Focus Report, Volume 75, Number 8, February 1997 Page: 4
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House Research Organization
the fund of approximately $19.8 million a year for
fiscal 1996 and 1997. The agency is also allocated
additional monies from the fund as authorized by
Rider 29 of the General Appropriations Act. Rider
29 allows TNRCC to use collected revenue that ex-
ceeds $24 million each year, provided that annual
appropriations for the program do not exceed $31
million. The additional appropriation allowed by
Rider 29, however, was only $5.4 million in fiscal
1996 and is estimated to be $5 million in 1997.
Annual appropriations, then, total approximately $25
million for fiscal 1996 and 1997. These sums fall
short of the approximately $31 million needed to
fund the waste tire recycling activities set out in SB
776.
Under SB 776, the 1995 Legislature allocated a
special additional appropriation of $9.34 million to
TNRCC from the waste tire recycling fund to pay
tire processor reimbursement claims. In April 1996
the program was shored up with a $4.2 million emer-
gency deficiency grant from the Governor's Office.
TNRCC will have to seek additional funds in 1997
in order to fund all provisions of SB 776. Lack of
funds has caused the agency to suspend cleanup of
illegal dump sites, except sites that are a direct
threat to human health.
Meanwhile, because the Legislature has not appro-
priated all revenue collected since the program's
inception, the fund had a balance at the end of fis-
cal 1996 of $16 million. That balance will be a
projected $19 million by the end of fiscal 1997.
TNRCC has asked the 75th Legislature for autho-
rization to use all waste tire recycling fund fees to
support the program until December 1997, the
program's sunset date. If the program is continued
by the Legislature, the agency may ask the Legisla-
ture for permanent authorization to use all waste tire
recycling fund fees.
Collection
Tire collection problems surfaced in West Texas
after reimbursements were trimmed from 85 to 80
cents per tire. Reduced fees, rising fuel costs and the
long distances between communities in West Texas
made it economically unfeasible for many transport-
ers to continue collecting waste tires from dealers.
As a result, tire dealers in West Texas had trouble
getting their tires picked up. Piles of discarded tires
began to accumulate around their businesses.To alleviate the situation, in June 1996 TNRCC
awarded contracts for collecting used tires in six
West Texas regions - Abilene, Amarillo, El Paso,
Lubbock, Midland and San Angelo - containing
nearly 2,500 generators. The contracts require des-
ignated transporters to pick up all the scrap tires
within their region from dealers and take them to
processors for recycling or to temporary state-desig-
nated collection sites. Transporters are reimbursed
approximately 40 cents per tire from the waste tire
recycling fund. Future handling of the temporary
collection sites may be tackled in the current session.
Fraud
TNRCC has also encountered problems with some
tire processors filing phony reimbursement claims. A
total of 31 tire processors - both tire shredders and
burners - are registered in Texas, and about half of
them currently are receiving reimbursements. In
1994 TNRCC began auditing six waste tire process-
ing facilities. The facilities were selected for fiscal
audit in part because of the amount of reimburse-
ments the processors had received. Four of the six
audits found overpayments totalling $21,109.10; the
processors involved have since repaid the amounts
owed. The other two audits, TNRCC says, show
overpayments of at least $95,000 and the processors
in these cases are contesting TNRCC findings. Un-
der the SB 776 mandate, TNRCC has begun auditing
all tire processors who have received reimbursements
since 1995.
Recommendations for Action
Financing proposals
The Senate Natural Resources Subcommittee re-
port recommends that the waste tire recycling
program be continued but with substantial changes.
The subcommittee recommends immediately eliminat-
ing all reimbursements to processors who merely
shred tires and instead use the waste tire funds only
as incentives for certain end uses. These would in-
clude using chips in landfill liners, various rubber
products, and road construction and burning tires in
industrial kilns and boilers. Since only end users of
the rubber would be reimbursed, processors would
not be paid for shredding tires unless a verified use
for those shreds was guaranteed. Although current
law already emphasizes end uses, allowing processorsPage 4
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Texas. Legislature. House of Representatives. Research Organization. Focus Report, Volume 75, Number 8, February 1997, periodical, February 25, 1997; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth640741/m1/4/: accessed May 21, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.