LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  May 8, 1997
         
         
      TO: Honorable Irma Rangel, Chair            IN RE:  Senate Bill No. 572, Committee Report 2nd House, as amended
          Committee on Higher Education                              By: Fraser
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB572 ( Relating 
to the transfer of the University of Central Texas to the Texas 
A&M University System.) this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB572-Committee Report 2nd House, as amended
         
Implementing the provisions of the bill would result in a net 
negative impact of $(2,178,000) 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 authorize the transfer of The University of Central 
Texas to the Texas A&M University System or other university 
system, if both parties agree to the transfer and the Texas 
Higher Education Coordinating Board approves it.
 
Methodolgy
 
It is assumed that the University of Central Texas would become 
a component of the Texas A&M University System or other university 
system on September 1, 1998.

The University of Central Texas 
has enrolled approximately 500 students over the last three 
years.  It is assumed that 500 students who would have attended 
a private institution, would attend the new public university. 
 It is also assumed that the enrollment would increase.  However, 
it is assumed that the additional students would have attended 
other public universities and the increased enrollment would 
not significantly increase costs to the State.  The general 
revenue cost per full time student at a public university is 
$4,356.

The university currently leases about 30,000 square 
feet from Central Texas College.  It is assumed that the university 
would continue to lease space from Central Texas College and 
the costs of the lease would approximate the costs of providing 
maintenance, and utilities at other public university.

Additional 
costs may also be incurred for planning, faculty recruitment 
and program development.  Special item funding could be provided 
for these costs.

Salary information reported by Sul Ross 
- Rio Grande, a public upper-level institution with similar 
enrollment, was used to estimate the additional full-time equivalent 
employees.  The average salary reported by Sul Ross- Rio Grande 
in its Legislative Appropriation Request is $32,429.  Therefore, 
it is assumed that the additional full-time equivalent employees 
is equal to the estimated salaries expense divided by the average 
salary.
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           Change in Number   
            Savings/(Cost)     of State                                                                   
            from General       Employees from                                                             
            Revenue Fund       FY 1997                                                                    
            0001                                                                                           
       1998                $0               0.0                                                      
       1998       (2,178,000)              39.0                                                      
       2000       (2,178,000)              39.0                                                      
       2001       (2,178,000)              39.0                                                      
       2002       (2,178,000)              39.0                                                      
 
 
         Net Impact on General Revenue Related Funds:
 

 
              Fiscal Year      Probable Net Postive/(Negative)
                               General Revenue Related Funds
                                             Funds
               1998                   $0
               1999          (2,178,000)
               2000          (2,178,000)
               2001          (2,178,000)
               2002          (2,178,000)
 
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:   710   Texas A&M University System
                                         323   Teacher Retirement System and Optional Retirement Program
                                         781   Higher Education Coordinating Board
                                         
                      LBB Staff:   JK ,LP ,RR ,DB