LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  May 25, 1997
         
         
      TO: Honorable Bob Bullock            IN RE:  Senate Bill No. 211, As Passed 2nd House
          Lieutenant Governor                Ellis
          Senate
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB211 ( relating 
to the establishment and operation of the Texas child care fund.) 
this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB211-As Passed 2nd House
         
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 amend the Labor Code to create the Texas Child 
Care Fund as a new, General Revenue-Dedicated account.  The 
fund could consist of donated funds for optimizing the amount 
of federal child care funds eligibility for the state.  These 
donated funds would have a positive effect on the state's cash 
flow.  None of the related agencies would incur significant 
administrative costs as a result of the creation of this fund.
 
Methodolgy
 
The amount of estimated donated funds from local entities was 
developed by the Office of the Comptroller of Public Accounts. 
 The bill specifies that the funding sources for the Texas Child 
Care Fund include state appropriations and money donated to 
the state by local governments, businesses, nonprofit organizations, 
or other persons for child care services.  School districts, 
local government and other non-profit and local entities currently 
donate $7 million for child care services in Texas.  It is estimated 
that the Texas Child Care Fund would raise an additional 50 
percent, or $3.5 million, for fiscal year 1998.  A 10 percent 
growth in donations is estimated for fiscal year 1999, and a 
20 percent growth rate in succeeding years.
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 Revenue   Probable           
            Gain/(Loss) from   Savings/(Cost)                                                             
            New GR-Dedicated   from Federal Funds                                                         
            Account -                                                                                     
            8021               0555                                                                        
       1998        $3,480,000        $5,959,000                                                      
       1998         3,828,000         6,554,000                                                      
       2000         4,594,000         7,865,000                                                      
       2001         5,512,000         9,438,000                                                      
       2002         6,615,000        11,326,000                                                      
 
 
         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.
          
The fiscal impact to local governments would be a corresponding 
gain in federal funds distributed by the state to the amounts 
donated into the Texas Child Care Fund.
          
   Source:            Agencies:   
                                         
                      LBB Staff:   JK ,TH