LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session April 2, 1995 TO: Honorable John T. Montford, Chair IN RE: Senate BillNo. 1019 Committee on Finance By: Rosson Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on Senate Bill No. 1019 (Relating to social security coverage of certain student employees of public institutions of higher education.) this office has determined the following: The bill would exempt certain student employees of institutions of higher education from Social Security coverage. The bill would define "student employee" as a student enrolled and regularly attending classes in an institution of higher education and who is employed by an institution for no more than 30 hours a week during a regular or summer session. The bill would require the Comptroller to reduce any remaining General Revenue Fund transfers to be made to an institution of higher education for the 1996-97 biennium by one-half of an institution's remaining contributions to be made for student employees under Section 606.064 of the Government Code. This reduction would only apply to contributions for student employees paid entirely from the General Revenue Fund. The bill would take effect upon an agreement between the State of Texas and the Social Security Administration providing that student employees of institutions of higher education were excluded from Social Security coverage. The bill would result in a savings to the General Revenue Fund by exempting student employees working 30 hours a week or less from Social Security coverage. Thus, the state would not be required to pay either the state Social Security matching contribution (7.65 percent of wages) or the state contribution toward an employees' share of Social Security taxes (5.85 percent of wages up to a maximum wage of $16,500, or $965 dollars per year). These savings, however, cannot be estimated because of insufficient information concerning the number and wage rates of student employees working 30 hours a week. No fiscal implication to units of local government is anticipated. The fiscal implication to the State cannot be determined. Source: Comptroller of Public Accounts, Higher Education Coordinating Board LBB Staff: JK, RN, DF