LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              April 25, 2001
  
  
          TO:  Honorable Irma Rangel, Chair, House Committee on Higher
               Education
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB555  by Ellis, Rodney (Relating to a college savings
               plan for qualified higher education expenses.), Committee
               Report 2nd House, Substituted
  
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*  No fiscal implication to the State is anticipated.                    *
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The bill establishes a higher education savings plan which would enable
individuals to save money for qualified higher education expenses by
establishing a savings trust account in the plan.  The bill would require
the Prepaid Higher Education Tuition Board to develop and implement a
plan, to select the financial institution or institutions to serve as
plan manager, to adopt rules governing withdrawal of money from a savings
trust account, and to develop policies and penalties for non-qualified
withdrawals.

The bill would rename the Texas Tomorrow Fund as the Texas Tomorrow
Constitutional Trust Fund.  The renamed fund would no longer be held
outside of the State Treasury and would become a trust fund held with the
Comptroller.  The bill would create the Texas College Savings Plan
Account within the Texas Tomorrow Constitutional Trust Fund, and the new
account would be financed through administrative fees and service
charges.  No additional state appropriations would be required to
implement the provisions of the bill.
 
The bill would implement recommendation ED-12 in the Comptroller's
report, e-Texas:  Smaller, Smarter, Faster Government.
  
Local Government Impact
  
No fiscal implication to units of local government is anticipated.
  
  
Source Agencies:   781   Texas Higher Education Coordinating Board, 304
                   Comptroller of Public Accounts
LBB Staff:         JK, CT, KC