LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 80TH LEGISLATIVE REGULAR SESSION
 
April 13, 2007

TO:
Honorable Warren Chisum, Chair, House Committee on Appropriations
 
FROM:
John S. O'Brien, Director, Legislative Budget Board
 
IN RE:
HB1319 by Villarreal (Relating to state financial assistance to school districts that make contributions for social security coverage.), As Introduced



Estimated Two-year Net Impact to General Revenue Related Funds for HB1319, As Introduced: a negative impact of ($144,699,429) through the biennium ending August 31, 2009.

The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.



Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2008 ($70,585,087)
2009 ($74,114,342)
2010 ($77,820,059)
2011 ($81,711,062)
2012 ($85,796,615)




Fiscal Year Probable Savings/(Cost) from
GENERAL REVENUE FUND
1
2008 ($70,585,087)
2009 ($74,114,342)
2010 ($77,820,059)
2011 ($81,711,062)
2012 ($85,796,615)

Fiscal Analysis

The bill would provide funding to school districts equal to the total cost to the school district of making contributions on behalf of employees to the federal social security system.  In order to be eligible for funding under the provisions of the bill, a school district must have covered employees under the social security system prior to January 1, 2007, and funding would apply only to classes of employees covered by the district under social security prior to January 1, 2007.

Methodology

According to the Texas Education Agency (TEA), fifty-five school districts would be eligible for funding under the provisions of the bill.  The estimated social security-related expenditures of those districts in the 2006-07 school year is $67.2 million.  Assuming 5 percent annual growth in social security-related expenditures, the estimated state cost of funding those costs would be $70.6 million in fiscal year 2008 and $74.1 million in fiscal year 2009. 

Local Government Impact

Eligible districts would receive additional state funding to offset local expenditures for social security.


Source Agencies:
701 Central Education Agency
LBB Staff:
JOB, CT, UP, JSc