LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION April 21, 2015 TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB27 by Button (Relating to state economic development measures, including administration of the Texas Enterprise Fund, the abolishment of the Texas emerging technology fund, and the disposition of balances from the Texas emerging technology fund.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for HB27, Committee Report 1st House, Substituted: an impact of $0 through the biennium ending August 31, 2017. 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, 84TH LEGISLATIVE REGULAR SESSION
April 21, 2015
TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB27 by Button (Relating to state economic development measures, including administration of the Texas Enterprise Fund, the abolishment of the Texas emerging technology fund, and the disposition of balances from the Texas emerging technology fund.), Committee Report 1st House, Substituted
TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: HB27 by Button (Relating to state economic development measures, including administration of the Texas Enterprise Fund, the abolishment of the Texas emerging technology fund, and the disposition of balances from the Texas emerging technology fund.), Committee Report 1st House, Substituted
Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development
Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
HB27 by Button (Relating to state economic development measures, including administration of the Texas Enterprise Fund, the abolishment of the Texas emerging technology fund, and the disposition of balances from the Texas emerging technology fund.), Committee Report 1st House, Substituted
HB27 by Button (Relating to state economic development measures, including administration of the Texas Enterprise Fund, the abolishment of the Texas emerging technology fund, and the disposition of balances from the Texas emerging technology fund.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for HB27, Committee Report 1st House, Substituted: an impact of $0 through the biennium ending August 31, 2017. 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 HB27, Committee Report 1st House, Substituted: an impact of $0 through the biennium ending August 31, 2017.
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 2016 $0 2017 $0 2018 $0 2019 $0 2020 $0
2016 $0
2017 $0
2018 $0
2019 $0
2020 $0
All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromEmerging Technology5124 Probable Revenue Gain/(Loss) fromTexas Treasury Safekeeping Trust Company 2016 $90,618,000 ($90,618,000) ($90,618,000) $9,136,100 2017 $0 $0 $0 $606,100 2018 $0 $0 $0 $6,706,100 2019 $0 $0 $0 $606,100 2020 $0 $0 $0 $962,087 Fiscal Year Probable Savings/(Cost) fromTexas Treasury Safekeeping Trust Company Change in Number of State Employees from FY 2015 2016 ($9,136,100) (7.0) 2017 ($606,100) (7.0) 2018 ($6,706,100) (7.0) 2019 ($606,100) (7.0) 2020 ($962,087) (7.0)
Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromGeneral Revenue Fund1 Probable Savings/(Cost) fromEmerging Technology5124 Probable Revenue Gain/(Loss) fromTexas Treasury Safekeeping Trust Company 2016 $90,618,000 ($90,618,000) ($90,618,000) $9,136,100 2017 $0 $0 $0 $606,100 2018 $0 $0 $0 $6,706,100 2019 $0 $0 $0 $606,100 2020 $0 $0 $0 $962,087
2016 $90,618,000 ($90,618,000) ($90,618,000) $9,136,100
2017 $0 $0 $0 $606,100
2018 $0 $0 $0 $6,706,100
2019 $0 $0 $0 $606,100
2020 $0 $0 $0 $962,087
Fiscal Year Probable Savings/(Cost) fromTexas Treasury Safekeeping Trust Company Change in Number of State Employees from FY 2015 2016 ($9,136,100) (7.0) 2017 ($606,100) (7.0) 2018 ($6,706,100) (7.0) 2019 ($606,100) (7.0) 2020 ($962,087) (7.0)
2016 ($9,136,100) (7.0)
2017 ($606,100) (7.0)
2018 ($6,706,100) (7.0)
2019 ($606,100) (7.0)
2020 ($962,087) (7.0)
Fiscal Analysis
The bill amends Government Code to include projects for commercialization of property derived from University Research Development grants that receive matching funds from the institution and additional private funding, to the eligible uses for the Texas Enterprise Fund. The bill would amend Government Code to shorten the approval period for a grant from the Texas Enterprise Fund.The bill would abolish the Emerging Technology Fund (ETF) and transfer management of the ETF portfolio to the Texas Treasury Safekeeping Trust company with proceeds used for portfolio management and any excess deposited into General Revenue. The bill would allow the unencumbered balances of the ETF to be appropriated only to: the Texas Research Initiative Program (TRIP); the Texas Research University Fund; and to the Comptroller for expenses incurred in managing the investment portfolio in connection with awards from the former ETF. Although the ETF would be abolished effective September 1, 2015, agreements in place before that date would not be affected. All money in the fund on that date and received in the future would be deposited to General Revenue, except for money obligated for existing agreements and money deposited in the fund as a gift, grant or donation under specific terms of use.
Methodology
Using the Comptroller of Public Account's (CPA) Biennial Revenue Estimate, $90.6 million in unexpended balances in General Revenue - Dedicated Emerging Technology Fund Account No. 5124 would be available to be appropriated to: the Texas Research Incentive Program (TRIP); the Texas Research University Fund; the Governor's Research Initiative Fund; and to the Comptroller (CPA) for expenses incurred in managing the investment portfolio in connection with awards from the former ETF. As the bill does not require certain percentages of distribution, it is assumed the balances in General Revenue - Dedicated Emerging Technology Fund 5124 would be transferred into General Revenue and appropriated in undetermined shares to the Texas Research Incentive Program (TRIP); the Texas Research University Fund, and the CPA. The provisions of the bill would reduce the Office of the Governor by 7.0 FTEs that currently administer the Emerging Technology Fund.It is assumed that on-going revenues from investments in entities that received Emerging Technology Funds, estimated by the Office of the Governor to be $9.1 million in 2016, $0.6 million in 2017 $6.7 million in 2018, $0.6 million in 2019 and $1.0 million in 2020, and would be used by the Texas Treasury Safekeeping Trust Company (TTSTC) and the CPA for expenses incurred in managing the investment portfolio in connection with awards from the former ETF. However, the cost to manage the ETF portfolio may be higher or lower depending on the composition of the portfolio.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: 301 Office of the Governor, 304 Comptroller of Public Accounts
301 Office of the Governor, 304 Comptroller of Public Accounts
LBB Staff: UP, CL, EP, LBe
UP, CL, EP, LBe