LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
March 26, 1997
TO: Honorable Teel Bivins, Chair IN RE: Senate Bill No. 1577
Committee on Education By: Bivins
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on SB1577 ( Relating
to public postsecondary technical and vocational education,
to the programs, operation and administration of the Texas State
Technical College System.) this office has detemined the following:
Biennial Net Impact to General Revenue Funds by SB1577-As Introduced
Implementing the provisions of the bill would result in a net
negative impact of $(50,070,000) 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
This bill would (1) define the mission of TSTC; (2) designate
the Marshall Extension Center as a campus; (3) allow the transfer
of the extension centers in Abilene, Breckenridge and Brownwood
to nearby community colleges; (4) direct the Coordinating Board
to modify funding formulas to cover the special costs associated
with highly specialized advanced and emerging technical or vocational
programs; and (5) direct the Coordinating Board to establish
a grants program to assist a public technical institute or junior
college to cover the costs for the start-up or expansion of
programs in a highly specialized advanced or emerging technical
field.
Methodolgy
This bill would limit TSTC to offering only those academic courses
required for accreditation. There would be no fiscal impact
to the state because academic courses not offered by TSTC would
be offered by a nearby community college. Funding based on
contact hours would be appropriated to whichever institution
was offering the course.
In designating the Marshall Extension
Center as a campus, the TSTC System estimates that the addition
of 1 FTE would be needed to administer student financial aid
at a cost of 35,000 each year.
The transfer of the extension
centers in the bill is not mandatory. If the transfers did
occur, there could be cost savings associated with transferring
the physical plant costs to either the community college or
to the corporation authorized under Sections 10, 11 and 12 of
this bill.
It is assumed that the Marshall campus, including
the three buildings currently used on that campus, would be
transferred at no cost and with no debt to the TSTC System.
It is assumed that the mission of that campus would not be
significantly expanded and there will be no need for additional
facilities in the near future. It is assumed that while there
may be some shift of student enrollments, the net cost to the
state of enrollment changes will be zero. Costs for maintenance,
operations and utilities are included in the proposed 1998-99
appropriations bill and there would be no additional costs due
to this bill.
The bill would direct the Higher Education
Coordinating Board to modify the funding formulas to provide
a higher level of funding for highly specialized advanced and
emerging technologies. The level of funding provided to support
this provision would be dependent upon legislative action.
It is estimated that $12.5 million per year would support this
initiative.
The bill would also establish a grant program
to be administered by the Higher Education Coordinating Board.
Again, the level of funding provided to support this provision
would be dependent upon legislative action. It is estimated
that $12.5 million per year would support this initiative.
Costs for the Coordinating Board to administer the grant program
could be funded from these amounts.
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 ($25,035,000) 1.0
1998 (25,035,000) 1.0
2000 (25,035,000) 1.0
2001 (25,035,000) 1.0
2002 (25,035,000) 1.0
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
Funds
1998 ($25,035,000)
1999 (25,035,000)
2000 (25,035,000)
2001 (25,035,000)
2002 (25,035,000)
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:
LBB Staff: JK ,LP ,DB