BILL ANALYSIS


                                                        S.B. 1417
                                                        By: Truan
                                                          Finance
                                                          4-28-95
                                     Committee Report (Unamended)
BACKGROUND

During the 73rd Legislature, S.B. 1332 directed the Legislative
Budget Board to "examine methods to identify and quantify the
spending interrelationships between functional areas, agencies,
goals, objections, and strategies."

In response to S.B. 1332, the board staff reviewed the concept of
spending interrelationships as it relates to Texas' efforts to
implement strategic planning and performance budgeting on a state
level, and after this review, the board concluded that investment
budgeting is the next logical step for Texas to take in the
evolutionary development of its Strategic Planning and Performance
Budgeting System.

PURPOSE

As proposed, S.B. 1417 establishes an investment budgeting pilot
project for state spending.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. (a)  Requires the Legislative Budget Board (board) to
establish a pilot project for and develop the criteria for the
implementation of investment budgeting for state spending.

     (b)  Requires the board to examine the long-term consequences
     of budget alternatives; focus on allocating resources to fund
     cost-effective measures; select state-level benchmarks and
     agency-specific outcomes for investment analysis; oversee the
     investment analysis; and recommend ways that the state
     appropriations process may be revised to incorporate the use
     of investment budgeting.
     
SECTION 2. Requires the board to submit to the governor and the
75th Legislature a report concerning the effectiveness of the pilot
project.

SECTION 3. Provides that this Act expires September 1, 1997.

SECTION 4. Emergency clause.
           Effective date:  90 days after adjournment.