LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 76th Regular Session
  
                              March 30, 1999
  
  
          TO:  Honorable Judith Zaffirini, Chair, Senate Committee on
               Human Services
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB1158  by Carona (Relating to fraudulent conduct with
               respect to TANF benefits.), As Introduced
  
**************************************************************************
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  SB1158, As Introduced:  positive impact of $0 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                                   $0  *
          *       2001                                    0  *
          *       2002                                    0  *
          *       2003                                    0  *
          *       2004                                    0  *
          ****************************************************
  
All Funds, Five-Year Impact:
  
**************************************************************************
*Fiscal        Probable             Probable        Change in Number of  *
* Year    Savings/(Cost) from  Savings/(Cost) from State Employees from  *
*            Federal Funds        Federal Funds           FY 1999        *
*                0555                 0555                               *
*  2000                     $0           $(630,000)                  0.0 *
*  2001             13,205,203                    0               (18.7) *
*  2002             13,205,203                    0               (18.7) *
*  2003             13,205,203                    0               (18.7) *
*  2004             13,205,203                    0               (18.7) *
**************************************************************************
  
Technology Impact
  
The bill would require 6,000 hours of programming changes.  At a cost of
$105 per hour, the programming would cost $630,000.
  
  
Fiscal Analysis
  
The bill would add Section 31.017 to the Human Resources Code.  The bill
would require the Department of Human Services permanently to disqualify
an applicant for financial assistance who is found to have made a false
or misleading statement, or withheld or misrepresented information.

The bill would also require that a person who is permanently disqualified
from receiving financial assistance is also disqualified from receiving
medical assistance (Medicaid benefits).  This part of the bill could not
be implemented without a federal waiver and the fiscal impact is not
included in this estimate.
  
  
Methodology
  
Assumptions related to Temporary Assistance for Needy Families (TANF)
Grants:
1)  Approximately 5,600 TANF cases (Consisting of one parent and two
children) are denied benefits due to fraud each year.  Under current
statute, the case is denied for one year, after which the family may
reapply.
2)  The bill would require that the case is denied permanently.
3)  The maximum monthly grant for a family of three is $188.  Savings
would begin one year after implementation and total $12,633,600 per year.
4)  It is assumed the state would meet its maintenance of effort
requirement in order to secure the TANF block grant.  Therefore, any
savings would impact TANF federal funds.

Assumptions related to eligibility determination:
1)  One FTE position would be reduced for every 300 fewer recipients.
Annual savings per FTE position include salary of $24.000 and fringe
benefits which total 27.59 percent of salary.
2)  The Department of Human Services would reduce 18.7 FTE positions in
fiscal year 2001 (compared to 1999).  The same number would be reduced
each subsequent year.
3)  Savings would impact TANF federal funds.  TANF eligibility
determination is funded with TANF federal funds.
  
  
Local Government Impact
  
No fiscal implication to units of local government is anticipated.
  
  
Source Agencies:   
LBB Staff:         JK, TP, PP