, provide some different summaries of our budget, outline the grants that are currently planned, discuss our budgeted FTEs, and wrap it up with just a few key points regarding our budget.

In the interest of time I will keep this presentation brief, but please feel free to ask questions as we go along.

Let's start with the recap of the budget process. We used legislative appropriations as our starting point to incorporate legislative intent into the budget process. In an effort to be conservative, we are reserving 15 percent, or approximately $2.5 million of the appropriated fee increase until we are certain that we will receive the estimated revenues.

Most divisions started with roughly 95 percent of the budget that they received in Fiscal Year 2003, and they were asked to prioritize their programs from the ground up to determine what programs could be funded.

Through a supplemental process, divisions were given the opportunity to ask for more than the base amount of funding that they received. All base budget and supplemental decisions for funding were based on accomplishing our core responsibilities.

I'd like to provide some background on how our operating budget is financed. As I mentioned, we started the budget process with legislative appropriations, and we were authorized $253.9 million for Fiscal Year 2004. There were some limitations on our funds, and I've detailed some of the limits on our capital budget that we actually reviewed previously.

I'll just highlight again that we received 60 percent less for vehicles this year; however, and on the positive side, we received 180 percent more for land acquisitions. And this was primarily due to federal funds being added to this particular line item.

We also received two additional FTEs that were designated for aquatic vegetation control, which puts our FTE cap at 3,037.5. We'll discuss FTEs in a little more detail within the presentation.

Through the appropriations process, we received some reductions and a couple of additions. We did not receive any new Prop. 8 bonds, and this resulted in a $34.2 million reduction over the biennium. Local Park Grants were reduced by $7.7 million for Fiscal Year 2004.

Minor Repairs and Outreach and Public Awareness funds were both reduced by about $1.5 million. And finally, Information Resources funding was reduced by $900,000.

On the positive side, we did receive the fee increase rider that will bring in an estimated $15.8 million this year. And these funds have prevented us from having to make further budget reductions.

We also received an additional $299,000 of appropriations for the regulation of marine dealers, and you'll hear more about these regulations in another presentation to the Finance Committee today.

As we go through the process of financing our budget, we do identify additional funds that we will receive beyond what was included in the Appropriations Act. This year we identified $35.2 million of additional funds. They are highlighted there under the Adjustment Section.

That brings our budget up to $289.1 million. We reviewed this crosswalk last month as well. Most of these amounts are fairly close to what was presented last month, with the exception of federal funds. That amount did go down, which we had told you we anticipated that it would.

I do want to mention, though, as the year progresses, we will add more federal dollars to the budget as we receive the grant awards.

This next slide just summarizes our different funding sources of the budget. If you look at the pie chart, a little over half of our dollars come from General Revenue Dedicated Accounts, and the remaining half is basically straight General Revenue, federal and other funds. Those other funds are bonds and appropriated receipts, basically.

Let's move on to our operating summaries. I've got about three ways I've summarized this for you. We'll start with the summary by strategy. Again, this is the format that is typically used when we discuss our budget with legislators and oversight agencies. Most of these budgeted strategies track very closely with the General Appropriations Act.

Most of them are roughly about five percent above the bill, and that's because of that — those additional funds that we just talked about that we added. There are a couple of exceptions I'd like to mention.

Manage Fish and Wildlife and the Public Hunting and Fishing Strategies are about 10 percent — there is about a 10 percent difference to the bill. One is over and one is under, so they offset each other. And this basically occurs because of how the federal funds were applied to these strategies.

Law Enforcement also is down by about six percent from the bill. And this also has to do with federal funding. We received less from the National Oceanic and Atmospheric Association, or NOAA, than we anticipated when we prepared our Legislative Appropriations Request.

The next couple of slides present our budget by division. Within your handouts you will see a page that lays out our budget by division, and it also shows the different categories of expense that are budgeted within each division.

As mentioned last month, Department-wide is quite a bit larger this year, because we've included Bonded Debt Service, our Statewide Indirect Cost Allocation and State Office of Risk Management assessments to that category. Information Technology has also been broken out as a separate division this time.

On the second slide, this is the remainder of the divisions I will point out that we have $47.4 million of unexpended balances that have been carried forward for our construction and capital projects.

The final summary shows our budget by object of expense. I've included some comparison numbers to our current FY-03 budget. As expected, most of the categories are less than in 2003. There is one exception, and that is in Operating and Equipment.

The increases that I just discussed for Department-wide, the Bonded Debt Service, the risk management assessments, and the Statewide Indirect Costs, have been appropriately included in the budget, and they're in Operating and Equipment. And that's why that number is higher than it was in Fiscal Year '03.

And as far as the grants that we're going to pass through this year, again, they are a little bit less than Fiscal Year 2003, as you would anticipate. Most of these grants are the same types that we have passed through in years past.

There is one exception, and — or one new one, rather. That is the Shrimp Disaster Relief Grants that we've received from the federal government that amount to $5.4 million.

And I will just mention that while the $26.3 million is much less than Fiscal Year 2003, we do anticipate again receiving additional grant funds, and they'll be added to the budget as the year progresses.

To recap our FTEs, again, a comparison to Fiscal Year 2003 — you'll recall from last month's discussion that we eliminated 102.7 positions. So if you look at the 3,145 to our '04 requested amount, that difference is the 102.7.

Right now we're actually at 3,058 positions. That's kind of the current estimate of where we stand. You can see that our '04 request is about 16 positions less. That really has to do with some of the seasonal employees that we have on board right now, and also some of the retirements that we'll see at the end of this — at the close of this fiscal year.

I will just reiterate that although our requested amount is above the cap, we will not exceed the cap, because we won't have all of these positions filled at any one time.

Just to highlight a few key points in closing this budget discussion, our operating and capital budget is $49 million or 15 point — or excuse me, 14.5 percent less than Fiscal Year 2003. The largest appropriation reductions that I mentioned earlier will impact state park improvements and repairs, our local park grants, and outreach and public awareness programs.

I've mentioned that we'll have fewer positions and resources, but we still anticipate getting the priority work done. There are some positives to this budget cycle. State parks will be able to fill 66 of 90 positions, but the — that have been held vacant over the past three years.

And I might already have mentioned the fee increase, which just, you know, again prevented us from having to make further reductions. That concludes my presentation on the Fiscal Year 2004 Operating and Capital Budget. Are there any questions?

VICE-CHAIRMAN ANGELO: Do you have any comments, questions?

(No response.)

VICE-CHAIRMAN ANGELO: I want to just say that I think we all really appreciated the budget workshop and the commitment that the Commissioners made to familiarize themselves with what you all have done. And I want to say that I think what I said at that meeting is appropriate to be repeated.

And that is that I can't say enough about how much I appreciate the job that Director Cook and the staff have done in coming up with this budget, and making the cuts that were necessary, and doing the things that you all have done to efficiently bring us to this point. I know it wasn't easy, and not only have you done a great job at it, I think the attitude that's been pervasive through the department during this period has been extraordinary. And I want to thank all of you for that on behalf of the Commission. I felt strongly about that.

MS. FIELDS: Thank you.

VICE-CHAIRMAN ANGELO: Any — are there any other comments or questions?

