LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 9, 2001
TO: Honorable Dale B. Tillery, Chair, House Committee on
Pensions & Investments
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB1853 by Maxey (Relating to coverage for certain
dependent children under the Texas Employees Uniform
Group Insurance Benefits Act.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB1853, As Introduced: negative impact of $(4,761,530) 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. *
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General Revenue-Related Funds, Six-Year Impact:
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* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2001 $(420,850) *
* 2002 (2,037,860) *
* 2003 (2,302,820) *
* 2004 (2,602,190) *
* 2005 (2,940,470) *
* 2006 (3,322,730) *
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All Funds, Six-Year Impact:
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*Fiscal Probable Savings/(Cost) from Probable Savings/(Cost) from *
* Year Tobacco Settlement Receipts Other Funds *
* 5040 0997 *
* 2001 $(420,850) $(73,400) *
* 2002 (2,037,860) (331,740) *
* 2003 (2,302,820) (374,880) *
* 2004 (2,602,190) (423,610) *
* 2005 (2,940,470) (478,680) *
* 2006 (3,322,730) (540,910) *
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Fiscal Analysis
The bill would increase the employer contributions to fund the cost of
basic coverage for children eligible to participate in the State Kids
Insurance Program (SKIP). Currently, the state pays for 80% of the cost
of dependent child coverage in the Uniform Group Insurance Program
administered by the Employees Retirement System (ERS). The bill would
increase that contribution to 100%. The bill would be effective
immediately if it receives a vote of two-thirds of all the members
elected to each house or on September 1, 2001, if two-thirds votes are
not received.
Methodology
The current provisions of SKIP increased the state's dependent child
contribution from 50% of the cost to 80%. The estimated cost of the
current 30% additional contribution for fiscal year 2001 is $3,145,500.
Increasing the state's contribution rate to 100% for the final three
months of the fiscal year, assuming passage by two-thirds of the
Legislature, would cost an additional $524,250.
Costs in subsequent years reflect contributions for the full 12 months,
and an assume a growth rate of 13% annually, based on ERS projections of
health care cost increases. Currently 86% of SKIP expenditures are
funded with monies from the tobacco settlement, while the other 14%
comes from non-General Revenue-related funding sources.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 327 Employees Retirement System
LBB Staff: JK, RB, SC