LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
March 5, 1995
TO: Honorable Curtis Seidlits, Chair IN RE: Senate BillNo. 102,
Committee on State Affairs as engrossed
House of Representatives By: Bivins
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on Senate Bill No.
102 (Relating to state employee contributions to the federal old
age and survivors insurance program.) 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 eliminate the state's contribution for the
employees' share of social security taxes, beginning January 1,
1996, and replace it with a supplemental pay increase for current
state employees (i.e. those employed by the state as of August
31, 1995). Under current law, the state contribution for the
employee's share of social security taxes equals 5.85 percent of
the first $16,500 earned in a calendar year. The maximum
contribution is $965.25 a year.
In addition to the supplemental increase, the bill would require
the state to pay for the employees' share of the additional
retirement contribution that ordinarily would be incurred by
converting social security contributions into direct employee
compensation.
Employees hired after August 31, 1995 would not be entitled to
the state-paid social security taxes or the supplemental pay
increase. Current employees who terminate from state employment
and return within two years would receive the supplemental pay
increase and employee retirement contribution offset.
Implementation of these provisions would be contingent upon the
legislature appropriating sufficient funds for the supplemental
pay increase and retirement contribution offset.
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 Savings Probable Savings Probable Savings
Year from General from General from General
Revenue Fund 001 Revenue Fund 001 - Revenue Fund 001 -
- Consolidated - Dedicated
1996 $1,743,000 $165,000 $473,000
1997 15,479,000 1,467,000 4,203,000
1998 30,761,000 2,915,000 8,353,000
1999 44,973,000 4,262,000 12,212,000
2000 58,224,000 5,518,000 15,810,000
Fiscal Probable Savings
Year from Other Funds
1996 $296,000
1997 2,625,000
1998 5,216,000
1999 7,625,000
2000 9,872,000
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: Comptroller of Public Accounts
LBB Staff: JK, RN, DF