FISCAL NOTE
FUND(S):
Research Trust Fund
Sources of Revenue:
Special Fund
Legislation creates:
A New Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
It is estimated that the initial $50 million appropriated by the legislature and deposited into a new fund titled “Research Trust Fund” (RTF) with the Board of Treasury Investments (BTI) will yield a return of at least 3% generating $1.3 million through December 2008, FY 2009. At that point, it is estimated that $30 million in matching funds will be generated through private donations and an equal amount of RTF dollars will be transferred to the Research Endowments at WVU and MU for a total of $60 million. These funds will be invested probably by the respective Foundations of each institution hopefully earning an estimated return of 7%. The remaining $20 million of RTF still invested with the BTI will continue to earn interest until estimated January 2009, FY 2010 at which point an additional $20 million in matching funds has been secured through private donations and transferred to the Research Endowments.
Prior to the total $50 million drawdown of State funds, it is estimated that while invested with the BTI, $1.6 million will have been earned from investments. The estimated earnings, less $250,000 for administration, are committed for additional related research efforts by the regional colleges and can be drawn down if additional matching funds are secured by those colleges.
It is hopeful that the initial $50 million investment and investment earnings from the State will be matched and drawn down by the end of FY 2010 on research initiatives.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2008
Increase/Decrease
(use"-") |
2009
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
125,000 |
250,000 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
50,250,000 |
33,950,000 |
110,900,000 |
Explanation of above estimates (including long-range effect):
Revenue Recap
|
|
|
|
|
|
|
|
|
|
Revenue
Recap
|
|
|
2008
|
2009
|
2010
|
Total
|
|
Excess
Lottery
|
|
|
50,000,000
|
|
|
50,000,000
|
|
BTI Investment
Earnings 3%
|
|
250,000
|
1,050,000
|
300,000
|
1,600,000
|
|
Institutional
Match
|
|
|
|
30,000,000
|
20,000,000
|
50,000,000
|
|
Research
Endowment Earnings 7%
|
|
2,100,000
|
5,600,000
|
7,700,000
|
|
Institutional
Match
|
|
|
|
675,000
|
675,000
|
1,350,000
|
|
Total
Estimated Revenues
|
|
50,250,000
|
33,825,000
|
26,575,000
|
110,650,000
|
Memorandum
Person submitting Fiscal Note: Terry Hess
Email Address: hess@hepc.wvnet.edu