LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
April 18, 2001
TO: Honorable Teel Bivins, Chair, Senate Committee on
Education
FROM: John Keel, Director, Legislative Budget Board
IN RE: SB702 by West, Royce (Relating to compensatory,
intensive, and accelerated education in public schools.),
As Introduced
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* SB702, As Introduced: negative impact of $(4,612,000) 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:
****************************************************
* Fiscal Year Probable Net Positive/(Negative) *
* Impact to General Revenue Related *
* Funds *
* 2002 $(2,556,000) *
* 2003 (2,056,000) *
* 2004 (2,056,000) *
* 2005 (2,056,000) *
* 2006 (2,056,000) *
****************************************************
All Funds, Five-Year Impact:
**************************************************************************
*Fiscal Probable Probable Change in Number of *
* Year Savings/(Cost) from Savings/(Cost) from State Employees from *
* Foundation School General Revenue Fund FY 2001 *
* Fund 0001 *
* 0193 *
* 2002 $(2,000,000) $(556,000) 1.0 *
* 2003 (2,000,000) (56,000) 1.0 *
* 2004 (2,000,000) (56,000) 1.0 *
* 2005 (2,000,000) (56,000) 1.0 *
* 2006 (2,000,000) (56,000) 1.0 *
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Fiscal Analysis
The bill makes a number of substantive changes to sections of the Texas
Education Code relating to compensatory education, eligibility for high
school equivalency examinations, and agency and district data reporting.
Section 1 allows certain students currently enrolled in high school to
take the high school equivalency examination. Section 5 of the bill
directs the Texas Education Agency (TEA) to develop a high school
equivalency examination preparation course. Section 3 exempts from the
compulsory attendance rule 16 year olds who have earned a GED.
The bill re-focuses the compensatory education program in Section 4,
adding language to the statutory description of the compensatory
education program focusing on reducing disparity in student performance
and high school completion rates for those students at risk of dropping
out of school. The bill also amends the definition of an at risk student
.
The bill in Sections 6, 10 and 11 requires TEA to make the current agency
biennial report an annual report, and requires that additional data be
reported.
Section 7 changes the academic excellence indicators to add a
desegregation of data for at risk status and to add completion rates to
the data reported. Section 8 directs the commissioner to determine
performance levels of at risk students for AEIS rating levels, and
Section 9 includes at risk students as a category for reporting
performance information in each school district's annual performance
report.
Section 12 modifies the funding allotment for compensatory education by
permitting students in districts that do not participate in the national
school lunch program to generate funding. It also modifies the language
related to the use of the allotment.
Section 13 directs the commissioner to form a committee with specified
membership to study effective compensatory education and effective higher
education development programs.
The legislation takes effect immediately. Changes to the academic
excellence indicators and the district annual performance report take
effect for the 2002-03 school year. Most other provisions would
generally apply to the 2001-02 school year.
Methodology
Several sections of the bill have a fiscal impact.
The GED Testing Service has exempted Texas from general policy by
approving Texas to allow certain at-risk youth to prepare for and take
the GED tests provided there is state oversight of the programs. To
provide such required oversight, TEA estimates that one additional
full-time employee would be required to administer and provide oversight
to the program, as well as develop procedures to prevent students from
being channeled into the program for the wrong reasons, as directed by
the legislation.
The Section 12 provisions regarding participation in the federal free or
reduced price lunch program have a fiscal implication to the Foundation
School Program. The provision adds a population of students for
compensatory education funding purposes that are not currently counted.
TEA estimates that there are 81 school districts or open-enrollment
charter schools that do not participate in the national school lunch
program. For the 1999-2000 school year, there were 12,795 students
enrolled at those school districts and open-enrollment charter schools,
of whom 1,796 were reported as low-income. TEA estimates an average
compensatory education allotment for those schools is of $700 for
purposes of this estimate. In addition to the allotment amount, each
student would generate additional funding through the guaranteed yield
program, estimated at approximately $400. Assuming 1,796 students
generating an additional $1,100 in state aid, the impact would be
approximately $2.0 million in additional annual state costs. This
estimate will be impacted by the actual adopted language of the
commissioner's rule.
Section 13 involves the expenses related to evaluating the effectiveness
of programs. Because the programs offered in public school settings are
significantly different from those offered at the higher education
level, this requirement really involves two distinct studies. Because
of the one-time nature of this provision, it is expected that the most
economical method of handling the study requirement is to contract for
the evaluation. The expected cost of such contracts is estimated to be
at least $250,000 each.
Local Government Impact
School districts and open enrollment charter schools not participating in
the federal free or reduced price lunch program would benefit from the
$2 million in increased state aid. School districts in general may also
redirect compensatory education funds to target the defined population
in the legislation.
Source Agencies: 701 Texas Education Agency
LBB Staff: JK, CT, UP