(No response.)

VICE-CHAIRMAN ANGELO: Well, if there is no further objection, we'll place this item on the agenda for tomorrow for further action.

MS. FIELDS: I would like to then go ahead and move on to our next segment.

VICE-CHAIRMAN ANGELO: Okay.

MS. FIELDS: Annually we are required to review the Investment and Budget Policies. A copy of these policies are also included in your handouts. I'll touch on just a few key points of the Investment Policy. This policy is required by statute, and must be reviewed annually by the governing body.

All funds administered by Texas Parks and Wildlife are required to be deposited in the State Treasury, except for the four funds that I've highlighted here on this slide. While not required, all of these funds reside in the State Treasury except for the Operation Game Thief Fund. Those funds are actually invested in CDs.

All bank accounts must be authorized by delegated investment officers and must be properly collateralized, and specific reporting requirements are also included in this policy.

This year we have updated the policy to reflect certain requirements from the public investment — Public Funds Investment Act, and statutory references have been updated.

Moving on to the budget policy, the Commission authorizes the executive director to approve and execute necessary expenditures, budget adjustments and transfers. Several different types of transactions are detailed in the budget policy that's in your handout.

Budget adjustments that exceed a certain dollar amount require designated Commission approval, and I'd like to talk about that because that's where I would propose some recommended changes.

Budget adjustments that exceed $250,000 require prior approval from the Chairman and the Chair of the Finance Committee. That's what we're recommending. This threshold has been increased from $150,000. We also recommend eliminating the notification requirement for budget adjustments that exceed $100,000. Instead, I will just brief the Commission of the budget adjustments during our scheduled Commission meetings.

And this concludes my presentation on the policies. Are there any questions on these?

VICE-CHAIRMAN ANGELO: Questions or comments?

(No response.)

VICE-CHAIRMAN ANGELO: If not, Mary, if you'd go ahead and take the last item, and then we'll make the — agenda for tomorrow after that. I'll put them — we'll put them on at the end.

MS. FIELDS: Okay. Thank you.

VICE-CHAIRMAN ANGELO: Just go ahead. Is that everything?

MS. FIELDS: Yes, sir.

VICE-CHAIRMAN ANGELO: I thought you had one other. Okay.

MS. FIELDS: I'm sorry. Yes. That's all I had.

VICE-CHAIRMAN ANGELO: Okay. Well, in that case, if there is no further discussion or objections, we'll place these items also on the agenda for tomorrow's meeting.

And then we'll move on to Item Number 3 on the agenda, Implementation of HB 2926, the Marine Dealers bill. Dennis and Frances will present this item.

MS. STILES: Good morning, my name is Frances Stiles. I'm the Manager of the Boat Titling and Registration Section under the Administrative Resources Division. And this is —

MR. JOHNSTON: Dennis Johnston, Chief of Marine Enforcement. House Bill 2926, passed by the 78th Legislature, changed the present systems of licensing marine dealers from a voluntary license to a mandatory license requirement, effective March 1, 2004.

This legislation applies to any person engaged in the business of selling five vessels, motorboats or outboard motors in a calendar year, and includes dealers, manufacturers and distributors.

The legislation provides law enforcement inspection authority and penalties for refusal to allow inspection of these dealerships. The fee for a dealer license was raised from $130 to $500. The Commission was also given rule-making authority to implement the program. Proposed 53.200 adds the definition of a consignment as a sale or offer to sell by a person other than the owner, under terms of a verbal or written agreement.

Proposed 53.201 provides rules to implement the marine dealer program application requirements for a dealer, manufacturers and distributors, and includes the requirement to provide attachments with the application, including photographs depicting the business facility, copies of tax permit issued by the Comptroller's Office, verification of all assumed names, where applicable, and a photocopy of current identification.

Proposed 53.202 requires a license holder to notify the department in writing, within ten days, if there are any changes in ownership, business name, physical location, dealer agreements, distributors, dealers, or representatives' address or phone information.

Proposed 53.203 requires dealers to publicly display the license in the place of business. Proposed 53.204 requires a marine dealer license holder to keep a complete record of transactions available for inspection at all times in the place of business, and retain records for a minimum of 24 months.

House Bill 2926 also provided mandatory registration of U.S. Coast Guard-documented vessels, and provided authority to the Commission to allow an exception to the placement of the registration decal on antique vessels.

Proposed 53.205 requires the documented vessel to place the registration sticker on both sides of the bow. Documented vessels used in coastal shipping and vessels under 115 feet in length are exempted from registration.

Proposed rules also require vessels registered as antique to attach the registration validation sticker to the left portion of the windshield. In the absence of a windshield, the validation sticker must be attached to the certificate of number and made available for inspection when the vessel is operated on public water.

MS. STILES: The third category of this legislation establishes that the Commission may, by rule, charge a fee for access to ownership records and other records made or kept under the Water Safety Act.

The rule establishes two reports for ownership records at $2 and $10, and two reports for accident reports. This mirrors practices by local cities, counties, as well as the Department of Public Safety.

And the last category from the legislation is that the Agency was allowed the authority to establish bonded titles. The rule provides the establishment of a new bonded title fee of $35. This is a titling situation that is backed by a security bond. It's a vessel that must not be stolen, and that the situation would not defraud the owner or the lienholder.

It's brought about by a lack of — or a break of ownership documentation trail, and the customer has no ability to obtain the needed documentation. This would cover situations where there is a lack of title, or a title assignment, a lack or problem with the bill-of-sale or invoice, and a lack of authorization to handle the disposition of the estates.

We do have one clarification in the rule that we noted under Fees, of 53.10, Item 2, Fiscal Note, Item 4, U.S. Coast Guard. The fiscal impact needs to be changed from $442,000 to $42,000. And that was picked up when this was published, and an error correction has already been sent. We did receive one public comment.

MR. JOHNSTON: Comments on proposed rules published in the Texas Register received from the Boating Trades Association of Texas and the Boating Trades Association of the Greater Houston Metropolitan Area.

These comments included requested clarification in the rule language between dealer and distributor/manufacturer requirements. And they also requested an increase in the retention of dealer records to 36 months.

The proposed language was amended to facilitate the ease of understanding for the affected dealers in nonsubstantive changes. The increase in retention period for records was not changed, because it was a substantial change in what was published in the Register.

Both trade associations have submitted a letter — in fact, all of the trade associations in Texas have submitted a letter that I got this morning in full support of the proposals as amended. I'd be happy to answer any questions that you have.

VICE-CHAIRMAN ANGELO: Any questions or comments?

(No response.)

VICE-CHAIRMAN ANGELO: There being none, we'll place this item on the agenda for tomorrow, for public comment and action. Thank you both. We'll go on to Item Number 4, which is the License Fee Adjustments.

MS. HORSLEY: Good morning, Commissioners. My name is Julie Horsley. I'm a Program Specialist in the Budget and Planning Section of the Administrative Resources Division, and I'm here this morning to discuss proposed rule-making related to the various license fees and other items in Chapter 53 of the Administrative Code and Finance.

The first of the proposed changes that I would like to discuss deals with the resident and nonresident fishing guide licenses. This change is necessary in order to implement provisions of Senate Bill 608, which was passed during the last legislative session.

