LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 26, 2001
TO: Honorable Bill Ratliff, Lieutenant Governor
Honorable James E. "Pete" Laney, Speaker of the House
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB273 by Armbrister (relating to systems and programs
administered by the Teacher Retirement System of Texas;
providing a penalty.), Conference Committee Report
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB273, Conference Committee Report: negative impact of $(90,000) *
* 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. *
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General Revenue-Related Funds, Five-Year Impact:
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* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(90,000) *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
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All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Change in *
* Year Savings/(Cost) Savings/(Cost) Revenue Number of State *
* from General from New 403(b) Gain/(Loss) Employees from *
* Revenue Fund Administrative from New 403(b) FY 2001 *
* 0001 Trust Fund Administrative *
* Trust Fund *
* 2002 $(90,000) $0 $0 2.0 *
* 2003 0 (125,000) 125,000 2.0 *
* 2004 0 (125,000) 125,000 2.0 *
* 2005 0 (125,000) 125,000 2.0 *
* 2006 0 (125,000) 125,000 2.0 *
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Fiscal Analysis
The bill, as reported by the conference committee, would make various
changes to the retirement programs administered by the Teacher
Retirement System (TRS). The provisions with a direct fiscal impact
relate to new responsibilities given to TRS to certify 403(b) investment
products offered to school district employees. TRS would be responsible
for certifying the investment and annuity products before they could be
marketed to school district employees. The bill would create a new
account in the state treasury, the 403(b) Administrative Trust Fund, and
allows TRS to charge a fee, not to exceed $5,000, to companies seeking
certification. Revenues from the fee would be deposited into the new
account, and used to pay for the costs of the new program.
Methodology
It is estimated that 2 additional full-time-equivalent employees will be
needed by TRS to perform the new duties. The associated cost is
estimated to be $90,000 in fiscal year 2002, and $125,000 in subsequent
years. TRS projects that for fiscal year 2002, general revenue funds
will be needed to pay for the initial design and start-up of the
certification program since the certification fee won't be collected
until TRS actually begins to certify companies. In subsequent fiscal
years, TRS will set a fee sufficient to cover the costs of the program.
Local Government Impact
No significant fiscal implication to units of local government is
anticipated.
Source Agencies: 323 Teacher Retirement System
LBB Staff: JK, RB, SC