LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION April 8, 2015 TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB3294 by Burkett (Relating to the continuation and functions of the Texas Workforce Commission.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB3294, As Introduced: a negative impact of ($9,794,966) 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 8, 2015
TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development FROM: Ursula Parks, Director, Legislative Budget Board IN RE:HB3294 by Burkett (Relating to the continuation and functions of the Texas Workforce Commission.), As Introduced
TO: Honorable Angie Chen Button, Chair, House Committee on Economic & Small Business Development
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: HB3294 by Burkett (Relating to the continuation and functions of the Texas Workforce Commission.), As Introduced
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
HB3294 by Burkett (Relating to the continuation and functions of the Texas Workforce Commission.), As Introduced
HB3294 by Burkett (Relating to the continuation and functions of the Texas Workforce Commission.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB3294, As Introduced: a negative impact of ($9,794,966) 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 HB3294, As Introduced: a negative impact of ($9,794,966) 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 ($9,794,966) 2018 ($9,316,866) 2019 ($9,316,866) 2020 ($9,316,866)
2016 $0
2017 ($9,794,966)
2018 ($9,316,866)
2019 ($9,316,866)
2020 ($9,316,866)
All Funds, Five-Year Impact: Fiscal Year Probable (Cost) fromGeneral Revenue Fund1 Probable Savings fromGeneral Revenue Fund1 Probable Savings fromFederal Funds555 Probable Revenue Gain fromUnempl Comp Sp Adm Acct165 2016 $0 $0 $0 2017 ($9,967,166) $172,200 $2,085,619 2018 ($9,967,166) $650,300 $3,852,119 $510,376 2019 ($9,967,166) $650,300 $3,852,119 $427,055 2020 ($9,967,166) $650,300 $3,852,119 $363,109 Fiscal Year Probable Revenue Gain fromEmployment/Trng Investment Assmnt5128 Probable Revenue Gain fromUNEMPLOYMENT TRST FND ACCT938 Change in Number of State Employees from FY 2015 2016 $0 $0 0.0 2017 $0 $47,742,354 (6.0) 2018 $48,137 $38,542,318 (27.0) 2019 $43,322 $31,959,881 (27.0) 2020 $40,466 $27,699,077 (27.0)
Fiscal Year Probable (Cost) fromGeneral Revenue Fund1 Probable Savings fromGeneral Revenue Fund1 Probable Savings fromFederal Funds555 Probable Revenue Gain fromUnempl Comp Sp Adm Acct165 2016 $0 $0 $0 2017 ($9,967,166) $172,200 $2,085,619 2018 ($9,967,166) $650,300 $3,852,119 $510,376 2019 ($9,967,166) $650,300 $3,852,119 $427,055 2020 ($9,967,166) $650,300 $3,852,119 $363,109
2016 $0 $0 $0
2017 ($9,967,166) $172,200 $2,085,619
2018 ($9,967,166) $650,300 $3,852,119 $510,376
2019 ($9,967,166) $650,300 $3,852,119 $427,055
2020 ($9,967,166) $650,300 $3,852,119 $363,109
Fiscal Year Probable Revenue Gain fromEmployment/Trng Investment Assmnt5128 Probable Revenue Gain fromUNEMPLOYMENT TRST FND ACCT938 Change in Number of State Employees from FY 2015 2016 $0 $0 0.0 2017 $0 $47,742,354 (6.0) 2018 $48,137 $38,542,318 (27.0) 2019 $43,322 $31,959,881 (27.0) 2020 $40,466 $27,699,077 (27.0)
2016 $0 $0 0.0
2017 $0 $47,742,354 (6.0)
2018 $48,137 $38,542,318 (27.0)
2019 $43,322 $31,959,881 (27.0)
2020 $40,466 $27,699,077 (27.0)
Fiscal Analysis
The bill would amend the Education Code, Government Code, Human Resources Code, Labor Code, and Property Code relating to the continuation and functions of the Texas Workforce Commission (TWC). The bill would require TWC to include information regarding any formal enforcement action taken by the commission against a career school or college on its current directory of schools. Provisions of the bill would remove the schedule of fees for certain career schools and college fees from statute, and would authorize the agency to set the fees by rule. The bill would allow TWC to receive criminal history record information for certain individuals associated with vocational rehabilitation services from the Department of Public Safety (DPS) contingent upon federal approval of the transfer of duties under the Texas Human Resources Code, Title 7-A to TWC. The bill would transfer the powers and duties under Chapters 91, 111, and 117 of the Human Resources Code from the Department of Assistive and Rehabilitative Services (DARS) to TWC contingent upon federal approval of the transfer of such duties under Title 7-A. The bill would amend the Texas Human Resources Code by adding Title 7-A regarding the transfer of the Vocational Rehabilitation (VR), Disability Determination Services, and Business Enterprises of Texas programs from DARS to TWC no later than September 1, 2016 contingent upon federal approval of the transfer. This bill requires TWC to integrate VR staff from department offices into TWC's local workforce development centers no later than August 31, 2018; and to integrate the two unique vocational rehabilitation programs into a single program no later than September 1, 2016. The bill transfers the powers and duties of the Human Rights Commission to the TWC three-member commission and streamlines the Civil Rights Division functions. The bill would require the agency to develop risk-assessment criteria in determining the circumstances of providing additional reviews of the personnel policies and procedures of state agencies, and to set the related reimbursement rates at a level necessary to recover such expenses. In addition, the bill authorizes TWC to participate in the federal Treasury Offset Program; requires TWC to collect and report on information regarding employment discrimination complaints; adds reporting requirements for TWC related to the effectiveness of their subsidized child care programs; and eliminates statutes enabling the Civil Rights Division's review of Fire Department tests, Rehabilitation Council of Texas, and the Human Rights Commission. This bill would take effect September 1, 2015.
