LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
March 26, 2001
TO: Honorable Irma Rangel, Chair, House Committee on Higher
Education
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2521 by Wilson (Relating to the establishment of a
medical school at Prairie View A&M University.), As
Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2521, As Introduced: negative impact of $(18,442,270) through *
* the biennium ending August 31, 2003. *
**************************************************************************
Appropriations:
*****************************************************
* Fiscal Year Appropriation out of General *
* Revenue Fund *
* 0001 *
* 2002 $(8,286,760) *
* 2003 (10,155,510) *
*****************************************************
General Revenue-Related Funds, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(8,286,760) *
* 2003 (10,155,510) *
* 2004 (12,398,010) *
* 2005 (15,341,760) *
* 2006 (18,816,113) *
****************************************************
All Funds, Five-Year Impact:
*****************************************************
* Fiscal Year Probable Savings/(Cost) from *
* General Revenue Fund *
* 0001 *
* 2002 $(8,286,760) *
* 2003 (10,155,510) *
* 2004 (12,398,010) *
* 2005 (15,341,760) *
* 2006 (18,816,113) *
*****************************************************
Fiscal Analysis
The bill would establishes a medical school at Prairie View A&M
University. The Texas A&M University System Board of Regents may
prescribe courses leading to degrees customarily offered by medical
schools, and adopt rules on the school's operation and enrollment.
This bill takes effect September 1, 2001. The medical school shall be
established not later than the 2003-2004 academic year.
Methodology
Based on analysis by the Texas Higher Education Coordinating Board, it is
assumed that:
(1) implementation of the bill would be made with moderate costs and
maximum use of existing resources and in-kind contributions from clinical
partner(s); and,
(2) the medical school would offer only the four-year doctor of medicine
degree in its first ten years of operation.
The analysis also assumes that the medical school would require the
construction of two new buildings -- a medical library and a medical
education building --located on or adjacent to the Prairie View A&M
University campus with land purchased by the University and financed by
tuition revenue bonds. The estimated cost of construction for a 84,200
square foot library would be $8.2 million and for a 281,300 square foot
medical education building would be $70.3 million. Facility space
requirements are based on existing medical education facilities at Texas
A&M University System Health Science Center (College Station and Temple
sites). Combined debt service for the two buildings of $6,791,760
annually would be based on an assumed bond rate of six percent per year,
beginning in fiscal year 2002, for 20 years. Both buildings would be
completed and ready for occupancy in March 2006.
All other estimates of the number of full-time employees and of the costs
of personnel, equipment, instruction and other operating expenses are
based on the program development, timeline and expenditure histories of
the medical school at Texas A&M University System Health Science Center
and the University of Texas System's proposal for a regional academic
health center in the Lower Rio Grande Valley.
It is assumed that the university would initially receive $4,858,750 in
special item funding for the 2002-03 biennium to begin the curriculum
design and accreditation process and to hire key personnel. Start-up
funds would increase as new personnel are hired, the buildings are
completed and equipped, library materials are purchased, and each class
of 65 students is admitted, beginning in fall 2006.
Based on this timeline, the school would be eligible to start receiving
instruction & operations and infrastructure formula funding in fiscal
year 2008, but it is assumed that the school would continue to receive
special item funding through fiscal year 2011.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 781 Texas Higher Education Coordinating Board
LBB Staff: JK, CT, DB, HM