Appropriations for most health and human service programs are based largely on the number of clients each program expects to serve during the upcoming biennium. Agencies update their caseload projections throughout the biennium to take into account new economic and demographic information that may not find its way into all agencies' projections simultaneously. Appropriations are not changed during the biennium to reflect updated caseload estimates. If a program's caseload is lower than projected, the program realizes a surplus, and if the caseload exceeds the projection, the program suffers a shortfall. Agencies, therefore, have an incentive to overestimate caseloads during the appropriations process.
Agencies use information from a number of federal and state sources to estimate caseloads.
This information may include economic data, such as employment and wage statistics from the Texas Employment Commission or from federal poverty information. Population data may come from the U.S. Bureau of the Census. Agencies also must factor into projections the potential effects of new state and federal legislation. Agencies use various techniques to estimate caseloads. For example, the Texas Department of Human Services may choose one of several time-series methods, including a simple regression model, to estimate the Aid to Families with Dependent Children caseload.