LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 77th Regular Session January 30, 2001 TO: Honorable Robert Junell, Chair, House Committee on Appropriations FROM: John Keel, Director, Legislative Budget Board IN RE: HB253 by Longoria (Relating to benefits paid to survivors of certain law enforcement officers, firefighters, and other public servants.), As Introduced ************************************************************************** * Estimated Two-year Net Impact to General Revenue Related Funds for * * HB253, As Introduced: negative impact of $(4,088,079) through the * * biennium ending August 31, 2003. * * * * 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 * * 2002 $(2,041,442) * * 2003 (2,046,637) * * 2004 (2,060,026) * * 2005 (2,065,221) * * 2006 (2,078,610) * **************************************************** All Funds, Five-Year Impact: ***************************************************** * Fiscal Year Probable Savings/(Cost) from * * General Revenue Fund * * 0001 * * 2002 $(2,041,442) * * 2003 (2,046,637) * * 2004 (2,060,026) * * 2005 (2,065,221) * * 2006 (2,078,610) * ***************************************************** Fiscal Analysis The bill would increase the benefits paid to survivors of law enforcement officers, fire fighters, and other public safety personnel killed in the line of duty. The lump sum benefit paid to a surviving spouse or dependent parent would increase from $50,000 to $250,000. The bill increases the monthly benefit paid to a surviving minor child from $200 to $500, and extends the payments to age 21, or until the child receives a bachelor's degree or 200 hours of course work from an institution of higher education. The benefit paid to a surviving dependent sibling would change from a monthly benefit of $200 to a lump sum of $250,000. The bill exempts a surviving spouse or minor child who enrolls in an institution of higher education from tuition and fees at that institution, from the cost of housing and food at that institution, and pays to the student the cost of the student's books. Only survivors of public safety personnel killed after September 1, 2001 would be eligible for the increased benefits. Methodology The increase in the payments to surviving spouses/dependent parents would cost an additional $2,000,000 per year from the state's General Revenue Fund. This estimate assumes that benefits are paid to 10 surviving spouses/parents a year, based on the average for 1994-2000. No fiscal implication is estimated for lump sum payments to dependent siblings because no sibling benefits have been paid in the last sixteen years. Payments to surviving children would increase by 150 percent, from a current average of $2,078 to $5,195 per child per year. Based on the age distribution of current beneficiaries, ERS estimates that each year 9 children will receive benefits at the higher level, for an annual cost of $28,053. In addition, the extension of benefits to children older than 18 years of age would result in additional payments of $5,195 in fiscal year 2002 increasing to $25,975 in fiscal year 2006 as more older children are receiving the extended benefits. Based on ERS information on the ages of children receiving benefits under the program, it is estimated that in the first year of the bill, 1 dependent child will receive free tuition, fees, books, and room and board at a public university. One additional child will be eligible every other year, with 3 children eligible by fiscal year 2006. According to the Higher Education Coordinating Board, the average cost per student for these expenses is $8,194 per year at a public university. The resulting cost to the institutions is estimated at $8,194 in fiscal year 2002, increasing to $24,582 in fiscal year 2006. Local Government Impact According to the Higher Education Coordinating Board, the average per student cost for tuition, fees, books, and room and board at a community college is $5,728 per year. Each year an additional one or two children will be eligible to receive the increased benefits and may choose to attend a community college. Source Agencies: 781 Texas Higher Education Coordinating Board, 327 Employees Retirement System LBB Staff: JK, SD, RB, SC