LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  April 1, 1997
         
         
      TO: Honorable Teel Bivins, Chair            IN RE:  Senate Bill No. 1893
          Committee on Education                              By: Bivins
          Senate
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on SB1893 ( Relating 
to the length of school year.) this office has detemined the 
following:
         
         Biennial Net Impact to General Revenue Funds by SB1893-As Introduced
         
The bill could result in a savings to General Revenue from a 
reduction of anticipated Teacher Retirement System liability 
of as much as $28,800,000 for the 1998-1999 biennium. 
         
The bill would make no appropriation but could provide the legal 
basis for an appropriation of funds to implement the provisions 
of the bill.

The bill would amend the section of the Texas 
Education Code related to the minimum number of days for teacher 
service.  Under current law, "R1" is the average Foundation 
School Program (FSP) allotment per student in average daily 
attendance (ADA) and "R2" is the FSP allotment per ADA for the 
1994-95 school year.  This fiscal note assumes that the change 
made to the variable "R1" was meant for "R2", so that the amended 
law will read:

"R2  is equal to FSP/ADA as determined under 
Section 21.402 for the 1996-1997 school year".

The daily 
rate of pay for teachers was estimated by summing base pay of 
teachers in 1997 ($8.2 billion) and dividing by 1997 FTEs (253,000) 
and days of employment (185).

Under current law, the minimum 
days of service for teachers would increase by an estimated 
7 days from 1997 to 1998.  The bill would reduce this number 
to 2 days.  

While current law does not require districts 
to increase teacher pay proportionally for an increase in the 
minimum days of service, districts may increase teacher pay 
if the number of required working days increases.  The proportional 
cost of a seven day increase is $310 million, whereas a two 
day increase would cost only $88 million.  As a result, anticipated 
Teacher Retirement System liability might be reduced by $14.4 
million per year as a result of this bill.  The difference in 
minimum days of services between 1998 and 1999 is 5 days.
         
 
          
The bill would reduce the expected minimum days of service by 
5 days in both 1998 and 1999.  Because districts receive no 
state funds based on the minimum service days, any increase 
to teacher salaries would be the responsibility of the local 
district. The daily rate of pay statewide for 1997 was $44.3 
million.  If districts increase minimum service days by 2 instead 
of 7 for 1998, the potential savings is estimated to be $221.6 
million.  The potential savings is likely to be the same for 
1999.

          
   Source:            Agencies:   701   Texas Education Agency - Administration
                                         
                      LBB Staff:   JK ,LP ,DH