As you may recall, Senate Bill 608 created separate categories of resident and nonresident licenses for the fishing guide. And what this proposed rule-making would do would be to create the nonresident category for fishing guide licenses in our rules.

Initially, the fee for the nonresident fishing guide would be the same as what we currently have in place which is $200 for saltwater, and $125 for freshwater. However, effective September 1, 2004, the fee for the nonresident saltwater fishing guide license would increase from $200 to $1,000.

The next item in the proposal is the Commercial Shrimp License surcharge. And this is mandated by House Bill 2470 and 1858, also of the last legislative session. And just a quick recap of these bills, they establish the new Shrimp Marketing Assistance Program within the Department of Agriculture, and require that the Parks and Wildlife Commission increase certain commercial and business license fees by 10 percent in order to fund that program.

So this proposal would implement that required 10 percent surcharge, and it affects resident and nonresident commercial Gulf and Bay shrimp boat licenses, as well as retail and wholesale fish dealers and fish dealers truck licenses.

One thing that's important to point out about this provision and this particular item, is that while Parks and Wildlife Department is responsible for assessing the surcharge and collecting the revenues, we wouldn't be able to — we wouldn't be keeping any of that revenue. It would be transferred to the Department of Agriculture.

The next item is the Lake Texoma Fishing License, and this change stems from recent action taken by the State of Oklahoma. The legislature there recently approved a fee increase to this license, contingent on the State of Texas adopting a similar increase.

So this proposal would increase the current fee for the Lake Texoma license from $7.50 to $12, effective January 1, 2004. The estimated revenue from this increase is about $111,700, and 70 percent of that would go to Oklahoma, according to current statutory provisions.

The final fee changes that I wanted to discuss deal with the Conservation Passport, and with individuals designated as honorary citizens by the Governor. The Conservation Passport is an annual pass that allows the holder entrance into state parks.

The proposal is to discontinue this passport within Chapter 53 as of December 31, 2003. And it would be replaced with the State Park's Annual Pass that would be in Chapter 59, State Parks.

And this State Parks Annual Pass is an item that's going to be discussed in a separate rule-making that will be presented to you later today.

In terms of the final issue, dealing with honorary citizens, this has to do with the eligibility of certain nonresidents to purchase a lifetime license. Currently, only residents are eligible to purchase the lifetime hunting/fishing or combination licenses. However, the Commission does have the authority, via regulation or rule-making, to designate certain categories of individuals as residents. And what this proposal would do would be to allow a person that's designated as an honorary citizen to be considered a resident for the purpose of purchasing a lifetime license.

The proposals that I just discussed with you were published for comment in the July 25 issue of the Texas Register. We received two comments. Both have been against the proposal. So that concludes my presentation. And if you have any questions, I'd be happy to answer them.

VICE-CHAIRMAN ANGELO: Which part of the proposal were they against?

MS. HORSLEY: Both of them were against the proposal dealing with honorary citizen definition.

VICE-CHAIRMAN ANGELO: Did they say why?

MS. HORSLEY: They felt that it was inequitable and unfair, in terms of Texas residents footing the bill for nonresidents.

VICE-CHAIRMAN ANGELO: But it could probably be pointed out that this was not an initiative originated by the Governor. It really came from Parks and Wildlife. And in fact, I may have been responsible for the initial effort on it.

There was one particular gentleman that comes to Texas to hunt who is a big supporter of Texas Parks and Wildlife, and hunting and fishing in general. And that was the impetus of it. And I don't know that it'll ever have a major impact, but it didn't seem inappropriate to me at the time.

MR. COOK: I think the significance of it is that he will pay full price for the license. There won't be any subsidy.

COMMISSIONER RAMOS: Yes, to the extent that there is a misunderstanding, he will pay a full price like every other person. All it would do is qualify that person to have a lifetime license in Texas and still be a nonresident.

VICE-CHAIRMAN ANGELO: And they would not have to pay a nonresident license every time he came in. The cost of the license might even be more than he would have paid over time anyway. So — the particular individual anyway.

COMMISSIONER FITZSIMONS: More people would even qualify to pay $1,000 license. That ought to be a good deal.

VICE-CHAIRMAN ANGELO: Any other questions or comments?

(No response.)

VICE-CHAIRMAN ANGELO: If not, we'll place this item — excuse me, Phil —

COMMISSIONER MONTGOMERY: On the out-of-state guide fee, is that a legislatively mandated amount, $1,000?

MS. HORSLEY: The — for the saltwater?

VICE-CHAIRMAN ANGELO: To go to the $1,000.

MS. HORSLEY: We'd have the — the Commission has the authority to set it, and the $1,000 was selected, I believe, because Louisiana charges the same rate for us, for Texas residents to fish there.

COMMISSIONER MONTGOMERY: Do we want that high a number? It seems awful high to me. I don't know if there's been much discussion or much thought behind it.

VICE-CHAIRMAN ANGELO: I think it was entirely because of what Louisiana did, that that was recommended.

COMMISSIONER MONTGOMERY: We're bigger than they are. Shouldn't we do what we want to do?

VICE-CHAIRMAN ANGELO: Maybe we'll make it $2,000.

COMMISSIONER MONTGOMERY: Just because they do it, is that a good reason to do it? It seems punitive to me. I mean, we're going to scare off out-of-state-guides, I would think, at that price. Maybe we want to do that. But is that really what we want to do?

VICE-CHAIRMAN ANGELO: I don't guess that's all whether you're from Texas.

COMMISSIONER MONTGOMERY: I don't know whether the Texas guides want it or not —

COMMISSIONER WATSON: Well, I don't know. But it seems like to me — you know, one of the things that we certainly have a surplus of is guides. And I think if you'd go down to the coast on a weekend, you know, one of the problems we have are these part-time guides competing with the full-time guides.

And this would — I don't think we ought to encourage guides from Louisiana to come over and compete with our local guys, in addition to them — not — you know, if Louisiana charges $1,000, I think we ought to charge at least $1,000.

VICE-CHAIRMAN ANGELO: I don't have any trouble with that.

COMMISSIONER RAMOS: On the Lake Texoma issue, I notice that 70 percent of those increased revenues would be remitted back to Oklahoma.

MS. HORSLEY: Yes.

COMMISSIONER RAMOS: Is that a statutory mandate, or what's the rationale behind that?

MS. HORSLEY: Yes, there — it is in statute. Seventy percent goes to Oklahoma. And I believe that actually 30 percent of what they collect comes to us.

COMMISSIONER RAMOS: Okay. So we get money from the State of Oklahoma also?

MS. HORSLEY: Yes.

COMMISSIONER RAMOS: Okay.

MR. COOK: It has to do with the amount of water — the boundary line and the amount of water.

VICE-CHAIRMAN ANGELO: Any other questions or comment? There being no further discussion, this item will be placed on the agenda for public comment and action on tomorrow's agenda. Thank you, Julie.

Item Number 5, Park Fee Range Adjustments. Walt Dabney. Walt?

MR. DABNEY: Chairman, Commissioners, Good morning. I'm Walt Dabney, State Park Director, and I'm here to talk to you about state park fee range proposal. The Commission, in 1991, established our authority to establish differential pricing in the parks.

