LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 14, 2001
TO: Honorable Dale B. Tillery, Chair, House Committee on
Pensions & Investments
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB273 by Armbrister (relating to the systems and
programs administered by the Teacher Retirement System of
Texas; providing a penalty.), Committee Report 2nd
House, Substituted
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB273, Committee Report 2nd House, Substituted: positive impact *
* of $0 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 $0 *
* 2003 0 *
* 2004 0 *
* 2005 0 *
* 2006 0 *
****************************************************
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Revenue Change in Number of *
* Year Savings/(Cost) from Gain/(Loss) from New State Employees from *
* New 403(b) 403(b) FY 2001 *
* Administrative Trust Administrative Trust *
* Fund Fund *
* 2002 $(150,000) $150,000 2.0 *
* 2003 (125,000) 125,000 2.0 *
* 2004 (125,000) 125,000 2.0 *
* 2005 (125,000) 125,000 2.0 *
* 2006 (125,000) 125,000 2.0 *
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Fiscal Analysis
The bill, as substituted, 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 $150,000 in fiscal year 2002, and $125,000 in subsequent
years. It is assumed that 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