According to the Legislative Budget Board (LBB), the fiscal implications of HB 5333 cannot be determined at this time. This uncertainty stems primarily from a lack of available data regarding two critical variables: (1) the number of eligible doctoral students who would qualify for and receive fellowships and (2) the total amount of funding that would be appropriated or otherwise made available for awarding the fellowships.

The bill directs the Texas Higher Education Coordinating Board (THECB) to administer the fellowship program and establish rules concerning student eligibility and permissible uses of fellowship awards. While THECB will need to manage and oversee the program, the LBB notes that any administrative costs associated with this responsibility are assumed to be absorbable within existing resources, meaning no new appropriations or staff expansions are expected to be necessary.

At the local level, the LBB found no significant fiscal impact on units of local government.

In summary, while the bill's creation of the STEM Excellence Graduate Fellowship Program could involve significant expenditures if heavily funded, no direct funding amount is specified, and administrative costs are anticipated to be manageable within current agency budgets. As a result, the actual financial footprint of the program will depend entirely on future legislative appropriations or external funding sources.

HB 5333 proposes the creation of the STEM Excellence Graduate Fellowship Program, which would provide merit-based fellowships to high-achieving doctoral students in science, technology, engineering, and mathematics fields. The bill would have the Texas Higher Education Coordinating Board (THECB) administer the program, award fellowships directly to students, and allow funding through a combination of state appropriations and private donations. Although the bill aims to support the development of Texas's research universities and STEM workforce, it raises concerns related to government expansion and fiscal policy.

The bill would grow the scope of government by establishing a new state-run program, even if administrative costs are initially absorbed by existing resources. Creating a new fellowship program under a state agency opens the door to future increases in spending through legislative appropriations, even though no new funding is mandated at this time. Lawmakers committed to limiting government might view this as an unnecessary expansion of state functions into areas that could instead be supported by private institutions or industries.

Moreover, even if the financial burden on taxpayers is not immediate, the potential for future taxpayer-funded appropriations to sustain or expand the program remains. This risk, combined with the fact that the program provides state-administered educational grants rather than focusing on broader taxpayer relief, could be viewed as misaligned with fiscal conservative priorities. Additionally, the bill does not impose new regulatory burdens on individuals or businesses, but it does represent a philosophical expansion of state involvement in educational funding.

For these reasons—concern about growing government responsibilities, increasing potential future costs to taxpayers, and a preference for private-sector solutions—Texas Policy Research recommends that lawmakers vote NO on HB 5333.

• Individual Liberty: The bill expands opportunities for individuals (doctoral students) to pursue advanced education through merit-based fellowships. Participation is voluntary, and students are free to choose whether to apply.
• Personal Responsibility: The program is merit-driven. Students must achieve academic excellence to qualify and maintain the fellowship. It rewards hard work, not entitlement.
• Free Enterprise: While developing a stronger STEM workforce is beneficial for the economy, this program uses public resources (or state-administered private resources) to influence the education and research markets, where ideally private industry and universities would take the lead. It represents a government-driven incentive in a space that should be competitive and market-based.
• Private Property Rights: The bill does not affect private property rights. No confiscation, eminent domain, or regulation affecting property ownership or use is involved.
• Limited Government: The bill expands the scope of government by creating a new, ongoing program within a state agency. Although funding is discretionary and administrative costs are projected to be absorbed initially, it creates a permanent new function that could later demand more taxpayer funding or expand beyond its original scope.