What that means is that we have an upper and lower range of fees for each thing we provide in a park, whether that's a campground, a cabin, or whatever. It also allows that fees might vary for the same kinds of basic services from park to park, and I'll explain that a little bit later on.

And it also means that fees might, in the same park for basically the same kind of facility, vary. For example, if you're camping in Garner, and you want a campsite immediately on the river, you're going to pay a little more for that than if you're way back in the woods, and people are very willing to do that.

The state park differential pricing methodology — we have a basic fee range. That fee range was last established in 1992, so it's been in place for a very long time. Some of the current fees have reached the upper end of that range, and we cannot raise our fees to recover our costs in that without you taking an action.

During that last eleven or 12 years, some of our costs have gone up, everything from utility costs to personnel costs and other things. We've also added some new programs and amenities, interpretive programs and that kind of thing, that enhances the visitor's opportunity to enjoy their experience there.

The way that our process works is that the Commission establishes a range of fees, again, for each type of service or facility offered. The parks, on an annual basis and park by park, go through and compare everything from a campsite to a cabin fee to the local economy, so that we in establishing our fees for similar kinds of services, are not undercutting local people or not overcharging for what we offer.

And that is submitted back in here, and a proposal is put together each year, and in some cases, prices actually go down, and others, they generally go up to meet our increased costs.

The executive director has the ability to approve those fees as long as they're within the range that you have approved. And those go into effect in January of each year.

We need — we've needed to undertake the exercise that is in front of you now because we've needed to clarify some of our fee language in Chapter 59. We've needed to, as Julie mentioned before, we need to clarify the language on the State Park Annual Pass, which will truly be a State Park Annual Pass, and we'll be coming to you in January to show you what that looks like.

It's a pretty exciting proposal. We think it will also increase our revenues in the state parks. We sell about 49,000 annual passes now. It's called a Texas Conservation Passport, which, generally speaking, doesn't mean anything to anybody out there.

And we're going to do something really novel and establish something that's called a State Park Pass, which people readily understand what that means. But it's going to be a neat deal, and it's going to be a card instead of a window sticker, and I think will make a difference.

We've changed some of our facilities. And those type of facilities are currently not addressed in our fee ranges. For example, at Inks Lake, we went through the old cabins that were 30, 35, 40 years old there, that are screened cabins, or their — they were neat things. We had to tear them down. We converted them to a limited-use cabin, and we made them more year-round.

We put heating and air-conditioning in there. And if you don't have your reservation by April now, you're probably not going to get one for the next season, they're that popular. It's extended the ability of people to stay into the hot and cold times of the year.

Another example of why we need to increase the fee range is Landmark Inn. And I know a number of you have been to Landmark Inn. It is an absolutely wonderful experience. Our room rates there are pegged against our range at $55.

We've had people come to finally stay with us that said, we didn't come here for a long time because we figured it wasn't very good. At $55, it couldn't be much of an experience or a facility. And it is. And we need to raise those fees, not hugely, but to recover our costs.

The fee increase, historically, has resulted in somewhere between half a million and $700,000 a year that comes back in to help operate the parks. Of course, much of that increase is offset by increased utilities and other fees.

Those fees would become effective in January, and run through December of each year. And we anticipate that if you approve this fee range as it was this last time, good for ten to 12 years, I'm sure the next one will be — will carry us through another eight or ten years. But it gives us the ability to adjust those fees annually without coming back to you.

We had one comment, and we have clarified that comment. The person was against it, but they thought that as soon as you passed the fee ranges they would all go into effect at the maximum end of the range.

We clarified back to them that was not the case. They also thought that the annual pass — you'd have to buy one for each park. And we explained to them that no, what we're trying to do is simplify it. And when you buy that State Park Annual Pass, it's good for the system. It will let you go as often as you want to, and I think we've clarified that.

So our recommendation is that we adopt the rules in the Administrative Code, as outlined in your book. And I will be open to any questions.

VICE-CHAIRMAN ANGELO: Commissioner Henry?

COMMISSIONER HENRY: Walt, last year there was a considerable amount of discussion of — concerning the state parks and the amounts as they related to — amounts we were charging as they related to people using or not using the parks, that would decrease in certain park areas in attendance and all.

I'm assuming that this has been taken into consideration, and you guys are adjusting — will be adjusting fees accordingly? And how will range from — I'm assuming in different areas in the state, adjustments will be different, just as they do within the park — from park to park?

You remember the discussion that —

MR. DABNEY: Yes, sir. I do. We think — one of the biggest criticisms I've heard since I've been here was from people who felt like every time they went through a park they were just getting nickeled and dimed, and we were stacking fees on every way we possibly could.

Our efforts in clarifying this is to minimize that. We're trying to make a wonderful State Park Annual Pass package. And we're trying to convince folks if you buy that package, say, at $60, you can go to any park you want, or as many parks as you want, 365 days of the year with everybody in your car getting in on that pass.

If you choose — if you don't do that and you choose to pay the per-person rate, which varies from $2 to $5 right now, that's bad business thinking. I mean, you should buy that pass. I mean, when your family of four or five goes to the movie and buys popcorn, they've bought an annual pass, one time. And this is one of the best deals going.

We think if you buy the annual pass, you can go day use all you want for the rest of the year with your whole family, whoever is in the car. Our camping fees and all those other fees are absolutely not extravagant, and again, they're indexed.

If you go to Garner, your campsite, for water and electric, is going to be more expensive than it is at Lake Casablanca down in Laredo. And that's because while the facilities are basically the same, the cost in the Laredo area is less expensive for those campsites than it would be in the area around Garner. So we index it to the local economy, and it works really well.

We think it's a much fairer way we're approaching this thing now. It's simpler. People are going to understand it better. And we're going to get the word out to them better than we have in a long time. And that's our plan.

COMMISSIONER HENRY: The other side of that is that there is — as long as I've been around, there has been discussion and the general belief that hunting and fishing basically supports the state park system. What are we doing, if anything, to dispel that belief, and — if in fact, it's true? And how are you guys approaching that issue?

MR. DABNEY: Well, it isn't true, because I can't use any of the monies that come out of Fund 9 to support state parks. And we can't use the money coming into state parks to fund the other divisions.

I will tell you that I think that I could make the case that the state park system and the central reservation office are doing a whole lot to support hunting and fishing in this, because number one, we hunt in 43 parks, which is a good deal. And our people are literally hauling folks out to the field and putting them in blinds and running the hunts on those parks.

We sell — and I can find out for you, in many of our state parks, hunting and fishing licenses right there at the desk. And the only thing the park gets out of that is the 75 cent fee for selling that license, but it's a benefit to our sister divisions here. And the Central Reservation Office is selling over the phones now license — the hunting and fishing license. And that money all goes into Fund 9.

So we can't mix the monies. We don't mix the monies. And I think it's pretty squeaky clean now. And I think we could prove that as an agency, that it is.

VICE-CHAIRMAN ANGELO: Commissioner Holmes.

COMMISSIONER HOLMES: Walt, you said that you were going to index the pricing based on local economy. By that do you mean the actual wage rates in the local economy, or are you talking about demand pricing index?

