| TO: | Honorable Florence Shapiro, Chair, Senate Committee on Education |
| FROM: | John S O'Brien, Director, Legislative Budget Board |
| IN RE: | SB1871 by Davis (Relating to a contracted services program for certain students with a severe pervasive developmental disorder or a severe intellectual disability. ), Committee Report 1st House, Substituted |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2012 | $0 |
| 2013 | ($1,966,506) |
| 2014 | ($3,192,162) |
| 2015 | ($4,659,417) |
| 2016 | ($6,126,671) |
| Fiscal Year | Probable Savings/(Cost) from Foundation School Fund 193 |
Change in Number of State Employees from FY 2011 |
|---|---|---|
| 2012 | $0 | 0.0 |
| 2013 | ($1,966,506) | 3.0 |
| 2014 | ($3,192,162) | 3.0 |
| 2015 | ($4,659,417) | 3.0 |
| 2016 | ($6,126,671) | 3.0 |
The bill would create a contracted services program under which children with pervasive developmental disorders could be served by nongovernmental community-based educational establishments. The bill would include an eligible student attending a school district where they do not reside in the average daily attendance of the attending district if the state aid received by that district would be greater than if the student's district of residence were to transfer funds for the student. Services provided would be financed using state resources determined in the same manner as Foundation School Program state aid is determined for an open enrollment charter school, multiplied by 1.1. The bill allows the commissioner of education to withhold a portion of funding for a qualifying institution as required to pay the cost of administering the program. The commissioner would be required to designate an impartial organization to conduct annual evaluations of the program, subject to available financial resources.
The provisions of the bill would have fiscal impact for the Foundation School Program (FSP) to the extent that students with pervasive development disorder not currently eligible for FSP funding would receive services from qualifying community institutions claiming funding on their behalf. The bill would also have fiscal implications for the operations of the Texas Education Agency (TEA).
In 2010–2011, there were 34,987 students enrolled in Texas public schools who were identified as having autism. Of these, 34,558 students were eligible for FSP funding and the remaining 429 students were reported not eligible. In general, the primary reason for an enrolled student to not be eligible for FSP funding is that the student is served for fewer than a minimum number of hours each day.
The TEA conservatively estimates that it would receive and process applications from approximately 3 to 10 percent of eligible students. To process and approve the estimated 1,030 to 3,455 applications each year, three additional full-time equivalent (FTE) staff would be required. In addition to application processing and approval, it is assumed the staff would provide technical assistance concerning the program to school districts, charter schools, and qualifying institutions. Based on current growth rates for this population, it is estimated that more than 57,665 students could be eligible for the program by FY2016, increasing the estimated number of applications to between 1,729 and 5,760 a year.
The TEA would be permitted to retain some of the funding from the amounts due to the qualifying institutions to cover the agency’s cost to administer the program. The TEA assumes that it would retain funds sufficient to cover the costs of the staff necessary to administer the program and to cover the costs to develop the data collection and payment distribution systems. These costs would amount to $499,251 in FY2013 and would decline to $257,651 in FY2014 and beyond as initial systems development activities for data collection and payment distribution systems are assumed to be completed in the first year of implementation.
It is assumed that funds would not be available to conduct the annual evaluation, so that provision is not assumed to have a fiscal impact.
Under new Section 29.506, Education Code, the bill would provide funding for student participation in the program in the same manner as Foundation School Program funding is determined for open-enrollment charter schools, multiplied by 1.1. While the determination of funding level is based on Foundation School Program formula funding on a statewide average entitlement basis, the source of the state funding provided under the bill is unspecified. For the purpose of this estimate it is assumed that the source of state aid provided to qualifying institutions is intended to be the Foundation School Program.
The TEA assumes that some of the 429 students who are currently ineligible for FSP funding would find qualifying institutions that met their needs sufficiently to attend a full day program. For the purpose of this fiscal note, the Agency assumed that 25 percent of the 429 students who are currently served less than full-time in public schools would become eligible for full-time FSP funding under the program each year beginning in FY2013. This population is assumed to grow at 25 percent each year through FY2016 until all 429 of these students would be served. These students would generate funding at the same level as a student at an open-enrollment charter school, which would include the weighted funding for students receiving special education services. This funding is based on the instructional setting of the special education service delivery. Currently, students with pervasive developmental disorders are most frequently served in instructional settings that generate funding for services delivered in a resource room or self-contained classroom. Students receiving funding through these instructional settings currently receive an average per student FSP entitlement of $12,437 in FY2011; multiplied by 1.1 yields a funding level of $13,680. Assuming that 25 percent of the students currently enrolled but not eligible for FSP funding became eligible for the program in the first year, the cost to the FSP in FY2013 is estimated at $ 1.46 million. The cost would rise to $5.8 million by FY 2016 when an estimated 429 additional students would be served by qualifying institutions.
The provisions in Section 29.505 could potentially impact state FSP costs. Should a significant number of students transfer to districts with higher FSP entitlement levels than their districts of residence, state FSP costs could increase. However, this potential cost impact depends on student behavior and thus cannot be determined.
The Agency estimates systems modifications and maintenance costs would be incurred to implement the program established under the bill. Specifically, the FSP payment system would require modification to calculate and deliver funding to qualifying institutions. An estimated $272,000 in professional fees for 3,200 hours of work from business analysts, developers and testers would be required in the first year to build the new module to receive data from the provider institutions and make payments to them. An estimated $54,400 in maintenance costs would be required annually in subsequent years.
| Source Agencies: | 701 Central Education Agency
|
| LBB Staff: | JOB, LXH, JGM, JSp
|