Austin, Texas
                    FISCAL NOTE, 76th Regular Session
                               May 12, 1999
          TO:  Honorable Paul Sadler, Chair, House Committee on Public
        FROM:  John Keel, Director, Legislative Budget Board
       IN RE:  SB103  by Bivins (relating to state assessments of public
               school students), Committee Report 2nd House, Substituted
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  SB103, Committee Report 2nd House, Substituted:  positive impact      *
*  of $3,145,500 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.                                                             *
General Revenue-Related Funds, Five-Year Impact:
          *  Fiscal Year  Probable Net Positive/(Negative)   *
          *               Impact to General Revenue Related  *
          *                             Funds                *
          *       2000                           $1,422,750  *
          *       2001                            1,722,750  *
          *       2002                            3,277,000  *
          *       2003                            3,861,900  *
          *       2004                            3,940,000  *
All Funds, Five-Year Impact:
*Fiscal    Probable Savings/(Cost) from    Probable Savings/(Cost) from   *
* Year        Foundation School Fund           General Revenue Fund       *
*                      0193                            0001               *
*  2000                        $1,700,000                      $(277,250) *
*  2001                         2,000,000                       (277,250) *
*  2002                         3,540,000                       (263,000) *
*  2003                         4,040,000                       (178,100) *
*  2004                         4,040,000                       (100,000) *
Fiscal Analysis
The bill would expand the state assessment system to include new math
tests for grades 9 and 10 and new reading tests for grade 9.  Under the
guidelines of the bill, science assessments would be administered in
grade 10, social studies assessments would be administered in grades 8
and 10, and writing assessments would be administered in grades 4 and 7.
The bill would add an English language arts assessment for grade 10 and
require the availability of special education alternative assessments in
grades 9 and 10.

The bill would replace end-of-course assessments with 11th grade exit
tests in social studies, science, English language arts, and math.
Students who could not pass these tests would not be awarded high school
diplomas.  The bill would also allow TASP exemption for students whose
exit level assessment performance met guidelines to be established by the
Higher Education Coordinating Board.

The bill would require the agency to include new assessment results and
special education alternative testing performance in the accountability
ratings system no later than fiscal year 2007.

The bill as substituted would also require the commissioner to evaluate
the effectiveness of the tests described in Subchapter B, Chapter 39 of
the Texas Education Code.

The bill would replace the current academic excellence indicator related
to end-of-course exams with a measure of the 'numerical progress'
demonstrated by students who have failed previous TAAS administrations.

The bill would require the Texas Education Agency (TEA) to develop
assessment standards for the projects of gifted and talented students at
the exit-level and in grades 4 and 8.
According to the TEA, the implementation of new assessments called for in
Senate Bill 103 would cost $9.25 million in the 2000-2001 biennium.  The
costs would be for test development and administration, and would be
funded from a set aside out of the compensatory education allotment.  The
amount set aside from the allotment in fiscal year 2000 would be $4.25
million, rising to $5 million in fiscal year 2001.

Due to reduction in the compensatory education allotment, the bill would
create a net savings for the state through lowered Tier II state aid.
The net savings to the state would be $1.7 million in fiscal year 2000
and $2 million in fiscal year 2001.

Assessment costs, and thus state savings, would rise as new tests leave
development and enter administration during the next five years.  Due to
the increased cost associated with administration, the state would save
$3.54 million in Tier II state aid during fiscal year 2002, ultimately
rising to $4.04 million in fiscal year 2003.

TEA estimates that evaluation of test effectiveness would cost $100,000
beginning in fiscal year 2004.

The agency estimates that the development of assessment standards for the
projects of gifted and talented students would cost $554,000 in the
2000-2001 biennium, $263,000 in fiscal year 2002, and $178,100 in fiscal
year 2003.
Local Government Impact
Local school districts that receive compensatory education funds would
see a slight reduction in their allotment because of the funds set aside
for assessment design and administration.

TEA estimates that the expansion of the Academic Excellence Indicator
system called for in the bill would increase district costs associated
with performance reporting.
Source Agencies:   701   Texas Education Agency - Administration
LBB Staff:         JK, CT, CW