Honorable Giovanni Capriglione, Chair, House Committee on Delivery of Government Efficiency
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB2832 by Harris Davila (Relating to requiring the approval of the comptroller of public accounts before a state agency may accept federal money.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB2832, As Introduced: a negative impact of ($5,940,000) through the biennium ending August 31, 2027.
There could be an additional indeterminate loss of federal funding due to time delays or denials from the Comptroller. However, the bill does not prescribe a methodology for the Comptroller to approve or deny requests; therefore, the amount, if any, cannot be determined.
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
($3,330,000)
2027
($2,610,000)
2028
($2,610,000)
2029
($2,610,000)
2030
($2,610,000)
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
($3,330,000)
24.0
2027
($2,610,000)
24.0
2028
($2,610,000)
24.0
2029
($2,610,000)
24.0
2030
($2,610,000)
24.0
Fiscal Analysis
The bill would require state agencies, including institutions of higher education, to request and receive approval from the Comptroller prior to accepting federal funding. The request would include a description and cost estimate for conditions and limitations associated with the acceptance of the federal funds. The Comptroller would be required to review the request and communicate an approval or denial to the state agency before any applicable federal deadlines.
The Comptroller would adopt rules as necessary to implement the bill.
Methodology
It is assumed the Comptroller would require twenty-four full-time equivalent (24.0 FTEs) positions to implement the legislation. The additional FTEs include 23.0 Program Specialists IV to coordinate with state agencies regarding incoming federal funds by monitoring grants, accessing agencies' funding mechanisms, analyzing and reporting on the conditions and limitations associated with all federal funds, and collecting, evaluating, and approving or denying requests. Additionally, 1.0 Manager V would be needed to provide oversight and support the additional staff. Administrative costs include $2,554,562 in each fiscal year for personnel costs.
Based on the analysis of certain agencies, including the Health and Human Services Commission and Texas Department of Transportation, there could be an additional indeterminate loss of federal funding due to time delays or denials from the Comptroller. However, the bill does not prescribe a methodology for the Comptroller to approve or deny requests; therefore, the amount, if any, cannot be determined.
Based on information provided by the University of Texas System, implementation of the bill could result in time delays or denials impacting research funding or student financial aid. For reference, UT System received approximately $3.2 billion in federal funding in fiscal year 2024. While federal funds are not appropriated in the General Appropriations Act to institutions of higher education, the fiscal impact to institutions of higher education is indeterminate but could be significant.
Technology
It is assumed the Comptroller would require 4,800 programming hours to develop a database and procure software to support the IT requirements. Administrative costs include $720,000 in fiscal year 2026 for one-time contracted IT services and recurring annual cost of $55,438.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies:
242 State Commission on Judicial Conduct, 304 Comptroller of Public Accounts, 320 Texas Workforce Commission, 352 Bond Review Board, 452 Department of Licensing and Regulation, 503 Texas Medical Board, 529 Health and Human Services Commission, 537 State Health Services, Department of, 582 Commission on Environmental Quality, 601 Department of Transportation, 710 Texas A&M University System Administrative and General Offices, 720 The University of Texas System Administration