LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
April 10, 2001
TO: Honorable Irma Rangel, Chair, House Committee on Higher
Education
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB2547 by Dutton (Relating to an exemption from or
refund of tuition and fees for certain lower-division
students enrolled at Texas Southern University and
Prairie View A&M University.), As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB2547, As Introduced: negative impact of $(7,226,119) 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, Five-Year Impact:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(2,773,674) *
* 2003 (4,452,445) *
* 2004 (4,674,275) *
* 2005 (4,820,049) *
* 2006 (4,820,049) *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Savings/(Cost) from Probable Revenue Gain/(Loss) *
* Year General Revenue Fund from Estimated Other *
* 0001 Educational and General Income *
* Account/ GR-Dedicated *
* 0770 *
* 2002 $(2,773,674) $(2,773,674) *
* 2003 (4,452,445) (4,452,445) *
* 2004 (4,674,275) (4,674,275) *
* 2005 (4,820,049) (4,820,049) *
* 2006 (4,820,049) (4,820,049) *
***************************************************************************
Fiscal Analysis
The bill provides an exemption from or refund of tuition and fees for
lower division students enrolled at Prairie View A&M (PVAMU) or Texas
Southern University (TSU). In order to be eligible, the student must
have graduated from a private high school, home school, or public high
school in Texas; be a Texas resident; and earn a minimum grade point
average (GPA) of 2.0 in the first semester. This exemption or refund may
extend into the first two academic years, if the student maintains that
2.0 GPA. The student must pass an examination before enrolling in the
third academic year. The university is not required to provide tuition
and fee refunds or exemptions beyond those funded through state
appropriations and may do so using local funds or funds appropriated to
the university.
This bill applies to tuition and fees beginning in Fall 2001 and expires
in fiscal year 2021.
Methodology
Based on analysis prepared by the Texas Higher Education Coordinating
Board (THECB), the number of eligible students for the first semester of
2002 at PVAMU and TSU is estimated to be 831 and 688, respectively. It
is assumed that all students who are retained from one semester to the
next would also have a minimum GPA of 2.0. The actual retention rates
for each institution were applied to calculate the number of eligible
student in future semesters. In addition, tuition is estimated to be
$1,120 per student and is increased by 5% each year.
The estimated loss of appropriated tuition revenue is $2,773,674 in
fiscal year 2002 and $4,452,445 in fiscal year 2003. It is assumed that
general revenue would be provided for the loss of tuition revenue. The
institutions would also realize a reduction in non-appropriated tuition
revenue. However, these amounts would not impact State appropriations.
If the tuition refunds and exemptions attract new students to the
institution who would not have otherwise attended a public institution,
the State would realize additional general revenue formula costs
beginning in fiscal year 2004.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 717 Texas Southern University, 715 Prairie View
A&M University, 781 Texas Higher Education
Coordinating Board
LBB Staff: JK, CT, DB