81(R) HB 2773 - Introduced version

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2010	($5,265,918)
2011	($10,253,523)
2012	($15,539,440)
2013	($20,465,357)
2014	($20,637,829)

Fiscal Year	Probable Savings/(Cost) from GENERAL REVENUE FUND 1
2010	($5,265,918)
2011	($10,253,523)
2012	($15,539,440)
2013	($20,465,357)
2014	($20,637,829)

Fiscal Year	Change in Number of State Employees from FY 2009
2010	1.0
2011	1.0
2012	1.0
2013	1.0
2014	1.0

Fiscal Analysis

The bill would create an undergraduate education scholarship program for students who agree to teach in public schools that have teacher shortages in mathematics and science. Under provisions of the bill, the Higher Education Coordinating Board would establish and administer a program to award scholarships, not to exceed the lesser of the total amount of tuition at a public or private institution for educator preparation programs or $5,000, to undergraduate students who are enrolled in educator preparation programs and agree to teach for a specified period in the public schools that are determined by the Texas Education Agency to have shortages of teachers in mathematics and science.

Under provisions of the bill, not more than 4,000 scholarships may be awarded in any one year, but for the 2010-11 academic year, not more than 1,000 scholarships may be awarded, for the 2011-12 academic year, not more than 2,000 scholarships may be awarded, and for the 2012-13 academic year, not more than 3,000 scholarships may be awarded. It is assumed the first scholarships would be awarded in fiscal year 2010.

The Coordinating Board would adopt rules to administer this subchapter and distribute to each educator preparation program of a public or private institution of higher education a copy of the rules adopted. In addition to money appropriated by the legislature, the board may solicit and accept grants, gifts, and donations from any public or private source for the purposes of this subchapter.

Methodology

For purposes of this fiscal note it is assumed that the Higher Education Coordinating Board will set up the program beginning in fiscal year 2010. It is also assumed the amount of the scholarship would be $5,000 and the number of scholarships awarded would be 1,000 in fiscal year 2010, 2,000 in fiscal year 2011, 3,000 in fiscal year 2012, and 4,000 in fiscal year 2014 and 2015 (the limits contained in the bill). These amounts could be less depending on the tuition and fees covered by the scholarhsips and how many students take advantage of the program.

The remaining costs include an account representative, one time technology costs for custom programming to add a new loan type with unique characteristic to the Higher Education Coordinating Board's student loan software system, and servicing costs based on 2% of the loan principal. For standard student loans, the majority of borrowers fulfill their agreements by repaying their loans on time and the servicing costs are mostly for producing and mailing monthly billing statements, processing payments, and maintaining the data base. However, additional servicing costs are incurred: (1) for the borrowers who need assistance in the form of special payment or deferment arrangements, (2) for loans that are delinquent, and (3) for loans that are in default. Loans with forgiveness provisions entail all of the above servicing costs, but unlike standard student loans, additional staff resources are spent tracking and reviewing documentation for what recipients are doing to fulfill the service obligation.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION


April 21, 2009

TO:	Honorable Dan Branch, Chair, House Committee on Higher Education

FROM:	John S. O'Brien, Director, Legislative Budget Board

IN RE:	HB2773 by Eissler (Relating to the Texas Teach Corps Scholarship Program for students who agree to teach in public schools in this state that have shortages of teachers in mathematics or science.), As Introduced