MR. DABNEY: Yes, it's really demand pricing. I could show you, Commissioner. We've got a couple of big notebooks that has every park in it with every fee we do. And we literally go out — for example, if you're talking about camping fees, we'll go to the other camping providers in the area and see what they are offering for that fee. And our park staff do that, and set our fees accordingly.

We do not want to undercut local entrepreneurs. And we don't want to gouge people, because we do provide, in most cases, more things than you would get if you'd go to a standard commercial campground. We've got trails. We've got acreage. You can do wildlife watching and all kinds of things. There you have interpretive programs.

But we still don't want to overprice and gouge folks. So we want it comparable to what people are paying in the local economy. It's not indexed to what the average income is to that economy, but —

COMMISSIONER HOLMES: Pricing in the area.

MR. DABNEY: Yes, sir. Yes, sir.

MR. COOK: The last couple of years, Walt and his staff have done a great job in this review. Very thorough, and my compliments to them.

They — you know, we occasionally get that call or that letter that you'll see from someone saying these guys are undercutting me. I can't rent a place because of —

And we will go to them and, you know, work with them, adjust accordingly, if needed. And — but you know, I think I want to comment on Commissioner Henry's statement. You know, across the board, these — within the organizations, we all deliver that message about parks and about what's available there. Walt, as he said, we very specifically sell hunting and fishing licenses.

We conduct hunts now on 40-some-odd different state parks so there is a lot of linkage there. But we have to be, by law — state law and federal law, very, very conscious of — very carefully documenting and auditing where those dollars go. And we do that. And it is very clean.

VICE-CHAIRMAN ANGELO: Commissioner Fitzsimons.

COMMISSIONER FITZSIMONS: A question for Walt. You mentioned Central Reservation System, which is — you've made a lot of improvements to, and I get a lot of compliments. Will they be selling the State Park Passes there?

MR. DABNEY: Yes, sir. It will.

COMMISSIONER FITZSIMONS: And you're too modest to mention this, but what you're doing with the mark-to-market, so to speak, on the lodging and the campground fees is in response — Walt was addressing the matters that were raised by the Comptroller —

MR. DABNEY: That is correct.

COMMISSIONER FITZSIMONS: — in their report on Indian Lodge and —

MR. DABNEY: That is correct.

COMMISSIONER FITZSIMONS: — I commend you for getting that done.

MR. DABNEY: It looks good out there now.

MR. COOK: Well, keep in mind, too, we spent — in our bond programs, we've spent now in the neighborhood of $60-, $70-, $80 million in repairs and renovations and updates. And so the facilities, compared to what they were ten years ago, are very nice.

And as Walt mentioned, in some cases, made a complete conversion from a screened-in shelter to a year-round facility. And those prices need to be adjusted. It doesn't —

VICE-CHAIRMAN ANGELO: Commissioner Ramos?

COMMISSIONER RAMOS: Bob, and then Walter, both of you, in view of what you're saying, Walt, that in fact, our park systems are spending money in an effort — not monies, but rather receiving revenues for hunting activities. Have you all looked at the possibility of allocating funds? I mean —

MR. COOK: Yes. That's done.

COMMISSIONER RAMOS: That is possible?

MR. COOK: Yes.

COMMISSIONER RAMOS: And that is being done? Okay. That it's being looked into, I guess? Before we put license fees —

MR. DABNEY: Hunting license fees don't come to state parks at all.

COMMISSIONER RAMOS: No, I understand that.

MR. DABNEY: We run a separate hunt, and you pay $40 to hunt at South Llano River. The park will get that fee —

COMMISSIONER RAMOS: Right.

MR. DABNEY: — or that hunt to stay in that park and offset the cost of operating — to stay in park funds.

COMMISSIONER RAMOS: Well, to the extent that our park employees are spending time in hunts, what I'm saying is are we somehow reimbursing, as you might say, the park system for hunting activities that are using park employee time?

MR. COOK: No, other than the $40 that the public hunter pays into the public hunt system and his application fees.

VICE-CHAIRMAN ANGELO: That ought to be sufficient.

MR. COOK: It goes to the park.

COMMISSIONER RAMOS: Okay. And to the extent

that we would spend monies, for example, for blinds or other capital improvements on the parks for hunting activities, is that still something that is absorbed by the park?

MR. DABNEY: It was, but that's been changed. I mean, the Fund 9 Wildlife Division has just replaced a number of the blinds, for example, down at Matagorda Island, and agreed that that's a legitimate cost to be paid out of hunting — out of those monies.

COMMISSIONER RAMOS: Because I certainly would be in favor of anything to try to maximize the revenues that we leave in the park system, because we obviously have some shortfalls in that arena. And to the extent that we could use hunting revenues for hunting-related activities on state parks, there ought to be an allocation with it.

MR. DABNEY: We think it's working pretty well, sir.

COMMISSIONER RAMOS: Okay. Thank you.

VICE-CHAIRMAN ANGELO: Other questions or comments? Commissioner Henry?

COMMISSIONER HENRY: A general question — comment. One of the biggest complaints that I've received over the years are from hunters who complain, as we've talked about at this table before, that they can no longer afford lease fees.

Now, it's not all that it's put up to be on the fees, but there is some reason to this. My question is, to what extent are we looking at this question from the standpoint of public hunts?

Are we looking at it — are any of the plans to study this effort to see what can be done to make more available to the public? If that's possible, are other things possible? And is this something that you and the Wildlife Division are looking at jointly or separately?

MR. DABNEY: We do —

COMMISSIONER HENRY: Or something you're concerned about?

MR. DABNEY: We do. Every year, sir, we go through and we evaluate every single park that has any potential. A lot of them are too small. They just — you couldn't hunt on them. You wouldn't be shooting rifles in there. They're too close to cities, whatever.

We think that the 43 to 45 — and it ranges back and forth, that we're hunting now, are all that are practical to hunt, because of the size, because of where they're located. They're — or whatever.

We — the park system strongly supports this public hunting idea. It provides opportunities. Plus, there is some resource management value to that in dealing with the deer herds. If you're hunting everywhere else except on the park, then you're probably compounding your problems with too many deer.

COMMISSIONER HENRY: I'm not just talking about deer.

MR. DABNEY: We hunt other things as well. Yes, sir.

COMMISSIONER HENRY: And to what extent are we looking at increasing the number of hunting days, or anything else in that department?

MR. DABNEY: We're hunting, we think, as many species and during as much time as we can. What we start getting very quickly — if we're hunting at times that visitors traditionally come — and you can only hunt a few folks at a time with guns out there. But you're displacing a lot of folks that would be coming to enjoy the park as a park visitor. That will blow up on us faster than anything else.

Right now, the times that we hunt, during the middle of the week and that kind of thing, we really are not displacing park visitors. It's working well. When we try to extend the hunting opportunities by going in times when — you talked to me about that a little bit, Commissioner.

COMMISSIONER HENRY: Bermuda Triangle.

MR. DABNEY: Yes.

COMMISSIONER HENRY: Herb's Bermuda Triangle.

