Austin, Texas
                                   FISCAL NOTE
                               75th Regular Session
                                  April 10, 1997
      TO: Honorable Bill Ratliff, Chair            IN RE:  Senate Bill No. 591
          Committee on Finance                              By: Gallegos
          Austin, Texas
         FROM:  John Keel, Director    
In response to your request for a Fiscal Note on SB591 ( Relating 
to courses and programs at the University of Houston Downtown.) 
this office has detemined the following:
         Biennial Net Impact to General Revenue Funds by SB591-As Introduced   FN Revision 1
No fiscal impact to the State is anticipated during the biennium 
ending August 31, 1999.  However, the State would realize general 
revenue costs as the students begin to enroll in fiscal year 
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 University of Houston - Downtown 
to offer graduate programs.  The University of Houston - Downtown 
will not enroll students prior to fiscal year 2000.  Therefore, 
no fiscal impact to the State is anticipated during the biennium 
ending August 31, 1999.  
It is assumed the first graduate classes will start in Fall 
1999.  The estimated increases in full-time student equivalents 
are 60 students in FY 2000, 120 students in FY 2001, and 200 
students in FY 2002.  The average general revenue cost for a 
student attending graduate programs at a public university is 

It is assumed that approximately fifty percent of 
the additional students have not attended graduate programs 
at another public higher education institution.  The remaining 
fifty percent would have attended another graduate program at 
a public university in the Houston area, and would not result 
in additional costs to the State.

The increase in the number 
of students attending the University of Houston Downtown could 
create a need for additional buildings, capital equipment, and 
library materials.  However, these costs are eligible for support 
through Higher Education Funds allocations, and no general revenue 
costs are included.  

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

average salary reported by the University of Houston - Downtown 
in its Legislative Appropriation Request is $31,623.  Therefore, 
it is assumed that the additional full-time equivalent employees 
is equal to the estimated increase in 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                                                                    
       1998                $0               0.0                                                      
       1998                 0               0.0                                                      
       2000         (163,350)               5.0                                                      
       2001         (326,700)              10.0                                                      
       2002         (544,500)              16.0                                                      
         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
               1998                   $0
               1999                    0
               2000            (163,350)
               2001            (326,700)
               2002            (544,500)
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:   783   University of Houston System Administration
                                         781   Higher Education Coordinating Board
                      LBB Staff:   JK ,LP ,DB