LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
May 15, 1997
TO: Honorable Judith Zaffirini, Chair IN RE: House Bill No. 942, As Engrossed
Committee on Health & Human Services By: Hilderbran
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on HB942 ( Relating
to the AFDC and Medicaid benefits to children born to AFDC recipients.)
this office has detemined the following:
Biennial Net Impact to General Revenue Funds by HB942-As Engrossed
Implementing the provisions of the bill would result in a net
impact of $0 to General Revenue Related Funds through the biennium
ending August 31, 1999.
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 prohibit the Department of Human
Services from providing financial assistance for support of
a child born to a recipient of Temporary Assistance for Needy
Families (TANF) at least 10 months after the date on which the
recipient initially began receiving the assistance if the paternity
of the dependent child has not been established for the purpose
of enforcing child support and if the recipient already has
two or more children.
Fiscal Analysis
If an adult recipient of financial assistance becomes the parent
of another child while the recipient is receiving assistance,
the department must deduct the earned income disregards allowed
under federal law, and increase the amount of earned income
disregard for an employed recipient by 50 percent of the amount
granted under Human Resources Code Section 31.003, adjusted
for family size. Even though ineligible for financial assistance
under the provisions of the bill, the latter born child would
still be eligible to receive child care, support services, and
Medicaid.
Methodolgy
To estimate the fiscal impact of the provisions of the bill:
1) data were reviewed on the number of children born during
fiscal year 1996 to mothers on AFDC and who had been on AFDC
at least 10 months prior to the birth of the child;
2)
data were reviewed to establish the number of cases denied
benefits due to lack of cooperation on paternity establishment;
3) estimated the number of births based on the projected
AFDC caseload which would correspond to the parameters established
in the provisions;
4) assumed a 93 percent monthly retention
rate for AFDC/TANF cases and modeled cases over time;
5) calculated the average TANF grant reduction of $33.33 when
the case is reduced by one child;
6) multiplied the projected
case-months by the reduced cases to obtain expenditure savings;
7) calculated the clients per month by dividing the total
dollars by dollars per client per month by 12 months per year.
It
is anticipated that there will be minimal impact to staffing,
thus no salary costs or FTEs or computer adaptations will be
needed to implement the provisions of the bill.
The savings
are assumed to be from federal funds (Temporary Assistance for
Needy Families block grant ) since the state is required to
maintain its level of effort in general revenue spending. Savings
in cash benefits are lowered in the first year because the policy
does not go into effect until July 1998 (10 months after the
bill would go into effect).
The probable fiscal implications of implementing the provisions
of the bill during each of the first five years following passage
is estimated as follows:
Five Year Impact:
Fiscal Year Probable
Savings/(Cost)
from Federal
Funds: TANF
Block Grant
0555
1998 $2,057
1998 51,761
2000 88,558
2001 103,650
2002 109,967
Net Impact on General Revenue Related Funds:
Fiscal Year Probable Net Postive/(Negative)
General Revenue Related Funds
Funds
1998 $0
1999 0
2000 0
2001 0
2002 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: Agencies: 324 Department of Human Services
LBB Staff: JK ,BB ,AZ