LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
February 14, 1997
TO: Honorable Bill Ratliff, Chair IN RE: Senate Bill No. 310
Committee on Finance By: Brown
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on SB310 ( Relating
to certain judicial salaries.) this office has detemined the
following:
Biennial Net Impact to General Revenue Funds by SB310-As Introduced
Implementing the provisions of the bill would result in a net
negative impact of $(54,719,000) 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 establish $122,912 as the annual salary for a
justice on the Supreme Court. The bill would also amend Government
Code, Section 659.012 concerning the salary provisions for justices
of the courts of appeals and the district judges. The bill
would also eliminate county supplements to the salaries of court
of appeals justices and district court judges.
The bill
would also impact salaries of district attorneys and other prosecuting
attorneys performing the duties of district attorneys.
The
bill would repeal Chapter 31 of the Government Code concerning
supplemental compensation for justices of the courts of appeal
and Subchapter A, Chapter 32, Government Code, concerning supplemental
compensation for district judges.
The proposed salary changes
would impact the Employees Retirement Fund since benefits for
members of the elected class are based on the salary of a district
judge. The bill would impact the Judicial Retirement System,
Plan 2 (JRS2) requiring an increase of .56 on the current contribution
rate to remain actuarially sound. The bill would also require
an increase in the state's appropriations for benefits under
the Judicial Retirement System, Plan 1.
The bill would increase
the liabilities and the normal cost of the Employees Retirement
Fund as a result of the increase in benefits provided to members
of the elected class. Because of the large actuarial surplus
in that fund, an increase in state contributions to the program
would not be required. However, $.186 million in FY 98 and
$.201 million in FY 99, $.202 million in FY 2000, $.211 million
in 2001 and $.212 million in 2002 JRS2 would be needed in general
revenue to fund the increase to JRS2. $5.5 million in FY 98
and $5.9 million in FY 99, $6.3 million in FY2000, $6.7 million
in FY 2001, $7.2 million in FY 2002 for JRS 1 will be needed
in general revenue funding.
Methodolgy
The Comptroller of Public Accounts based calculations for salaries
on the statutory relationships established in the bill, raising
all Chief Justices, justices and judges of the appellate courts,
all district court judges salaries and prosecuting attorneys'
salaries. The proposed State salary changes are based on the
increase in the annual salary of a district judge from $85,217
to $110,621 annually. All current and future benefits for elected
class members will increase by 29.8%. Future Judicial Retirement
Systems Plan One and Plan Two (JRS1 and JRS2) benefits and member
contributions will increase by 29.8% as a result of the higher
salary levels. Benefits for current JRS1 annuitants will increase,
but benefits for current JRS2 annuitants will not change. The
Employees Retirement System based calculations on an estimated
increase in the normal cost of the Employees Retirement Fund
from 6.305% to 6.334%, an increase in the normal cost of the
Judicial Retirement Fund of .56 above the current contribution
rate; and an increase in benefits paid to JRS1 annuitants.
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 General
Revenue Fund
0001
1998 ($27,152,000)
1998 (27,567,000)
2000 (27,968,000)
2001 (28,377,000)
2002 (28,878,000)
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 ($27,152,000)
1999 (27,567,000)
2000 (27,968,000)
2001 (28,377,000)
2002 (28,878,000)
Similar annual fiscal implications would continue as long as
the provisions of the bill are in effect.
Savings for local governmental entities would be approximately
$3,034,000 annually because counties would no longer be paying
a supplement to district judges and appellate judges. However,
there would be some additional cost to the counties as a result
of any local judges salaries which are determined based on the
salary of a district judge.
Source: Agencies: 304 Comptroller of Public Accounts
212 Office of Court Administration
327 Employees Retirement System
201 Supreme Court of Texas
LBB Staff: JK ,RR ,DC