Methodology
According to TWC, DPS, and the Texas Department of Criminal Justice all of the duties and responsibilities associated with implementing the provisions of the bill relating to career schools and colleges, criminal history records, the Texas Rising Star program, the Civil Rights Division, and the federal Treasury Offset Program could be accomplished by utilizing existing agency resources.The costs relating to the transfer of the Vocational Rehabilitation, Disability Determination Services, and Business Enterprises of Texas programs from DARS to TWC totals approximately $427.8 million in each fiscal year beginning in fiscal year 2017. However, as it is assumed that any additional costs to TWC would correspond to equivalent cost savings at DARS, the net effect of this transfer is $0 and 0.0 FTEs and is not shown in the tables above.According to information provided by DARS, the agency would have an additional cost of $4.2 million annually related to the loss of federal VR grant funds. As the federal grant does not allow these funds to transfer to any agency that is not administering the VR program, DARS would require General Revenue of $1.9 million for Deaf and Hard of Hearing and $2.3 million for Older Individual programs that had previously been funded with these federal grant dollars.According to the Health and Human Services Commission (HHSC), the transfer of programs from DARS would impact the provision of administrative and enterprise support services performed by the agency. The five health and human services agencies currently use the approved cost allocation plans to ensure maximization of Federal Funds for these functions. The five agencies pay HHSC to perform these functions. DARS' allocated share is approximately four percent, or $1,268,034 in General Revenue, $17,639,421 million in All Funds, of the total cost allocation plan in fiscal year 2015. Assuming that associated regional lease costs for VR that will be transferred to TWC are removed from this total and that the remainder would be reallocated to the other health and human services agencies, there is a projected cost of $5,767,166 in General Revenue to discontinue paying HHSC oversight costs. According to TWC, there would be cost savings of $2,257,819 and 6.0 FTEs in fiscal year 2017 and $4,502,419 and 27.0 FTEs each subsequent fiscal year related to the consolidation of the two unique VR programs and the integration of regional VR staff into TWC's local workforce development centers.Based on information provided by TWC, it is estimated that participation in the federal Treasury Offset Program would result in additional revenue to the state of $1,300,540 in General Revenue-Dedicated Fund 165, $131,925 in General Revenue-Dedicated Fund 5128, and $145,943,630 in Other Fund 938 over the next five years. Estimates of fiscal impact assume a 12 percent collection rate from participation in the federal Treasury Offset Program on projected uncollected and covered contributions to unemployment compensation debt. The agency anticipates that any costs associated with the implementation of the program can be absorbed in the current federal Unemployment Insurance grant.This analysis assumes that all costs related to the implementation of the bill are compared to current agency structures and costs. Analysis does not take into consideration any pending legislation related to appropriations or sunset recommendations.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 116 Sunset Advisory Commission, 304 Comptroller of Public Accounts, 320 Texas Workforce Commission, 405 Department of Public Safety, 529 Health and Human Services Commission, 538 Assistive and Rehabilitative Services, Department of, 539 Aging and Disability Services, Department of, 696 Department of Criminal Justice
116 Sunset Advisory Commission, 304 Comptroller of Public Accounts, 320 Texas Workforce Commission, 405 Department of Public Safety, 529 Health and Human Services Commission, 538 Assistive and Rehabilitative Services, Department of, 539 Aging and Disability Services, Department of, 696 Department of Criminal Justice
LBB Staff: UP, CL, NV, JLi, JN
UP, CL, NV, JLi, JN