LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 83RD LEGISLATIVE REGULAR SESSION April 24, 2013 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 Estimated Two-year Net Impact to General Revenue Related Funds for HB2753, Committee Report 1st House, Substituted: a negative impact of ($6,200,000) through the biennium ending August 31, 2015. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 83RD LEGISLATIVE REGULAR SESSION
April 24, 2013
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
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
Honorable Dan Branch, Chair, House Committee on Higher Education
Honorable Dan Branch, Chair, House Committee on Higher Education
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
HB2753 by Branch (relating to excellence funding for health-related institutions of higher education.), Committee Report 1st House, Substituted
HB2753 by Branch (relating to excellence funding for health-related institutions of higher education.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for HB2753, Committee Report 1st House, Substituted: a negative impact of ($6,200,000) through the biennium ending August 31, 2015. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
Estimated Two-year Net Impact to General Revenue Related Funds for HB2753, Committee Report 1st House, Substituted: a negative impact of ($6,200,000) through the biennium ending August 31, 2015.
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 2014 ($3,100,000) 2015 ($3,100,000) 2016 ($3,100,000) 2017 ($3,100,000) 2018 ($3,100,000)
2014 ($3,100,000)
2015 ($3,100,000)
2016 ($3,100,000)
2017 ($3,100,000)
2018 ($3,100,000)
All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromNew General Revenue Dedicated Probable (Cost) fromNew 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)
Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromNew General Revenue Dedicated Probable (Cost) fromNew 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)
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)
Fiscal Analysis
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. The bill would take effect September 1, 2013, or immediately with a vote of two-thirds of all members elected to each house of the Legislature.
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.
The bill would take effect September 1, 2013, or immediately with a vote of two-thirds of all members elected to each house of the Legislature.
Methodology
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.
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.
Local Government Impact
No fiscal implication to units of local government is anticipated.
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
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
UP, KK, SK, DEH