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F I S C A L I M P A C T R E P O R T

SPONSOR Martinez

ORIGINAL DATE

LAST UPDATED

2/17/07

HB 756

SHORT TITLE Next Generation Fund

SB

ANALYST Lucero

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

$10,000.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB242

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

FY09

$10,000

$0 Recurring Next Generation

Fund

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Children, Youth and Families Department (CYFD)

Public Education Department (PED)

SUMMARY

Synopsis of Bill

House Bill 756 appropriates ten million ($10,000,000) from the general fund to the next

generation fund (NGF) for expenditure in fiscal year 2008 to promote positive child and youth

development and prevent the abuse and neglect of children pursuant to the Children’s Trust Fund

Act.

House Bill 756 – Page

2

FISCAL IMPLICATIONS

The appropriation of ten million ($10,000,000) contained in this bill is a recurring expense to the

general fund. Any unexpended or unencumbered balance remaining at the end of 2008 shall

revert to the general fund.

Under the Children’s Trust Fund Act, under which the Next Generation Fund operates, the FY05

enabling statute, created the fund as a non-reverting fund. Funding is added to the corpus by

appropriation and interest generated off the corpus is used for program expenditure, therefore the

funding should not revert to the general fund at the end of FY08.

The appropriation in this bill is not part of the Children, Youth and Families Department’s

request and is not included in the Executive recommendation of Children, Youth and Families

Department.

SIGNIFICANT ISSUES

The next generation fund (NGF) expanded the Children’s Trust Fund mission beyond its

enabling mission which focused on child abuse and neglect prevention. Originally, the

Children’s Trust Fund was created by state statute in 1978 to provide the means to develop

innovative projects which address issues such as, preventing child abuse and neglect, providing

medical, psychological treatment for victims of abuse and neglect and develop community based

services on child abuse and neglect.

NGF projects must provide positive child and youth development activities that support physical,

mental and social well-being; promote strong and health families and help prevent abuse and

neglect; promote community service, leadership and citizenship; and provide community

coordination of child and youth development programming.

Interest monies generated by the fund will be distributed through a competitive grant process,

targeting 0–24-year-old children and youths, administrated by the Children, Youth and Families

Department and guided by the state-appointed board of the Children’s Trust Fund (CTF).

PERFORMANCE IMPLICATIONS

This bill does address any specific CYFD performance measures; however, performance

measures should be positively impacted by any amount of increased funding.

NGF projects can incorporate education and "High yield" out-of-school learning activities and

effective instructional strategies may improve attendance, positively impacting public school

performance measures and benchmarks regarding reading, language arts, math and graduation

rates. Additionally, the NGF may positively impact the Pre-K initiative in terms of student

readiness to enter school better prepared to learn.

ADMINISTRATIVE IMPLICATIONS

Up to ten percent of the income received from investment of the NGF may be expended for costs

to administer the fund and next generation projects. Administrative costs include per diem

(members of the CTF board) and mileage, staff salaries and expenses related to administration of

House Bill 756 – Page

3

the fund.

CYFD administers the Next Generation Council which oversees administration of the fund. The

proposal does not present significant new administrative activities for the department.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates SB242

TECHNICAL ISSUES

Recent research shows that at the elementary and high school educational levels, high achievers

spent more time in “high yield" out-of-school learning activities than low achievers. "High

yield" out-of-school learning activities include such diverse activities as reading, writing,

studying, being tutored, watching educational TV, playing with computers, going to after-school

pro-grams and clubs, volunteering, doing a hobby and participating in organized sports (Clark,

2002).

OTHER SUBSTANTIVE ISSUES

Competitive awards will support community-identified needs and innovative projects, which

might include special in-school and out-of-school initiatives like family literacy projects,

prevention/intervention projects, after-school programs and community service and youth

leadership.

Interest monies generated by the fund will be distributed through a competitive grant process,

targeting 0–24-year-old children and youths, administrated by the Children, Youth and Families

Department and guided by the state-appointed board of the CTF.

Students who spend no time in extracurricular activities are 49% more likely to use drugs and

37% are more likely to become teen parents than those who spend one to four hours per week in

extracurricular activities (U.S. Dept. of Education, 2002).

Recent research shows that at the elementary and high school educational levels, high achievers

spent more time in “high yield" out-of-school learning activities than low achievers. "High

yield" out-of-school learning activities include such diverse activities as reading, writing,

studying, being tutored, watching educational TV, playing with computers, going to after-school

programs and clubs, volunteering, doing a hobby and participating in organized sports (Clark,

2002).

ALTERNATIVES

None identified

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

Status Quo

DL/csd