MR. DABNEY: It really doesn't' work. I mean, all these parks could be hunted more. But you're going to displace the park visitors in much greater numbers than you're going to accommodate hunts.

MR. COOK: I think it's safe to say, Commissioner Henry, in — to you and to your question and to the entire Commission, that between the Commission and the staff through the years, the goal has been to maximize that opportunity, and yet balance it with the state park use and the people who come to — you know, we stay away from weekends. We try to get some hunts in during the Christmas holidays when kids are out of school, those kinds of things.

Pretty well have, I believe, gone as far as we can on our state park property. Like Walt says, it depends on what's going on and kind of the calendar. But 42 or 43, 44 parks like that is about all we can do, and looking at the different species.

As far as looking for opportunity to provide more days, more spaces in our public hunting program — and I see Dr. Copeland is here and Mike Berger, who could certainly speak to it much better than I — we are constantly looking for —

You know, I'll use the Dove Lease Program as a classic example of a different type of program that provides a lot of hunting opportunity, where if it's not on our land, we go out and lease land that is otherwise just, from a farmer's standpoint, like grown up weeds.

That's exactly what we're looking for. Grow it up in sunflowers. And we can lease it for $3, $4, $5 an acre for a period of time, and allow hunting to go on there.

Herbert and I, here, a while back I saw some information coming across my desk about the paper companies — large paper companies — large acreages in East Texas. And you know, some of them get in. They stay in a few years. Some of them get out. Some of them sell their property. The U.S. Forest Service — we've got an opportunity to look at some additional acres there.

Of course, in some cases it's already in some sort of public hunting program that they don't even have to pay us the $40 for.

So we don't want to get into — you know, we try to balance those things — you know, I'll be honest with you. To go out and lease from private landowners, I mean, the primary source of land in Texas, the cost of the lease to us is rarely different than the cost of a lease to a lessee.

And for us to recover it is a — I've done some of that myself, of course, personally, in a previous life. And it is a task to recover, if we pay, again, at a reasonable price. So you know, we've looked at some large areas.

And you know, and suddenly our public hunting permit comes at a cost — just to retrieve costs, our public hunting permit for those areas might be $250 — $350 — $400 per permit. So we've wrestled with those same economics.

COMMISSIONER HENRY: I'm not aware that those certain things had been done in the past, a lot of good work that TWA, INS and others have done to bring kids in, and invite the public in to do some various kinds of things.

But more and more, particularly in meeting with groups, for example in the Houston area, this is the thing I hear more than any other thing. I'm just asking us to think outside the box, and to be cognizant of the fact that more and more, we're going to hear this, particularly from urban residents.

MR. COOK: Yes, sir.

COMMISSIONER HENRY: We need to be doing everything that we possibly can to address these issues. I know we've worked with the various — and organizations and all. We've got to encourage, you know, more of this, and hope we find different ways and new ways of doing this if we're going to serve these clientele.

So, like I said, that's really all I'm thinking about because it's — we are squeaking the loudest.

MR. COOK: Thank you, sir.

COMMISSIONER RAMOS: In line with what Commission Henry said, I echo that wholeheartedly. And the thought that I've had, and I think this would require legislation, would be some type of a tax credit to where there would be an incentive for a landowner to open up their properties for opportunities to hunt, be it a jackrabbit, be it a squirrel, be it a javelina, a coyote, anything.

But I think until we create that incentive for the landowners, it's going to be very difficult because of the economics of it.

But perhaps if the Legislature, somehow — and it can even be a local option bill, where each county would have the option to be part of that state program getting tax credits for those landowners that are willing to open up their places, on a limited basis, for the youth of the state.

That's something I've thought about —

VICE-CHAIRMAN ANGELO: We've kind of gotten off of our subject. Not that this isn't a real important subject, but we are off of our —

COMMISSIONER HENRY: I apologize.

VICE-CHAIRMAN ANGELO: That — no, that's all right, Commissioner. I think it's important, but we do need to get back on track here a little bit. And if there is no further discussion on this specific item, we'll put this on for tomorrow's agenda for public comment and action.

MR. DABNEY: Thank you.

VICE-CHAIRMAN ANGELO: Thank you, Walt.

We'll go on to Item Number 6, which is Grants. And Mr. Hogsett will make the presentation. Tim?

MR. HOGSETT: Good morning, Mr. Chairman, members of the Commission. This is our presentation of five grant programs that we're going to be bringing to you tomorrow for formal action.

The first program is our Outdoor Recreation Grants Program. I will mention that this is the first review in which we are faced with the 30 percent reduction that the Legislature made in our funds. So you're going to see recommendations of lower dollars than you're used to seeing.

For this six-month review, all the applications that we received for the January 31, 2003, deadline, 32 of those requesting a little over $14 million in matching funds. We have, as we always do, scored all of those projects using our scoring criteria that you have adopted, placed the projects in priority order by score, and are recommending — or will be recommending to you tomorrow that you support the top nine applications for an amount of $4,389,793 in matching funds.

And I'll be glad to answer any questions on that portion. And also we're adding a couple of other sort of housekeeping items to this particular agenda item. You'll recall that in January you approved the Transfer of Kerrville-Schreiner State Park to the City of Kerrville.

One of the things that we failed to include in that item, which the item had a capped amount which we could grant — use — grant funds to affect that transfer, we failed to take into account the fact that the City of Kerrville desires to continue to use our Central Reservation Center to make reservations for the facilities in that park.

We plan to accommodate that. And to do that, we — there are some necessary software purchases, and some other licensing purchases that have to be done. This would be a contractual arrangement that's very similar to the current contractual arrangement that we have for the Lower Colorado River Authority. So we'll be requesting —

VICE-CHAIRMAN ANGELO: And they would pay for that service, is that right?

MR. HOGSETT: Yes, they would pay $5 per reservation. We are simply just setting — with this money, setting up the system to allow us to do that.

Also in the 77th — I guess it was the — in the session prior to this legislative session that just closed — the 2001 and 2002 session, there was a rider attached to our Appropriations Act that requires us to allocate $1 million in a one-time grant to the City of Houston for the purpose of completing park restoration at Hermann Park.

We have now received an application from the City of Houston for that — for those funds, and we will be recommending tomorrow that we make that allocation as well. That was a statutorily appropriations mandate. So it's outside of the scoring system.

VICE-CHAIRMAN ANGELO: Is that anything that they hadn't gone through the process before with? Or is it just something continual?

MR. HOGSETT: No. It's all new work. A lot of renovation work, basically, of some old facilities in Hermann Park.

COMMISSIONER FITZSIMONS: I believe the question was —

VICE-CHAIRMAN ANGELO: No, I just wondered if they had ever brought this before us?

MR. HOGSETT: No. Typically, we don't do over $500,000 grants to any local government. Again, this was an appropriations mandate. It was attached to our Appropriations Act.

COMMISSIONER FITZSIMONS: So there is no match?

MR. HOGSETT: That is correct.

COMMISSIONER FITZSIMONS: There is just a grant.

MR. HOGSETT: These are the recommendations that we'll be bringing forward to you for tomorrow's meeting. I'll be glad to answer any questions that you might have.

VICE-CHAIRMAN ANGELO: Any questions on this part?

(No response.)

