Summary of Report 01-011

Natural Resources

A Joint Study Report on The Parks and Wildlife Department's Commercial Fishery Programs and The General Land Office's Leases of State-Owned Lands

December 2000

Report Number 01-011

Overall Conclusion

Neither the Parks and Wildlife Department (Department) nor the General Land Office (Office) is recovering the full cost of administering certain revenue-generating programs related to commercial fisheries and surface leases of state-owned land. Lack of sound cost allocation for these programs prevents the two agencies from adequately analyzing their cost and fee structures. In addition, the private oyster-bed leases administered by the Department do not appear to have basic terms and conditions to protect the interests of the State. It appears that the value of the Department's oyster-bed leases and the Office's coastal cabin lease permits exceed the income realized by the State for these leases.

Key Facts and Findings

Parks and Wildlife Department

The Department did not recover approximately $9.3 million of the costs for administering the commercial fishery programs in fiscal year 1999.
The Department estimates that it spent approximately $95,190 in fiscal year 1999 to manage and enforce the private oyster-bed leases. During the same period, the leases earned $47,404 in license fees and lease revenue.
The Department manages approximately 2,327 acres of private oyster-bed leases, recovering $3 per acre per year. The estimated value of such leases is approximately $1,000 per acre, based on the sales comparison method of appraisal performed by an independent appraiser.

General Land Office

The Office did not recover the costs of administering four of its seven surface lease types for fiscal years 1998 and 1999, with one lease type not recovering approximately $1 million of its costs. However, in total, these seven lease types collect more revenue than it costs to administer them.
The majority of the revenue collected from the leases goes to the Texas Education Agency's Available School Fund and Permanent School Fund. The costs to administer the leases are paid from the Office's General Revenue Fund appropriations.
The Office issues lease permits for 435 coastal cabins. The cabin structures are built, paid for, and maintained by the permit holders, but are owned by the State. The Office assesses an annual rent of $0.60 per habitable square foot. The estimated value of the structures is $18 per square foot, based on a depreciated replacement cost appraisal performed by an independent appraiser.