LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
May 5, 1995
TO: Honorable Irma Rangel, Chair IN RE: Committee Substitute
Committee on Higher Education for
House of Representatives HouseBill No.
Austin, Texas 2247
FROM: John Keel, Director
In response to your request for a Fiscal Note on House Bill No.
2247 (Relating to the transfer of the University of Central Texas
to The Texas A&M University System) 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 transfer the University of Central Texas to Texas
A&M University System if the board of trustees of the institution
and the Texas A&M University System board of regents agree to the
transfer and the transfer is approved by the Higher Education
Coordinating Board by August 31, 1996. If all parties agree to
the transfer, the University of Central Texas would be
transferred effective September 1, 1996. The bill would
authorize the Texas A&M University System to govern, operate,
manage, and control the institution and all land, buildings,
facilities, improvements, equipment, supplies, and property. The
bill would transfer all contracts and written obligations,
employees, and funding of the University of Central Texas to the
Texas A&M University System.
The bill would make Texas A&M University - Central Texas
ineligible to receive funding under Sections 17 or 18, Article
VII, Texas Constitution relating to the Higher Education Fund and
the Permanent University Fund.
The bill would establish Texas A&M University - Central Texas as
an upper level educational institution as part of the Texas A&M
University System. The bill would require the institution to
accept only junior, senior and graduate-level students. The bill
would authorize the institution to award the degrees which it
currently awards and would require that new degree programs be
subject to the approval process required of public institutions
of higher education.
Current headcount enrollment at the University of Central Texas
is 858 with approximately 25 percent of those students enrolled
as full time students. It is assumed for purposes of this fiscal
note that Texas A&M University - Central Texas would enroll 400
full time equivalent students beginning in 1997 and that
enrollment would increase by 25 full time students each year. It
is estimated that each full time equivalent student would cost
$4,700 in general revenue and $900 in other educational and
general income. Since the base period for 1996-97 formula
funding is already established, it is assumed that formula
funding for the new institution would not begin until fiscal year
1998. However, if the institution is established the Legislature
could provide start up funding for fiscal year 1997. It is
assumed that the institution would generate approximately
$360,000 in other educational and general income (primarily
tuition) in 1997, increasing to $425,500 by fiscal year 2000 to
be used for educational and general purposes.
It is assumed for purposes of this fiscal note that Texas A&M
University - Central Texas would have an estimated 60 employees
that would become state employees in fiscal year 1997 for the
purposes of employee benefits and that the average salary would
be $24,000. In 1997 these costs would be paid from tuition and
fee income available to the institution. Beginning in 1998 the
increased cost to the State for employee benefits would be an
estimated $432,000 with 80 percent paid from general revenue and
20 percent paid from other educational and general funds. The
amounts shown in the table below reflect only the $345,600 per
year from general revenue.
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 Out Probable Cost Out Change in
Year of General of General Number of State
Revenue Fund 001 Revenue Fund 001 Employees from
for Formula for Employee FY 1995
Funding Benefits
1996 $0 $0 .0
1997 0 0 60.0
1998 1,997,500 345,600 60.0
1999 2,115,000 345,600 60.0
2000 2,232,500 345,600 60.0
Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.
No fiscal implication to units of local government is
anticipated.
Source:
LBB Staff: JK, LS, WRR