COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:4414H.03C Bill No.:HCS for HB 1903 Subject:Education, Elementary and Secondary; Department of Elementary and Secondary
Education
Type:Original Date:February 23, 2022Bill Summary:This proposal modifies provisions related to the virtual school program.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2023FY 2024FY 2025
General Revenue*
(Unknown, could
exceed $60,000)
(Unknown, could
exceed $150,000)
(Unknown, could
exceed $150,000)
Total Estimated Net
Effect on General
Revenue
(Unknown, could
exceed $60,000)
(Unknown, could
exceed $150,000)
(Unknown, could
exceed $150,000)
*Oversight assumes the fiscal impact could exceed the $250,000 threshold.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2023FY 2024FY 2025General Revenue0 to 1 FTE0 to 1 FTE0 to 1 FTETotal Estimated Net
Effect on FTE0 to 1 FTE0 to 1 FTE0 to 1 FTE
☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025
Local Government
Unknown to
(Unknown)
Unknown to
(Unknown)
Unknown to
(Unknown) L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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FISCAL ANALYSIS
ASSUMPTION
Oversight was unable to receive some of the agency responses in a timely manner. Oversight
has presented this fiscal note on the best current information that we have or on prior year
information regarding a similar bill. Upon the receipt of agency responses, Oversight will review
to determine if an updated fiscal note should be prepared and seek the necessary approval to
publish a new fiscal note.
In response to the previous version, officials from Department of Elementary and Secondary
Education (DESE) stated the following:
Section 161.670.1
Update Branding from MOCAP to MCAVSP for website, letter head, and various platforms to
utilize the new logo and letterhead for the new acronym “MCAVSP”. Minimal fiscal impact
expected.
Section 161.670.2
Unable to determine if programming costs needed to modify a system, without knowing which
payments will be withheld. Any system updates would be paid from General Revenue funding.
Section 161.670.3.2
The department will need an updated Student Information System (SIS) to develop and handle
continuous enrollment for students not enrolled in a full-time virtual school. Initial
implementation of updated system estimated at $50,000. Ongoing annual fees based on course
enrollment approximated at $5.00 per enrollment for 30,000 enrollments = $150,000.
Section 161.670.6.1
Proposed changes to the requirements for full-time providers will necessitate a separate RFP for
full-time providers and per course providers. Minimal fiscal impact expected.
Section 161.670.11.6
The addition of comparative data and performance by students in their prior educational setting
into the Annual Report will necessitate the development of new data rules in MOSIS and an
additional data analyst to develop and run the reports. New rules in MOSIS core data estimated
at $10,000. Will need .5 FTE (Data Analyst) to oversee development - $50,136.
Oversight notes DESE indicated the need for a 0.5 FTE. Oversight will show this as a range of
impact of $0 (duties can be absorbed by existing FTE) to the cost of hiring a full FTE. L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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Oversight notes this proposal appears to expand the eligibility for virtual school enrollment to
any student who is eligible to enroll in a Missouri public school rather than to only students who
have attended for a public school for at least one semester. Oversight assumes this proposal
would allow previously homeschooled students and private school students to enroll in virtual
courses paid for by the school districts.
Oversight assumes expanding the eligibility could increase enrollment for school districts
causing an increased call to the foundation formula. Oversight will show an unknown cost to
General Revenue for newly eligible and enrolled virtual students. For every newly enrolled
student achieving eligibility under this proposal, the cost is estimated at $5,066 (average state aid
per ADA) with subsequent increase in revenue for school districts.
Assuming the average state funding per ADA is $5,066, Oversight estimates to reach a revenue
impact of $250,000 would require a change of approximately 50 ADA ($5,066 * 50 = $253,300).
Oversight notes an increase of 50 ADA is approximately a 0.01% increase in total ADA
(50/843,650); therefore, Oversight assumes it is possible the cost could exceed $250,000.
Oversight notes, currently, parents can appeal a decision to the local school board and to the
Department of Elementary and Secondary Education. Under this proposal, parents have the
ultimate decision on whether to enroll their child in a virtual program.
