LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  May 12, 1997
         
         
      TO: Honorable Irma Rangel, Chair            IN RE:  Senate Bill No. 576, As Engrossed
          Committee on Higher Education                              By: Sibley/et al.
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB576 ( Relating 
to the establishment of the Texas New Horizons Scholarship Trust 
Fund.) this office has detemined the following:
         
         Biennial Net Impact to General Revenue Funds by SB576-As Engrossed
         
No fiscal implication to the State is anticipated.
         

         
 
The bill would amend Subchapter D, Chapter 54 of the Education 
Code to establish the Texas New Horizons Scholarship Fund and 
would require the Texas Higher Education Coordinating Board 
to issue Texas New Horizons Scholarships to qualified high school 
graduates based on certain educational and economic criteria. 
 

The bill would create a new special fund, the New Horizons 
Scholarship Trust Fund, outside the treasury but in trust of 
the Comptroller.  Money in the fund could be spent without appropriation 
but only to fund the scholarship program.  Interest and income 
to the fund would be deposited in the fund.  The Coordinating 
Board would be authorized to accept gifts and grants from any 
public or private sources.  The bill would authorize the Coordinating 
Board to spend up to 2.5 percent of the deposits into the fund 
for administrative costs.

This bill would require that any 
amount of money delivered to the Comptroller by all local telephone 
exchange companies in excess of $2 million in any state fiscal 
year would be deposited to the Texas New Horizons Scholarship 
Trust Fund.  Money would no longer be subject to voluntary delivery 
to a rural scholarship fund.  The local telephone exchange companies 
would file with the Comptroller verification of the amount of 
money delivered.  The bill would repeal Section 74.3012 of the 
Property Code, relating to delivery of money to urban scholarship 
funds.

Under current law, deposits to rural/urban scholarship 
funds are capped at $800,000 per year.  In 1996, telephone exchange 
companies deposited $800,000 in these funds and the balance, 
approximately $2 million, to the credit of the General Revenue 
Fund 0001.  Based on the 1996 experience, this bill would have 
no fiscal impact on the General Revenue Fund.

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:   304   Comptroller of Public Accounts
                                         
                      LBB Staff:   JK ,LP ,LD