LEGISLATIVE BUDGET BOARD
                          Austin, Texas

                           FISCAL NOTE
                       74th Regular Session

                          March 14, 1995



 TO:     Honorable Irma Rangel, Chair           IN RE:  House Bill No. 420
         Committee on Higher Education                  By: Ogden
         House of Representatives
         Austin, Texas







FROM: John Keel, Director

In response to your request for a Fiscal Note on House Bill No.
420 (Relating to the admission standards, tuition, fees, and
governing boards of general academic teaching institutions and
university systems and to testing and remedial education by
public institutions of higher education) this office has
determined the following:

The bill would make no appropriation but could provide the legal
basis for an appropriation of funds to implement the provisions
of the bill.

The bill would :
       1) require each governing board to set admission standards
for general academic institutions which ensure that each admitted
student is prepared to do college-level course work;
       2) limit governing boards' expenses, reimbursements,
naming of buildings, employment at institutions, contracting,
alcohol use, and term limits.  It would also permit the Governor
to remove a board member for cause and require boards of regents
to conduct public hearings before increasing tuition and fees;
       3) require the Coordinating Board to study the
organization and governance of public institutions of higher
education; and
       4) repeal the Texas Academic Skills Program (TASP),
V.T.C.A., Education Code Sections 51.306 and 51.3061.

The estimates for costs to local government are based on the
assumption that 13,699 students currently admitted to public
senior colleges and universities would not qualify for admission    




and would choose to attend a local community college.  The shift 
of students from the senior colleges to community colleges would
cost the local colleges an estimated $17.8 million annually
(based on the current estimated cost to local taxing authorities
of $1,300 per student).  However, there would be local savings to
community colleges due to reduced demand for required remedial
work.  These savings are estimated at $6.5 million annually, for
a net cost to local community colleges of $11.3 million per year.

The estimates for general revenue savings are based on the
assumption of shifting 13,699 students from senior to community
colleges for a reduced demand for formula funding of $33.1
million annually.  Reduced demand for formula funding for
remedial courses at community colleges is estimated at $8.1
million annually.  The repeal of TASP would decrease annual
administrative costs at the Coordinating Board by $240,000
annually.

The probable fiscal implication of implementing the provisions of
the bill during each of the first  five years following passage
is estimated as follows:




     



          Fiscal  Probable Cost to    Probable Savings 
          Year          Local                to        
                  Community College   General Revenue  
                      Districts           Fund 001     
                                                       
          1996           $11,300,000        $41,400,000
          1997            11,300,000         41,400,000
                                                       
          1998            11,300,000         41,400,000
                                                       
          1999            11,300,000         41,400,000
          2000            11,300,000         41,400,000
                                                       
                                                       
                                                       

       Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.


Source:   Higher Education Coordinating Board
          LBB Staff: JK, MK, WRR