HB304: relative to state acquisition of certain acreage in the Connecticut Lakes headwaters tract and making an appropriation therefor.

HB 304-A - AS AMENDED BY THE HOUSE

10apr03... 0945h

2003 SESSION

03-0725

06/09

HOUSE BILL 304-A

AN ACT relative to state acquisition of certain acreage in the Connecticut Lakes headwaters tract and making an appropriation therefor.

SPONSORS: Rep. Chandler, Carr 4; Rep. Whalley, Belk 31; Rep. King, Coos 1; Rep. Stohl, Coos 1; Sen. Cohen, Dist 24; Sen. Clegg. Dist 14; Sen. Eaton, Dist 10

COMMITTEE: Resources, Recreation and Development

ANALYSIS

This bill makes a capital appropriation to the department of resources and economic development to provide funds to purchase certain property in the Connecticut Lakes headwaters tract.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

10apr03... 0945h

03-0725.0

06/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Three

AN ACT relative to state acquisition of certain acreage in the Connecticut Lakes headwaters tract and making an appropriation therefor.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Statement of Purpose. The purpose of this act is to make funds available to the department of resources and economic development for the purchase of certain acreage in Pittsburg, Clarksville, and Stewartstown, known as the Connecticut Lakes headwaters tract.

2 Authority. The commissioner of the department of resources and economic development may, in the name of and on behalf of the state, purchase fee real estate consisting of approximately 146,400 acres in Pittsburg, Clarksville, and Stewartstown, New Hampshire.

3 Appropriation. The sum of $12,000,000 is hereby appropriated to the department of resources and economic development for the purchase of a certain tract of land located in Pittsburg, Clarksville, and Stewartstown, known as the Connecticut Lakes headwaters tract.

4 Bonds Authorized. To provide funds for the appropriation made in section 3 of this act, the state treasurer is hereby authorized to borrow upon the credit of the state a sum not to exceed $12,000,000 and for said purpose may issue bonds and notes in the name of and on behalf of the state of New Hampshire in accordance with RSA 6-A. Notwithstanding the provisions of RSA 227-G:5, I, payments of principal and interest on the bonds and notes shall be made from the forest management and protection fund established in RSA 227-G:5, I.

5 Effective Date. This act shall take effect July 1, 2003.

LBAO

03-0725

Amended 5/12/03

HB 304 FISCAL NOTE

AN ACT relative to state acquisition of certain acreage in the Connecticut Lakes headwaters tract and making an appropriation therefor.

FISCAL IMPACT

The Treasury Department has determined that this bill, as amended by the House (House Amendment #2003-0945h), will increase state general fund expenditures by $300,000 in FY 2004, by $1,302,000 in FY 2005, $1,266,000 in FY 2006 and by, $1,230,000 in FY 2007. There is no fiscal impact on county and local expenditures or on state, county and local revenues.

The Department of Resources The Department of Resources and Economic Development has determined that this bill will increase state restricted revenues and expenditures by an indeterminable amount in FY 2004 and each year thereafter. There is no fiscal impact on county and local revenues and expenditures.

This bill increases other state supported bonded indebtedness by $12,000,000.

METHODOLOGY:

The Treasury Department has indicated that the amount of total projected outstanding direct general obligation bonded indebtedness on behalf of and incurred by the state as of December 31, 2002 is $561 million. The projected amount of net general obligation bonded indebtedness (general improvement plus University System of New Hampshire bonds), as of December 31, 2002 is $454 million. The amount of net general obligation bonds authorized, but unissued as of December 1, 2002 is $106,310,671.

The Treasury Department has assumed that one-half of the proposed bond authorization will be issued in FY 2004 and one-half in FY 2005. Current Interest Bond rates are fixed at 5% and amortized over 20 years (60% of the principal paid in the first ten years, 40% paid in the second 10 years). An estimated debt retirement schedule for all outstanding general fund bonded indebtedness, including the proposed authorization contained in this bill through FY 2007, is displayed below:

FISCAL YEAR ENDING

DEBT

SERVICE

ADDITIONAL

DEBT SERVICE

TOTAL

2003

$74,091.322

$0

$74,091,322

2004

$74,968,323

$300,000

$75,268,323

2005

$71,125,988

$1,302,000

$72,427,988

2006

$65,576,996

$1,266,000

$66,842,996

2007

$60,657,540

$1,230,000

$61,887,540

The Department of Resources and Economic Development (DRED) estimated the fiscal impact of this bill in the table below using the following assumptions:

· The annual timber harvest is calculated at the rate of tree growth.

· The per unit values for wood harvested is based on current stumpage returns at Nash Stream.

· The additional revenue from camp leases and from the monitoring endowment is included.

· The management expenses are estimated using the average of two methods: a percentage of income plus road expenses, and the current per acre cost of the management of Nash Stream.

· The major expenses included in the management expenses are timber sale lay out, compliance with terms similar to what is in the conservation easement, putting the sales out to bid, supervision of the timber sale, and road and bridge maintenance.

DRED further states that since the net income from the property alone does not cover the bond payment starting in FY 2005, the remaining income would be derived from increasing the timber harvest on the remaining DRED lands. The positive cash flow from the property in the first year is assumed to be carried over to the second year.

FY 2004 FY 2005 FY 2006 FY 2007

Revenue

Timber Revenue $920,800 $ 920,800 $ 920,800 $ 920,800

Camp Leases 77,500 101,750 125,000 125,000

Monitoring Endowment 0 75,000 75,000 75,000

Increase Harvesting of

DRED Lands 0 577,730 842,170 791,584

Total $998,300 $1,675,280 $1,962,970 $1,912,384

Expenditures

Average Management $450,568 $ 452,387 $ 454,130 $ 454,131

Debt Service 300,000 1,302,000 1,266,000 1,230,000

Incr. Harvesting Costs 0 168,625 242,840 228,253

Total Expenditures $750,568 $1,923,012 $1,962,970 $1,912,384

Net Revenue Over

Expenditures $247,732 ($ 247,732) $ 0 $ 0