LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session March 17, 1997 TO: Honorable Rodney Ellis, Chair IN RE: Senate Bill No. 34 Committee on Jurisprudence By: Zaffirini Senate Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on SB34 ( Relating to the parent-child relationship, suits affecting the parent-child relationship, and the protection of children.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by SB34-As Introduced Implementing the provisions of the bill would result in a net positive impact of $10,677,164 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 several chapters of the Family Code relating to children in the managing conservatorship of the Department of Protective and Regulatory Services. It would also require the Office of Court Administration to prepare an annual report on judicial efficiency in certain family law cases pertaining to these children. Fiscal Analysis A number of the bill's provisions would have no significant fiscal impact. These include requiring a man to declare paternity within 30 days of the birth of a child; authorizing the court to use new grounds for terminating the parent-child relationship; requiring the Department of Protective and Regulatory Services (PRS) to maintain a computerized database of foster care and adoption information; and requiring the Office of Court Administration (OCA) to prepare the annual report on judicial efficiency. The bill's provisions relating to permanency planning for children in the managing conservatorship of PRS would have a significant fiscal impact. The bill would require the department to recommend to the court one of two alternatives after a child has been in conservatorship for one year: returning the child to the child's parents and dismissing the suit, or terminating parental rights and retaining conservatorship. The effective date for this provision would be September 1, 1997. The bill would require the court to select between the two alternatives when issuing an order at the first permanency hearing on or after the first anniversary of the child's placement in conservatorship. The effective date for this provision is September 1, 1998. Methodolgy It is assumed that these provisions would significantly increase the workload of the department's child protective services program and legal staff. The workload increase would be heaviest in fiscal year 1998, when the department would implement new permanency planning procedures and begin moving about 3,500 foster children who have been in conservatorship for 12 or more months through the court system in preparation for a final court order of reunification or termination. It is also assumed that the cost of the additional workload would be more than offset by a savings in foster care and other purchased service payments, because the provisions of the bill would cause children to leave the system more quickly due to reunification with their family or termination of parental rights and eventual adoption by another family. The Department of Protective and Regulatory Services estimates that 337 children in conservatorship would leave the foster care system during fiscal year 1998 due to implementation of the bill's provisions. The number of children leaving the system after 1998 would rise steadily, from 1,693 in 1999 to nearly 2,500 in the year 2001. This would result in a five-year savings of more than $110 million in foster care payments and $1.7 million in other purchased service payments. The department estimates that the number of children receiving adoption subsidy payments would increase by 150 due to implementation of the bill's provisions, and foster care savings have been adjusted for the increase in adoption subsidy payments. The department estimates that implementation of the bill's provisions would require additional child protective service workers and legal staff to handle the new permanency planning requirements. Staffing costs have been adjusted for a gradual implementation of the program in 1998. The cost estimate uses federal revenue from the Temporary Assistance for Needy Families (TANF) program. In the event that TANF funds are unavailable for allocation, General Revenue may need to be substituted. 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 Probable Probable Probable Change in Number Savings/(Cost) Savings/(Cost) Savings/(Cost) Savings/(Cost) of State from General from General from Federal Funds from Federal Funds Employees from Revenue Fund Revenue Fund FY 1997 0001 0001 0555 0555 1998 ($4,604,926) $3,156,825 ($3,417,593) $1,641,687 180.0 1998 (2,377,816) 14,503,081 (1,764,721) 7,542,235 90.0 2000 (2,476,691) 16,460,143 (1,838,101) 8,559,992 97.0 2001 (2,676,583) 18,764,019 (1,986,453) 9,758,108 103.0 2002 (2,778,174) 21,203,445 (2,061,850) 11,026,716 104.0 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 ($1,448,101) 1999 12,125,265 2000 13,983,452 2001 16,087,436 2002 18,425,271 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. Implementation of the bill's provisions would result in a significant additional cost for local government because many counties provide legal representation for children in the managing conservatorship of the Department of Protective and Regulatory Services. The department estimates that the additional workload would cause local governments to hire additional attorneys at a cost of $7 million statewide during the first two years of the bill's implementation. Source: Agencies: 501 Department of Health 530 Department of Protective and Regulatory Services 302 Office of the Attorney General LBB Staff: JK ,BB ,NM