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