HBA-MPM H.B. 3348 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3348 By: Turner, Bob Higher Education 4/7/1999 Introduced BACKGROUND AND PURPOSE Currently, general revenue funding for the 35 general academic teaching institutions in Texas is based on recommended formula funding for each institution, less its estimated educational and general (E&G) revenue, which is derived mostly from tuition and fees, for each fiscal year of the biennium. Underestimated E&G revenues may trigger excessively large general revenue appropriations, however, the state has no effective mechanism to monitor actual E&G revenues or a process to adjust their general revenue appropriations accordingly. H.B. 3348 requires the office of the comptroller of public accounts (comptroller) and the Texas Higher Education Coordinating Board to prescribe a mechanism for each institution to reconcile the differences between estimated E&G revenues used in the budget process and actual E&G revenues collected and to report that information to the comptroller's office and the Legislative Budget Board within 60 days after the end of the fiscal year. This bill further prohibits an institution from spending general appropriations equal to that amount in the next fiscal year without the Legislative Budget Board's approval, if an institution's E&G income exceeds its estimate. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 61.065, Education Code, by adding Subsections (c) and (d), as follows: (c) Requires the comptroller of public accounts (comptroller) and the Texas Higher Education Coordinating Board (board) to jointly prescribe and periodically update a uniform system of financial accounting of all educational and general funds received by an institution of higher education. Provides that these funds include tuition, laboratory fees, student teaching fees, organized activities, proceeds from the sale of educational and general equipment, and indirect cost recovery fees received by the institution. Provides that this system may require: _any portion of educational and general funds received to be deposited in the treasury; _all educational and general funds to be accounted for in a manner allowing the state auditor to accurately and efficiently audit an institution's educational and general funds; and _each institution to reconcile any estimated educational and general funds calculated during the previous biennial budget process to the actual amount of educational and general funds that the institution received. (d) Requires each institution to report its reconciliation under Subsection (c) to the comptroller and the Legislative Budget Board no later than 60 days after the last day of each fiscal year. Prohibits the amount of the institution's general revenue appropriations equal to the difference of the exceeded estimate of the educational and general funds received in that fiscal year, if an excess exists, from being expended by the institution in the following fiscal year without prior approval of the Legislative Budget Board. SECTION 2. Authorizes the comptroller and the board to adopt a uniform system of accounting described by Section 61.065(c), Education Code, as added by this Act, no later that September 1, 1999. SECTION 3.Emergency clause. Effective date: upon passage.