LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 76th Regular Session
May 4, 1999
TO: Honorable Sherri Greenberg, Chair, House Committee on
Pensions & Investments
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB1130 by Armbrister (Relating to programs and systems
administered by the Employees Retirement System of
Texas.), As Engrossed
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB1130, As Engrossed: negative impact of $(30,538,412) 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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General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2000 $(8,670,444) *
* 2001 (21,867,968) *
* 2002 0 *
* 2003 0 *
* 2004 0 *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Savings/(Cost) Savings/(Cost) Savings/(Cost) Savings/(Cost) *
* from General from All from Federal from Other *
* Revenue Fund GR-Dedicated Funds Funds *
* 0001 Accounts 0555 8042 *
* 8021 *
* 2000 $(8,670,444) $(361,925) $(1,934,357) $(1,455,446) *
* 2001 (21,867,968) (865,973) (3,502,618) (3,502,237) *
* 2002 0 0 0 0 *
* 2003 0 0 0 0 *
* 2004 0 0 0 0 *
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Fiscal Analysis
The provisions of the bill relating to improved retirement benefits for
Employees Retirement System (ERS) members would have an actuarial cost,
but no additional state contributions would be required.
There are also provisions in the bill affecting insurance programs
administered by the ERS. One provision would require that ERS estimate
the average expenditures from the state employee Uniform Group Insurance
Program anticipated for self-funded plans for a 60-day period during the
biennium. ERS would then be required to set aside this amount as a
contingency reserve for the program. Current statute requires a
contingency reserve equal to 10% of expected self-funded claims. The
60-day period required by this bill would be the equivalent of a 16%
reserve level.
Methodology
The committee substitute for House Bill 1, the general appropriations
bill, does not contain sufficient funding to achieve the reserve level
required by the bill. Additional funds, totalling $12.4 million in
fiscal year 2000 and $29.7 million in fiscal year 2001, would need to be
appropriated to ERS to meet the 60-day requirement.
If the appropriations for state employee health insurance are increased
to the amount included in the appropriations bill as introduced, then
there would be no fiscal implication from this provision.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies:
LBB Staff: JK, PE, WM