LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session May 19, 1997 TO: Honorable Irma Rangel, Chair IN RE: Senate Bill No. 1907, Committee Report 2nd House, Substituted Committee on Higher Education By: Bivins House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on SB1907 ( Relating to tuition and fees charged by public institutions of higher education, including the redesignation of certain fees as tuition.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by SB1907-Committee Report 2nd House, Substituted Implementing the provisions of the bill would result in a net impact of $0 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 amend the Education Code to reclassify the building use fee as tuition; would specify the maximum charges; and would exclude it from the Texas Public Education grants. The bill would exclude tuition above the minimum level from educational and general funds and would require that it is not accounted for in determining an institution's general revenue appropriation. The bill would increase the resident tuition at a law school from $75 per semester credit hour to $80 per semester credit hour and would set nonresident law tuition at the same amount that can be charged a nonresident graduate student. The bill would authorize a governing board to waive fees under certain circumstances including for students enrolled only in distance learning courses and for students that cannot reasonably be expected to use the services, provided that waiver of the fees will still enable the institution to provide the service or facility and meet any debt obligations. The bill would authorize governing boards to fix and collect rentals, rates, and charges from students and other for use of facilities. This revenue could be used towards paying bonds. The change to tuition would take effect for the 1997 fall semester. Methodolgy Because the bill reclassifies the building use fee as tuition but does not authorize an increase in the total tuition that an institution could charge as compared to the amount that an institution could previously have charged for tuition and building use fees, there would be no impact on the amount of designated funds for institutions of higher education. The bill would increase the amount of tuition charged at a law school by $5 per semester credit hour. The semester credit hours during the base period for law totaled 109,465. The increase in Other Educational and General Income (Other E&G) amounts are shown in the table below. This increase in Other E&G would result in a redistribution of general revenue from the law schools under the all funds methodology. The institutions with law schools are UT Austin, University of Houston, Texas Southern University, and Texas Tech University. It is assumed that the fee waivers for distance learning courses and for students that cannot use the facility or services would not have a significant fiscal impact on the institutions. 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 Revenue Gain/(Loss) from Other Educational and General Income/ GR-Dedicated 8022 1998 $547,325 1998 547,325 2000 547,325 2001 547,325 2002 547,325 Net Impact on General Revenue Related Funds: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $0 1999 0 2000 0 2001 0 2002 0 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 ,LD