Honorable Brad Buckley, Chair, House Committee on Public Education
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB2249 by Bernal (Relating to the establishment of the Texas Teacher Recruitment Scholarship Program and the Texas Teacher Retention Incentive Program.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB2249, As Introduced: a negative impact of ($401,710,359) through the biennium ending August 31, 2027.
The Higher Education Coordinating Board and Texas Education Agency are required to implement a provision of the bill only if the legislature appropriates money specifically for that purpose. If the legislature does not appropriate money specifically for that purpose, the Higher Education Coordinating Board and Texas Education Agency may, but are not required to, implement a provision of the bill using other appropriations available for that purpose.
The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
General Revenue-Related Funds, Five- Year Impact:
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2026
($2,801,647)
2027
($398,908,712)
2028
($454,318,126)
2029
($497,175,626)
2030
($529,322,501)
All Funds, Five-Year Impact:
Fiscal Year
Probable Savings/(Cost) from General Revenue Fund 1
Change in Number of State Employees from FY 2025
2026
($2,801,647)
7.0
2027
($398,908,712)
7.0
2028
($454,318,126)
8.0
2029
($497,175,626)
8.0
2030
($529,322,501)
8.0
Fiscal Analysis
The bill would establish the Texas Teacher Recruitment Scholarship Program administered by the Higher Education Coordinating Board (Board) and the Texas Teacher Retention Incentive Program administered by the Texas Education Agency (TEA).
The Texas Teacher Recruitment Scholarship Program would provide annual conditional scholarships to students enrolled in university sponsored teacher preparation programs who agree to enter into a contract with a school district or open-enrollment charter school to serve as a teacher for four years. Under provisions of the bill, the number of new students awarded a scholarship shall not exceed 2 percent of the current teacher workforce as reported by TEA.
The Texas Teacher Retention Incentive Program would provide incentives for certain teachers committed to remaining in their public school for at least four years. Eligible teachers would receive an annual retention incentive of $10,000 for a period of four years. School districts and charter schools would be required to nominate annually a number of teachers equal to 8 percent of the teacher workforce. TEA would be required to develop rules, support implementation of the grant program, and provide certain reports.
Methodology
The estimates for eligible students for the Texas Teacher Recruitment Scholarship Program were provided by the Board based on teacher workforce data supplied by TEA. The Board used 2 percent of the total teacher workforce, which is the maximum amount permitted under the bill. The Board assumed that there were enough eligible students attending public and private four-year institutions to use the maximum number of new scholarships each year. They indicated that this may or may not be the case as there is insufficient data available to assess the number of students enrolled in “university sponsored teacher preparation programs,” specifically at private/independent institutions. For this analysis, public universities were set at 80 percent of the cap, while private/independent institutions were set at 20 percent, roughly in line with student distributions between the two groups statewide. A year-to-year retention rate of 75 percent was set to simulate regular changes in enrollment status and program participation. For both groups of institutions, the total award amount was set at $10,000 per year, as both groups have average tuition & fees per semester greater than $5,000. Based on these assumptions, the Board estimates that scholarships through the program would cost $76.2 million in fiscal year 2027 and increase in future years to $208.4 million by fiscal year 2030.
The Board indicates that 4 FTEs would need to be hired in fiscal year 2026 and fiscal year 2027 at a total cost for salaries and wages, retirement benefits and other costs at $369,840 per year. Beginning in fiscal year 2028, an additional FTE would be hired. The total costs for salaries and wages and retirement benefits for these 5 FTEs is $437,982 per year.
TEA estimates that if 8 percent of teachers were eligible to be nominated, then total retention incentive grants would be approximately $320.0 million annually beginning in fiscal year 2027. Funding for the program would be subject to appropriation.
TEA estimates that 3 FTEs would be needed to implement provisions of the bill at a cost of $0.4 million in each fiscal year.
Technology
The Board estimates a one-time technology cost of $1.3 million in fiscal year 2026 to implement the program.
TEA assumes that IT costs for implementation of the bill would be $0.7 million in fiscal year 2026, $1.9 million in fiscal year 2027, and $0.1 million in subsequent fiscal years.
Local Government Impact
Local education agencies would be required to determine which individuals are eligible for nomination for the Texas Teacher Retention Incentive Program; however, it is assumed that this could be accomplished with existing resources.