LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session May 15, 1997 TO: Honorable Bill Ratliff, Chair IN RE: House Bill No. 571, As Engrossed Committee on Finance By: Rangel Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB571 ( Relating to exempting certain educational aides from tuition and fees charged by institutions of higher education.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB571-As Engrossed The Coordinating Board could incur administrative expenses to certify eligible students and to reimburse colleges for the exempted charges. These costs could be paid from general revenue funding. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. Fiscal Analysis The bill would exempt certain educational aides from tuition and fees charged by institutions of higher education. The exemption authorized by this bill is not a mandatory exemption. The bill would amend the Education Code, Chapter 54.213 which allows institutions to fund the exemption with local funds or any funds appropriated to the institution but does not require an institution to provide exemptions beyond those funded through appropriations specifically designated for the program. Chapter 54.213 would also allow exemptions to be funded from savings to the Foundation School Fund that occur as a result of the Early High School Graduation Scholarship Program. This funding source would only be available after funding any exemptions authorized under the Early High School Graduation Program or the AFDC program. The methodology that the Texas Education Agency has used to implement the savings to the Foundation School Program for the Early High School Graduation and the AFDC Scholarship Program is based on the actual amount of the tuition exemptions given. No unobligated savings to the Foundation School Program result from these exemptions. The TEA could fund the exemption proposed by this bill in the same manner or the Legislature could specifically appropriate general revenue funds to fund the exemption. Methodology The Texas Education Agency estimates that the maximum number of educational aides eligible for this program would be 16,366; however, the agency states that it is probable that far fewer than that number would actually meet the criteria established by the bill. The Texas Higher Education Coordinating Board estimates the amount of tuition and fees to be exempted per student through this program would equal $1,076 in FY1998 assuming the student is enrolled half-time and would rise to $1,621 per student in FY 2002. If 16,366 aids received the exemption, the potential cost of this program would be $17.6 million in 1998, rising to $26.5 million in fiscal year 2002 due to increases in tuition and fees. No fiscal implication to units of local government is anticipated. Source: Agencies: 781 Higher Education Coordinating Board 701 Texas Education Agency - Administration LBB Staff: JK ,RR ,LP ,DH ,LD