LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  March 31, 1997
         
         
      TO: Honorable Harvey Hilderbran, Chair            IN RE:  House Bill No. 1909
          Committee on Human Services                              By: Maxey
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on HB1909 ( Relating 
to the methods used to extend the period of supported employment 
for TANF families.) this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by HB1909-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.

The bill would amend Chapter 31 of the Human 
Resources Code by adding Section 31.043.  The bill would require 
the Department of Human Services to use a form of fill-the-gap 
budgeting to extend the period of supported employment for families 
who receive financial assistance.

The bill would amend Sections 
7.06, Chapter 655, Acts of the 74th Legislature, Regular Session, 
1995.  The department would notify members of the 76th and 77th 
legislatures on the program's success in assisting families 
in becoming more self-sufficient.  The department would revise 
the pilot program to implement statewide the "fill-the-gap" 
budgeting program, and reflect the method of extending transitional 
benefits to 24 months as the sole method used in the program. 
 Federal approval could be required to implement the bill.
         
 
Fiscal Analysis
 
The fiscal note assumes Temporary Assistance for Needy Families 
(TANF) block grant funding would be available to fund expansion 
of fill-the-gap budgeting.  The note assumes Child Care Development 
Block Grant (CCDBG) funding would be available to fund extended 
child care benefits.  Any amount not funded with federal funding 
would be a cost to the General Revenue Fund.
 
Methodolgy
 
Extending fill-the-gap budgeting to all Texas AFDC/TANF recipients:

--An 
incremental increase of $431,000 per year would be paid to clients 
already receiving extended benefits through federal guidelines.

--Approximately 
21,703 clients not eligible for extended benefits through federal 
guidelines would receive extended benefits through fill-the-gap 
budgeting.  Additional benefits would average $23.18 per person 
per month.  The yearly amount would be $6,037,000.


The 
pilot program is expected to begin September 1, 1997 and end 
August 31, 2002.  The impact of extending transitional benefits 
from 12 to 24 months would begin in 1999, the second year of 
the pilot.

Child Care Benefits: 

--In 1999, 1,375 additional 
children would qualify for child care services.  Only 426 children 
(or 31%) are expected to participate. At a rate of $12.52 per 
day (X) 21.7 days per month (X) 12 months, the yearly cost would 
be $1,389,664.

--In the following years, 1,688 additional 
children would qualify for child care services.  Only 523 (or 
31%) are expected to participate.  At a rate of 21.7 days per 
month (X) 12 months (X) $12.52 per day, the yearly cost would 
be $1,706,002.

Medical Benefits: 

No additional cost is 
assumed, as persons requiring medical services would be treated 
through the Medically Needy program. 
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                                                                                  
            0555                                                                                           
       1998      ($6,486,000)                                                                        
       1998       (7,857,664)                                                                        
       2000       (8,174,002)                                                                        
       2001       (8,174,002)                                                                        
       2002       (8,174,002)                                                                        
 
 
         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
 
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 ,PP