LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session March 31, 1997 TO: Honorable Harvey Hilderbran, Chair IN RE: House Bill No. 1784 Committee on Human Services By: Hilderbran House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB1784 ( Relating to the amount of assistance granted under the financial assistance program for persons with dependent children.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB1784-As Introduced 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. Fiscal Analysis The bill would require the Department of Human Services to increase the amount of financial assistance to a Temporary Assistance for Needy Families (TANF) recipient who is participating in work or employment activities. The amount would be added to cover the recipient's incidental work costs but may not exceed ten percent of the family grant amount. Methodolgy The Texas Workforce Commission provided an estimate that 42,000 TANF cases/families would meet the requirement to receive an additional grant. The Department of Human Services assumed that each work participant family would receive a $16 monthly grant increase in order to make the incentive as large as possible without exceeding the ten percent threshold established in the bill. This assumption also allows implementation of the provisions without an overall increase in TANF grant benefits. Because grant benefits cannot decrease below 1988 levels due to provisions in the Personal Responsibility and Work Opportunity Act of 1996, decreases in grant amounts are assumed for all recipients to ensure that the reductions in grant do not fall below the minimum 1988 level. The grant reduction is approximately $3.50 per case/family per month. Clients that would participate in the JOBS employment program would also receive the reduction but would also receive the $16 increase, with a net increase of an estimated $12.50 per month. The fiscal implications/costs to Temporary Assistance for Needy Families federal block grant correspond to programming alterations to modify the payment standards on the DHS computer systems. Because the provisions of the bill would not allow support services (such as child care, transportation, job search assistance, etc.) in the aggregate to increase, it is assumed that TWC would be able to absorb any administrative changes necessary. The method of finance for implementation of the provisions of the bill assumes that federal funds from the Temporary Assistance for Needy Families block grant would be used for the administrative changes necessary to implement the provisions of the bill. In the event that these funds are not available, general revenue funding may be needed. 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 (Cost) from Federal Funds: Temporary Assistance for Needy Families Block Grant 0555 1998 ($1,059,000) 1998 0 2000 0 2001 0 2002 0 Net Impact on General Revenue Related Funds: The probable fiscal implication to General Revenue related funds during each of the first five years is estimated as follows: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $0 1999 0 2000 0 2001 0 2002 0 No fiscal implication to units of local government is anticipated. Source: Agencies: 324 Department of Human Services 320 Texas Workforce Commission LBB Staff: JK ,BB ,AZ