| TO: | Honorable Frank Corte, Jr., Chair, House Committee on Defense Affairs & State-Federal Relations |
| FROM: | John S. O'Brien, Director, Legislative Budget Board |
| IN RE: | HB2055 by Cook, Robby (Relating to a tuition and fee exemption available to the dependents of certain military personnel.), As Introduced |
The bill would modify the residency requirements for tuition and fee exemptions for dependents of certain military personnel. Texas Education Code 54.203 (b) currently provides the same benefit to the children of persons killed in action, who died in the service, who are missing in action or who die as a result of illness or injury related to service. Therefore, the additional costs of this exemption will all be caused by creating an exemption for the children of totally disabled veterans and for creating an exemption for the spouse of deceased or disabled veterans.
In fiscal year 2006 the average value of a Hazlewood exemption was $1,913. The Veterans Administration that there are 17,564 veterans in Texas at this time who are classified as 100% disabled. To calculate the costs of making the children of disabled veterans eligible, the Higher Educaiton Coordinating Board assumed 50 percent of the disabled veterans in Texas would meet Hazlewood eligiblity requirements and 20% would have one child of college age. They also assumed that 15 percent of the children of college age would be enrolled and eligible for Hazlewood benefits and that the availability of the state exemption will cause the number of students using the exemption to increase by 4% per year. These assumptions indicate that in fiscal year 2008 there would be 263 students eligible for the benefit, rising to 308 students in fiscal year 2012. At $1,913 per student these exemptions would represent lost tuition and fee revenues for the institutions ranging from $504,000 in FY08 to $590,000 in fiscal year 2012.
To calculate the costs of making the spouses of deceased or disabled veterans eligible, the Coordinating Board assumed the number of deceased veterans since the end of the Korean War at least equalled the number of disabled veterans. They further assumed 50 percent of them would meet Hazlewood eligiblity requirements and 52.8% would be married (based on US Census Bureau data) and that 5 percent of the spouses would be eligible for Hazlewood benefits and also assumed that the availability of the state exemption will cause the number of spouses using the exemption to increase by 3% per year. These assumptions indicate that in fiscal year 2008 there would be 464 spouses eligible for the benefit, rising to 522 students in fiscal year 2012. At $1,913 per student these exemptions would represent lost tuition and fee revenues for the institutions ranging from $887,000 in fiscal year 2008 to $998,000 in fiscal year 2012.
The total costs to the institutions of higher education for both the children and the spouses are expected to equal $1,391,037 in fiscal year 2008, $1,437,808 in fiscal year 2009, $1,486,184 in fiscal year 2010, $1,536,221 in fiscal year 2011, and $1,587,977 in fiscal year 2012. It is assumed the cost will be absorbed by the institutions of higher education since the bill does not require the State to reimburse the institutions.
| Source Agencies: | 781 Higher Education Coordinating Board
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| LBB Staff: | JOB, ES, RT, GO
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