VICE-CHAIRMAN ANGELO: Why don't you go ahead, Tim.

MR. HOGSETT: The next program that we'll be bringing to you — recommendations to you tomorrow is our Regional Park Grant Program. It is a newer program that is designed to support multi-jurisdictional kinds of projects of regional significance in the metropolitan areas of the state.

And these can be projects, either intensive-use recreation, and/or regional conservation recreation projects. These are projects that, by their nature, cannot necessarily be accomplished by a single local government, but will require partnerships, both public and private partnerships.

We've received eight applications for our January 31, 2003, deadline requesting $15.4 million. Again, we applied the scoring system, evaluated each project using the criteria that you've adopted in the scoring system for regional parks.

And due to limitations of funds, are only recommending one project in the amount of $2 million. And that's for Harris County.

COMMISSIONER MONTGOMERY: Is the source of these funds the state?

MR. HOGSETT: It is — the Sporting Goods Tax. COMMISSIONER MONTGOMERY: And this is a new program we —

MR. HOGSETT: We've done about four reviews — annual reviews of this — with this program. Last session — last year you approved one project, again, only. And that was for LCRA to acquire and develop some property on Matagorda at the end of the river.

COMMISSIONER MONTGOMERY: And how do we allocate funds between this program and the Local Park Programs? Is that a legislative or is that a —

MR. HOGSETT: Well, one of the things that we did when we were faced with this 30 percent reduction by the Legislature in this last session — we convened the Chairman's Local Park Advisory Board and put the question to them of how do we feel about allocations of the resource that we have to the various programs?

And they were — they recommended that we continue with what we've traditionally done, about $2 million for this program.

COMMISSIONER MONTGOMERY: Two million annually? Or two million —

MR. HOGSETT: Two million annually. These are all —

COMMISSIONER MONTGOMERY: Okay.

MR. HOGSETT: — per year.

COMMISSIONER MONTGOMERY: Okay. Whatever amount we get from the Legislature, we tend to take two million a year —

MR. HOGSETT: That is correct.

COMMISSIONER MONTGOMERY: — and I remember the LCRA grant. I hadn't focused on the definition of this program.

VICE-CHAIRMAN ANGELO: Okay, Tim.

MR. HOGSETT: Any other questions?

(No response.)

MR. HOGSETT: She has the control. I think this thing has gone to sleep.

The next program that we're making recommendations to you is for the Small Community Grants. This is a relatively new program as well. It's for communities of 20,000 population or less, and grants not to exceed $50,000 in match.

It came out of a number of comments and public hearings that we held that told us that small communities have a difficult time competing in the larger program. And therefore, we were requested to do a set-aside. We have traditionally done this program once year, and approximately $1 million a year. Again, this is from the Sporting Goods Tax.

We received 35 applications for the January deadline, requesting $1.6 million. We, once again, rank-ordered the projects by score and are recommending the top 18 applications for a total of $858,354 in match. I'd be glad to answer any questions you have. This slide —

VICE-CHAIRMAN ANGELO: I think that's turned out to be a very good thing.

MR. HOGSETT: We are very pleased. We think that it's been very popular. Plus, it's sort of what broadened the constituency for all the program a whole bunch.

VICE-CHAIRMAN ANGELO: Any other comments?

(No response.)

VICE-CHAIRMAN ANGELO: Go ahead, Tim.

MR. HOGSETT: The next program is the National Recreational Trail Grants Program. These are federal pass-through funds from the U.S. Department of Transportation. The fund was created in 1991, and its revenue source is the gasoline tax from off-road recreational vehicle use.

I might point out that there is an error in the agenda item itself. The list which is found on pages 171 and 172 of projects was unfortunately printed in reverse order. So the top of the list basically is the top of page 172, the Big Bend Ranch State Park Project.

We will be recommending to you tomorrow — why don't you go ahead to the next one. This still isn't working. We will be recommending to you tomorrow the first 30 projects on page 172. I'd like to ask Andy Goldbloom from our staff to come up and tell you a bit about the project that you'll find at the bottom of that list on page 172, the Texas Motorized Trail Coalition Project.

I anticipate that you will be getting some public testimony, both in favor of, and opposed to that project, tomorrow.

VICE-CHAIRMAN ANGELO: Why should we not be surprised?

COMMISSIONER FITZSIMONS: You even said it.

MR. GOLDBLOOM: Thank you, Commissioners. My name is Andy Goldbloom. And I manage the Recreational Trails Programs with Tim in the Grant's branch.

In the last two weeks, we've received some letters of opposition to this acquisition of acreage in Uvalde County for a motorized trail area by adjacent landowners. And their concerns are valid. Access, some of the habitats — it's a very gorgeous piece of property and a good habitat.

We would still give you some background. Basically, we've had trouble getting sponsors to sponsor these motorized trail projects. Parks and Wildlife — we don't have any — cities and counties don't want to get into that business often. So a lot of the — it's been put on the back of this nonprofit. And they've spent a couple of years looking for an appropriate piece of property, and this is the one that —

VICE-CHAIRMAN ANGELO: Comment on what our obligation is with respect to the legislation it has to deal with, four-wheelers and what Parks and Wildlife's obligation is under that.

MR. GOLDBLOOM: It directs us to help find appropriate sites for acquisition. Now, I want to say we weren't involved in finding this particular site. I don't know if it would have, you know, come to the top of our list.

But again, we're basically reacting to what this nonprofit has given us as a project. If the funding is approved — they've already been approved for some funds for acquisition. Originally it was going to be closer to Rock Springs. That one fell apart. This property costs more than the one they were looking at, so this is basically a supplement to add funding to what they already have on the table.

This site — if the funds are recommended for it — because of the opposition and the nature of the funds being federal highway, and even if it were our state money, we're committed to having a public hearing in the local area.

It's also going to have to go through a lot of environmental resource groups for environmental assessment and other things like that, with additional public comment opportunity during those processes before the acquisition, and before the project actually comes off the ground.

VICE-CHAIRMAN ANGELO: Commissioner Henry.

COMMISSIONER HENRY: Mr. Chairman, generally, Tim, have we generally funded governmental units? And this is going —

MR. HOGSETT: Nonprofits and governmental entities are eligible for this program.

COMMISSIONER HENRY: Any nonprofit would be eligible.

MR. HOGSETT: A nonprofit that provides recreation opportunities of some sort.

COMMISSIONER HENRY: And this —

MR. HOGSETT: This Texas Motorized Trails Coalition — that's their whole reason for being, is to provide information exchange, education and places for people to participate. They have another site in East Texas that they bought in Gilmer, and it's been successful.

MR. GOLDBLOOM: That we funded with these grant funds. They've got a track record —

COMMISSIONER HENRY: In Gilmer?

MR. GOLDBLOOM: Yes, they've got a track record of managing it —

VICE-CHAIRMAN ANGELO: You might explain to the Commission what you all are proposing that — what action the Commission take with respect to this, which is somewhat different than the others where we're actually approving them.

In this particular case, what — explain exactly what it is we're being asked to do.

