HBA-JEK H.J.R. 106 77(R) BILL ANALYSIS Office of House Bill AnalysisH.J.R. 106 By: Gallego Teacher Health Insurance, Select 3/23/2001 Introduced BACKGROUND AND PURPOSE School districts, especially rural districts, face an increasingly difficult task of providing insurance to teachers and employees. The health insurance costs of many rural school districts have increased to the extent that funds for pay raises have instead been applied to increased premium costs. Better health insurance benefits would help Texas attract and retain qualified teachers. As proposed, House Joint Resolution 106 requires the submission to the voters of a constitutional amendment relating to the provision of group health benefits for active and retired public school employees, distributions from the permanent school fund, and the establishment of the school employees primary health coverage fund. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this resolution does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Joint Resolution 106 amends the Texas Constitution to authorize the legislature to provide for counties that provide public primary and secondary schools and independent school districts to levy an additional ad valorem tax at a rate determined by the legislature, the county, or the district to pay for group health benefits for active and retired public school employees. The resolution prohibits an ad valorem tax from being levied unless approved by a majority of the voters of the county or school district voting at an election held for that purpose. H.J.R. 106 modifies the permanent school fund (PSF) to consist of all land appropriated for public schools by the Texas Constitution or other state laws as well as other properties and funds belonging to the PSF. The resolution allocates a portion of the PSF distributions of each fiscal year to the available school fund (ASF), along with the taxes authorized by the constitution or general law to be part of the ASF. The resolution establishes the school employees primary health coverage fund (health coverage fund) to be used only to provide group health benefits for active and retired public school employees. The health coverage fund consists of school district ad valorem taxes levied as provided by this resolution, a portion of the distributions each fiscal year from the PSF, and other funds appropriated or dedicated for the purpose of providing health benefits. H.J.R. 106 provides that the total amount distributed in each fiscal year from the PSF to the ASF and the health coverage fund must be at least three percent but not more than seven percent of the average fair market value of the PSF at the end of each of the preceding 12 quarters, in accordance with the rate adopted by a vote of two-thirds of the total membership of the State Board of Education (board), or five percent of the average fair market value of the PSF at the end of each of the preceding 12 quarters if the board does not adopt a rate. The bill provides that the total distribution from the PSF to the ASF and the health coverage fund for the state fiscal years beginning September 1, 2001 and September 1, 2002 must be five percent of the market value of the PSF on the first day of the appropriate fiscal year. The resolution requires the General Appropriations Act to determine for each state fiscal year which portion of the distribution from the PSF will be placed in the ASF and which portion will go to the health coverage fund. The resolution prohibits the portions for a state fiscal year from being changed after the beginning of the fiscal year, and provides that the portion placed in the ASF for a state fiscal year must be at least 50 percent but not more than 75 percent of the total distribution from the PSF for that fiscal year. The resolution removes the provision that authorizes the legislature to provide for the use of income from the PSF to guarantee bonds issued by school districts or the state for the purpose of making loans to or purchasing school district bonds for the acquisition, construction, or improvement of instructional facilities. FOR ELECTION The proposed constitutional amendment shall be submitted to the voters at an election to be held November 6, 2001.