Bill: SB 677, 84(R) - 2015

A fiscal note dated April 23, 2015 anticipates that the bill would have no effect on revenue. The fiscal implications would vary by state agency depending on the amount of savings retained. Potential savings to the State, and to the General Revenue Fund, would be dependent on the extent to which participating agencies had outstanding general obligation debt. Although the bill would not make an appropriation, it would establish the basis for an appropriation.

Senate Bill 677 would allow a state agency that does not spend all the money that was appropriated to this state agency to retain one-half of the savings it realized.

One-half of the retained savings would have to be used to make additional principal payments for general obligation bonds issued by the agency or on behalf of the agency by the Texas Public Finance Authority. If there are no such obligations outstanding, one-half of the retained money could be used to provide bonuses distributed equally to employees who are currently working full-time or worked full-time for the entire fiscal year in which the savings were realized and are responsible for the savings.

The amount of the bonuses would depend on the percentage of the total amount of undedicated general revenue  derived from nonfederal sources appropriated to the agency for the fiscal year the savings represent.

Senate Bill 677 aims at encouraging state agencies to save more of the money that has been appropriated to them in a fiscal year by allowing them to keep more of the savings they make. The bill would even consider giving bonuses, in certain cases, to employees responsible for the savings.

Since Senate Bill 677 would neither cost taxpayers additional money, nor would it save taxpayers money (there is no provision stipulating that any of the saved money would be returned to taxpayers), we will remain neutral on this bill.