LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              April 10, 2001
  
  
          TO:  Honorable Paul Sadler, Chair, House Committee on Public
               Education
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB3269  by McCall (Relating to the equalized wealth level
               under the public school finance system.), As Introduced
  
**************************************************************************
*  Estimated Two-year Net Impact to General Revenue Related Funds for    *
*  HB3269, As Introduced:  negative impact of $(1,263,000,000)           *
*  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                       $(631,000,000)  *
          *       2003                        (632,000,000)  *
          *       2004                        (636,000,000)  *
          *       2005                        (648,000,000)  *
          *       2006                        (710,000,000)  *
          ****************************************************
  
All Funds, Five-Year Impact:
  
         *****************************************************
         * Fiscal Year      Probable Savings/(Cost) from      *
         *                     Foundation School Fund         *
         *                              0193                  *
         *      2002                           $(631,000,000) *
         *      2003                            (632,000,000) *
         *      2004                            (636,000,000) *
         *      2005                            (648,000,000) *
         *      2006                            (710,000,000) *
         *****************************************************
  
Fiscal Analysis
  
The bill increases the Tier II guaranteed yield from $24.99 to $26.78 and
the equalized wealth level from $295,000 to $320,000.  The bill
increases the cost of the Foundation School Program both by increasing
the amount of state aid to which school districts are entitled and also
by increasing the Chapter 41 wealth threshold.
  
  
Methodology
  
The Texas Education Agency provided information indicating a net impact
to state aid of approximately $630 million in each year of the 2002-03
biennium.  The cost implications are reflected as increased demands on
Fund 193, Foundation School Fund.
  
  
Local Government Impact
  
Local school districts would realize increases in revenue available for
expenditure.
  
  
Source Agencies:   701   Texas Education Agency
LBB Staff:         JK, CT, UP