MR. GOLDBLOOM: Well, basically we're approving the obligation of the funds towards the project, with the knowledge that the project still has a lot of hoops with public comment opportunities to jump through before it can actually —

VICE-CHAIRMAN ANGELO: And it would have to come back to the Commission for a final approval?

MR. GOLDBLOOM: Well, typically they wouldn't. I mean, that's up to you.

VICE-CHAIRMAN ANGELO: In this particular case, wouldn't it be advisable that it come back to the Commission or not? What's the thinking on that?

MR. GOLDBLOOM: Basically we're asking you to give us the authorization, of staff, to proceed with trying to make the project on this site eligible for moving forward. If all the environmental clearances and other access issues and all can be ironed out, then we would ask you to allow us to move forward with the project.

If they don't pan out, if we're not able to get the clearances, then we'd be back at square one, and they — either the coalition could go out and look for another site that we would bring back to you for approval, or you know, we'd look at other options.

MR. COOK: Tim, how does the public input get weighed? Given that, as we take the next step and go to public hearings or continuing to receive comments —

MR. HOGSETT: If there is overwhelming public opposition to this, which we honestly don't believe there is going to be based on the conversations that Andy has had with local elected officials, et cetera, in that area — but if there is overwhelming public opposition, I think it would be advisable to come back —

COMMISSIONER HENRY: Who would hold the hearings?

MR. HOGSETT: Us and the coalition jointly would hold the hearing.

COMMISSIONER HENRY: Jointly.

MR. GOLDBLOOM: And federal highways would be involved. They're the administrative and federal —

COMMISSIONER MONTGOMERY: Who is the permitting authority? What were the permits required? Who is the — who actually —

MR. HOGSETT: Could be Cultural Resources Clearances from Texas Historical Commission, U.S. Fish and Wildlife Service for endangered species, for habitat. This is on Edward's Aquifer Recharge, so all the various entities that would have to make that kind of a clearance.

We have to go through all of those things before we can issue a contract for these people to purchase this property.

VICE-CHAIRMAN ANGELO: It's my — it's kind of my feeling, and I don't know how the rest of the group feels, but this is going to be — could be a pretty tough political-type discussion.

And while I think the Commission would be happy to have some of you all and some other entities maybe take the heat, it's probably the responsibility of the Commission, ultimately, to make that decision. And considering the fact that it's liable to be controversial, I think once you have gone through the process it probably ought to come back to the Commission, would be my thought. Is that what —

MR. HOGSETT: It seems fair to me.

VICE-CHAIRMAN ANGELO: — or what's the process?

COMMISSIONER FITZSIMONS: Well —

VICE-CHAIRMAN ANGELO: Commission Fitzsimons?

COMMISSIONER FITZSIMONS: Especially in light of the fact that its specific condition, four-wheel-drive, statute, bill, that we worked on, we never —

VICE-CHAIRMAN ANGELO: Well, we're obligated to pursue —

COMMISSIONER FITZSIMONS: In order to close the four-wheel-drive on the rivers, this was a condition that Parks would pursue this. So I think you're right, we have to refer to the —

VICE-CHAIRMAN ANGELO: It may be tough, and it may be something we still have to do even though it is tough, but it looks to me like if the procedure can be formulated to bring it back to the Commission, I think that's what ought to happen.

COMMISSIONER FITZSIMONS: I have a question for Tim on the money, from a — now, explain the federal funding for the — all the other states, California, Oklahoma, they've done it. It's — they're dedicating federal money for off-road —

MR. HOGSETT: It is, and that's where the money comes from, from the purchase of fuel by off-road vehicles. And there is a requirement. Andy is going to have to give me the number, because I don't recall. But there is a requirement that a certain percentage of the money that we receive for all these trail projects goes specifically for motorized activities.

And we, frankly, have not been able to fulfill that obligation in the past, simply because we've just not had enough groups or communities come forward and make requests for those kinds of funds.

COMMISSIONER HENRY: There is — are we doing this the same way we've done it with other nonprofit recreational groups, like the Bicycle Coalition, the Trail Rider — the equestrian people? They're following the same template?

MR. HOGSETT: Yes.

MR. GOLDBLOOM: With one exception. We don't have a cap on the amount of individual grants, because we have trouble finding sponsors for these projects. The rest of the grants — the nonmotorized projects — nature trails, are capped at $100,000. For the motorized projects, we —

MR. COOK: There is a lot of correlation here, it seems to me, that — and similarities. And Tim, help me out, in some of the Rails to Trails issues, where we have a group of people that — you know, and maybe communities at both ends of abandoned railway who would like to turn that into a public right of way/public use trail.

And in some cases, we get good support from landowners along the route, and in some cases, we get a lot of opposition. And those — that is always weighed.

But this being a big one, and involved as it is, based on some of the riverbed issues, be aware that I think that, you know, the timing of this, you know, if the landowner involved decides to bail, he decides to bail. If it sells to somebody else, it sells to somebody else.

But I think bringing it back and letting you all know exactly what we're hearing, what's going on in this case might be a wise step.

MR. HOGSETT: One other thing I think is worth pointing out, and it is the case of the Gilmer site that these people have already done. This isn't just an open, free-wheeling do whatever you want on this piece of property, it's a controlled, fenced environment. And that's what they desire. That's how they desire to manage it.

So there will be the opportunity to work with the site if some resource issues are found to at least, hopefully, mitigate some of those problems by the controlled use of the property.

COMMISSIONER FITZSIMONS: Who pays the staff and managing that site, and —

MR. HOGSETT: They do.

COMMISSIONER HENRY: They being?

MR. HOGSETT: The nonprofit, Texas Motorized Trail Coalition.

VICE-CHAIRMAN ANGELO: I think — it sounds like the consensus is there to do that. So when the recommendation is made tomorrow for a motion, it ought — it probably needs to include some specific language with respect to that particular angle.

MR. HOGSETT: Okay. We will do that.

VICE-CHAIRMAN ANGELO: Tim, if you're through, you might go ahead and take up your last item then.

MR. HOGSETT: The final item are our Target Range Grants. These are, again, Pass-through 75 percent matching monies from U.S. Fish and Wildlife through the Wildlife Restoration Act. They can be used for hunter education, as well as target and range shooting and skeet, and that sort of thing.

We've received four applications requesting a total of $165,000 in matching funds, and we'll be recommending you approve those for funding tomorrow.

VICE-CHAIRMAN ANGELO: Any questions on this last one?

(No response.)

VICE-CHAIRMAN ANGELO: There being none, we'll place all these items on the agenda for tomorrow's meeting for public comment and further action. Thank you very much.

MR. HOGSETT: Thank you.

VICE-CHAIRMAN ANGELO: Any other business to come before the Finance Committee? There being none, we will adjourn the Finance Committee and pass the gavel to Commissioner Fitzsimons for the Regulations Committee.

(Whereupon, the meeting was adjourned.)

C E R T I F I C A T E

MEETING OF: Texas Parks and Wildlife Commission Finance

LOCATION: Austin, Texas

DATE: August 27, 2003

I do hereby certify that the foregoing pages, numbers 1 through , inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Parks and Wildlife Commission.

9/12/03

(Transcriber) (Date)

On the Record Reporting, Inc. 3307 Northland, Suite 315

Austin, Texas 78731