TO: | Honorable Steve Ogden, Chair, Senate Committee on Finance |
FROM: | John S. O'Brien, Director, Legislative Budget Board |
IN RE: | SB607 by Uresti (Relating to enrollment requirements for the operation of Texas A&M University--San Antonio as a general academic teaching institution and the issuance of bonds for that institution.), As Introduced |
Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
---|---|
2010 | $0 |
2011 | ($3,487,382) |
2012 | ($3,487,382) |
2013 | ($3,487,382) |
2014 | ($3,487,382) |
Fiscal Year | Probable Savings/(Cost) from General Revenue Fund 1 |
---|---|
2010 | $0 |
2011 | ($3,487,382) |
2012 | ($3,487,382) |
2013 | ($3,487,382) |
2014 | ($3,487,382) |
Provisions of the bill would reduce the enrollment requirement from 1,500 to 1,000 full-time students for the Texas A&M University System to be authorized to issue $40 million in tuition revenue bonds for Texas A&M University - San Antonio. Provisions of the bill also remove the connection between the authority for Texas A&M University - San Antonio to operate as a general academic teaching institution and the issuance of tuition revenue bonds, and remove the date by which the enrollment threshold has to be met (January 1, 2010.) The most recent information that Texas A&M University System has provided indicates that it would issue bonds in the second year of the biennium.
The bonds would be payable from pledged revenue plus tuition. The bonds would not be general
obligations of the State. However, the issued bonds would have fiscal implications for the State.
Although tuition income is pledged against the bonds, historically the Legislature has appropriated
General Revenue to reimburse institutions for the tuition used to pay the debt service. For purposes of
this fiscal note it is assumed the bonds would be issued on September 1, 2010.
The debt service calculations were based on a six percent interest rate and a 20-year debt
service amortization. Based on these assumptions, the debt service calculation for for fiscal year 2011 is estimated to be $3,487,382.
Source Agencies: | 781 Higher Education Coordinating Board, 710 Texas A&M University System Administrative and General Offices
|
LBB Staff: | JOB, MN, RT, SSh, KK, ESi
|