| TO: | Honorable Dan Branch, Chair, House Committee on Higher Education |
| FROM: | Ursula Parks, Director, Legislative Budget Board |
| IN RE: | HB2753 by Branch (relating to excellence funding for health-related institutions of higher education.), Committee Report 1st House, Substituted |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2014 | ($3,100,000) |
| 2015 | ($3,100,000) |
| 2016 | ($3,100,000) |
| 2017 | ($3,100,000) |
| 2018 | ($3,100,000) |
| Fiscal Year | Probable Savings/(Cost) from General Revenue Fund 1 |
Probable Revenue Gain/(Loss) from New General Revenue Dedicated |
Probable (Cost) from New General Revenue Dedicated |
|---|---|---|---|
| 2014 | ($3,100,000) | $3,100,000 | ($3,100,000) |
| 2015 | ($3,100,000) | $3,100,000 | ($3,100,000) |
| 2016 | ($3,100,000) | $3,100,000 | ($3,100,000) |
| 2017 | ($3,100,000) | $3,100,000 | ($3,100,000) |
| 2018 | ($3,100,000) | $3,100,000 | ($3,100,000) |
This legislation would do one or more of the following: create or recreate a dedicated account in the General Revenue Fund, create or recreate a special or trust fund either with or outside of the Treasury, or create a dedicated revenue source. The fund, account, or revenue dedication included in this bill would be subject to funds consolidation review by the current Legislature.
The bill would establish the Excellence Fund for Health Related Institutions in the General Revenue Fund, and would consist of money transferred to it or appropriations from the Legislature. In addition, the Comptroller would be able to solicit and accept gifts or grants for the fund from any public or private source.
According to provisions of the bill, to be eligible for distributions from the fund, a health related institution (HRI) must have a medical school, and make a one-time initial transfer to the fund from its non-formula appropriations in an amount of not less than $2.5 million, as determined by the institution, and as specified in the General Appropriations Act. The Legislature would have to ensure that each eligible institution receives total distributions from the fund in an amount that is equal to or exceeds the amount of its initial transfer.
According to provisions of the bill, each fiscal year, a total of 25 points would be awarded to eligible HRIs for each of the following metrics: (1) sponsored research; (2) faculty quality; (3) doctoral degrees; (4) philanthropy; (5) commercialization; and (6) patents. Each fiscal year, each eligible HRI would be entitled to receive a share of the money in proportion to the HRI's percentage of the total number of points awarded. Each biennium, each of the six metrics would be determined using the average of the three preceding years for which the information is available, and the determined average governs distributions from the fund for each year of that biennium.
In order for the participating institutions to not experience a net loss after their transfer of no less than $2.5 million into the Excellence Fund, state appropriations into the Excellence Fund will be required each biennium. For purposes of this analysis, it is assumed that there would be a minimum appropriation of $6.2 million in General Revenue each biennium to implement the provisions of the bill. It is also assumed that the transfers from the participating institutions will range from $2.5 million to $35.0 million each biennium.
| Source Agencies: | 710 Texas A&M University System Administrative and General Offices, 720 The University of Texas System Administration, 768 Texas Tech University System Administration, 781 Higher Education Coordinating Board, 769 University of North Texas System Administration
|
| LBB Staff: | UP, KK, SK, DEH
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