LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
April 6, 1999
TO: Honorable Elliott Naishtat, Chair, House Committee on
Human Services
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB3639 by Naishtat (Relating to eligibility for and the
provision of services and programs for needy people and
to the duty of parents to support their children to
prevent reliance on programs for needy people; providing
penalties.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB3639, As Introduced: negative impact of $(19,043,922) through *
* the biennium ending August 31, 2001. *
* *
* The bill would make no appropriation but could provide the legal *
* basis for an appropriation of funds to implement the provisions of *
* the bill. *
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The bill would amend and add various sections to Chapter 31 of the Human
Resources Code dealing with financial assistance or the state-federal
Temporary Assistance for Needy Families (TANF) program.
General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2000 $(4,446,291) *
* 2001 (14,597,631) *
* 2002 (20,052,593) *
* 2003 (19,552,593) *
* 2004 (20,052,593) *
****************************************************
All Funds, Five-Year Impact:
***********************************************************************
*Fiscal Probable Probable Probable Probable Change in *
* Year (Cost) from Savings (Cost) from Savings Number of *
* Federal from General from State *
* Funds Federal Revenue General Employees *
* (TANF) Fund (TANF) Fund: Revenue from FY 1999 *
* 0555 0555 Medicaid Fund: *
* Match Medicaid *
* 0001 Match *
* 0001 *
* 2000 $5,112,194 $3,853,709 687.0 *
* $(104,881, $(8,300,000) *
* 417) *
* 2001 7,260,361 4,957,332 607.0 *
* (105,792, (19,554,963) *
* 623) *
* 2002 7,260,361 4,957,332 607.0 *
* (109,505, (25,009,925) *
* 723) *
* 2003 7,260,361 4,957,332 607.0 *
* (108,659, (24,509,925) *
* 110) *
* 2004 7,260,361 4,957,332 607.0 *
* (107,551, (25,009,925) *
* 546) *
***********************************************************************
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*Fiscal Probable (Cost) from Federal Probable Savings from Federal *
* Year Funds: Medicaid Funds: Medicaid *
* 0555 0555 *
* 2000 $(13,000,000) $5,134,027 *
* 2001 (30,598,788) 6,604,305 *
* 2002 (39,097,575) 6,604,305 *
* 2003 (38,297,575) 6,604,305 *
* 2004 (37,497,575) 6,604,305 *
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Technology Impact
The bill would require changes to the System for Verification,
Eligibility, Referral and Resources (SAVERR) which is not Year 2000
compliant. The Department of Human Services estimates that it would
require 16,150 programming hours at an estimated cost of $1.7 million to
complete the adjustments necessary to implement the provisions of the
bill.
Fiscal Analysis
The initial analysis of the fiscal implications of this bill have been
developed as separate components. Further analysis is required related
to the interactive effects of various provisions, differing responses
relating to child support provisions and the impact on the Texas Medicaid
program. In addition, the fiscal analysis was prepared without the
benefit of input from the Texas Workforce Commission.
Components of the bill with fiscal implications include:
Costs
1. The two-step sanction process which allows persons to continue grant
benefits if they have complied with personal responsibility agreement
requirements.
2. Additional child care services.
3. Earned Income Disregard. Increases both TANF related expenditures
and Medicaid benefits for the increased length of TANF eligibility.
4. Post-Employment Assessment. Estimates do not include costs at this
time. It is anticipated that additional costs would occur due to the
provisions of the bill.
5. Personal needs assessment and referral requirement are anticipated to
add additional responsibilities and staff at DHS.
6. Housing assistance provisions are assumed to require additional TANF
expenditures.
7. Child Support incentives and the distribution of child support
payments.
8. Increased grant amounts.
9. Eligibility for financial assistance from the date of application.
10. Income and resource requirements applicable to the Medicaid program.
It is possible that these provisions would have cost implications to the
Department of Health but are not included in these estimates.
Savings
1. Ineligibility for benefits due to certain drug-related convictions.
2. Work requirement exemptions provisions are anticipated to result in
savings due to an increased number of people reaching their time-limited
benefits period. (Savings for this component could be offset by
expenditures to provide employment training for clients no longer
exempted from time limits.)
Methodology
1. Two-step sanction would result in increased expenditures of
approximately $4 million per year.
2. Needs assessment would result in increased expenditures of
approximately $20 million per year, and an increase in FTE positions (700
in fiscal year 2000, and 630 in each subsequent year).
3. Felony drug conviction would result in savings to the TANF Grant
program and to the Medicaid program, and result in a reduction of about
20 FTE positions per year.
4. Child Care would result in increased expenditures of approximately
$13 million per year.
5. The Earned Income Disregard would result in increased expenditures
for the TANF Grant, totaling $10 million in fiscal year 2000, and $19
million in each subsequent year. Medicaid expenditures would also
increase by $11 million in 2001, and $21 million in each subsequent year.
6. Housing Assistance would result in increased expenditures of $25
million in 2000, declining to $18 million in 2004.
7. Transportation would result in increased expenditures of $2 million
per year.
8. Increased Supplemental Child Support Payments would result in a cost
ranging from $2 million to $9 million per year. This note assumes the
smaller cost.
9. Using the Federal Poverty Limit to determine TANF benefits would
result in increased expenditures of approximately $17 million per year.
This note assumes 17 percent of federal poverty.
10. Calculating benefits from the application date would result in
increased TANF expenditures $9 million in 2000, declining to $6 million
in 2004.
11. Changing the review process for Medicaid eligibility would result in
increased Medicaid expenditures of $21 million in 2000, and $40 million
in each subsequent year.
Local Government Impact
No significant fiscal implication to units of local government is
anticipated.
Source Agencies:
LBB Staff: JK, TP, PP, AZ