Oversight has requested the number of students approved and denied for enrollment by school
districts in the MOCAP program. However, DESE has not collected this type of data prior to rule
5 CSR 20-100.230 going into effect. 5 CSR 20-100.230 became effective on 1/30/21.
Oversight requested the number of applicants that have appealed to DESE. Per DESE, during
the 20-21 school year they have had 6 appeals. Two were overturned and four have been upheld.
Oversight will show an increased cost for school districts that pay course providers for students
newly eligible and enrolled in virtual courses. Oversight assumes the maximum cost per student
is $6,375 or the State Adequacy Target unless “the student receives additional federal or state aid
which shall additionally be included in the payment”. Therefore, Oversight will show an
unknown cost to school districts for students newly eligible and enrolled in virtual courses.
Oversight received no responses from school districts related to the fiscal impact of this
proposal. Oversight has presented this fiscal note on the best current information available. Upon
the receipt of responses, Oversight will review to determine if an updated fiscal note should be
prepared and seek the necessary approval to publish a new fiscal note.
Rule Promulgation
Officials from the Joint Committee on Administrative Rules assume this proposal is not
anticipated to cause a fiscal impact beyond its current appropriation. L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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Officials from the Office of the Secretary of State (SOS) note many bills considered by the
General Assembly include provisions allowing or requiring agencies to submit rules and
regulations to implement the act. The SOS is provided with core funding to handle a certain
amount of normal activity resulting from each year's legislative session. The fiscal impact for
this fiscal note to the SOS for Administrative Rules is less than $5,000. The SOS recognizes that
this is a small amount and does not expect that additional funding would be required to meet
these costs. However, the SOS also recognizes that many such bills may be passed by the
General Assembly in a given year and that collectively the costs may be in excess of what the
office can sustain with its core budget. Therefore, the SOS reserves the right to request funding
for the cost of supporting administrative rules requirements should the need arise based on a
review of the finally approved bills signed by the governor. L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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FISCAL IMPACT – State GovernmentFY 2023
(10 Mo.)
FY 2024FY 2025GENERAL REVENUECosts – DESE - programming costs to
modify system for withheld payments -
§161.670.2 (p.3)
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
Costs – DESE - updated student
information system for enrollment and
annual fees based on course enrollment
- §161.670.3 (2) (p.3)
($50,000)($150,000)($150,000)
Costs - DESE - increased call to the
foundation formula for increased
enrollment eligibility for virtual courses
- §161.670.3 (p.3)
(Unknown)(Unknown)(Unknown)
Costs - development of new data rules -
§161.670.11 (6) (p.3-4)($10,000)($0)($0)
Costs - DESE - §161.670.11 (6)$0 or …$0 or …$0 or … Personnel Service($41,780)($50,637)($51,144) Fringe Benefits($25,663)($30,977)($31,162) Expense & Equipment($15,858)($8,288)($8,494)Total Costs - DESE($83,301)($89,902)($90,800)FTE Change0 or 1 FTE0 or 1 FTE0 or 1 FTE
ESTIMATED NET EFFECT ON
GENERAL REVENUE
(Unknown,
could exceed
$60,000)
(Unknown,
could exceed
$150,000)
(Unknown,
could exceed
$150,000)
Estimated Net FTE Change on General
Revenue0 or 1 FTE0 or 1 FTE0 or 1 FTE L.R. No. 4414H.03C
Bill No. HCS for HB 1903
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FISCAL IMPACT – Local GovernmentFY 2023
(10 Mo.)
FY 2024FY 2025SCHOOL DISTRICTSRevenue Gain - increase in foundation
formula distributions for increased
enrollment from newly eligible students
- §161.670.3 (p.3)UnknownUnknownUnknown
Costs - payments to course providers
for newly eligible students enrolled in
virtual courses - §161.670.3 (p.3)(Unknown)(Unknown)(Unknown)
ESTIMATED NET EFFECT ON
SCHOOL DISTRICTS
Unknown to
(Unknown)
Unknown to
(Unknown)
Unknown to
(Unknown)
FISCAL IMPACT – Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
FISCAL DESCRIPTION
This proposal modifies provisions related to the virtual school program.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Elementary and Secondary Education
Julie MorffRoss StropeDirectorAssistant DirectorFebruary 23, 2022February 23, 2022