Texas budget shrinks, making spending cuts likely

Texas Capitol (KXAN Photo/Andy Jechow)
Texas Capitol (KXAN Photo/Andy Jechow)

AUSTIN (KXAN) — State lawmakers will have less money to spend as the new legislative session gets underway on Tuesday.

The state Comptroller’s office released their estimate of how much money they can budget for. On Monday morning, Comptroller Glenn Hager said state lawmakers will have $104.9 billion over the next two years.

While that seems like a lot of money, it is nearly a $10 billion drop from 2015’s $113 billion for the last legislative session. One reason for the drop in revenue is because of gas prices dropping.

State Comptroller Glen Hegar said, “I felt like, we felt like, and many economists felt like, that Texas would have turned the corner earlier. However, it lagged much longer than we thought.”

Hager said the actual amount of revenue available over the last two years was $5 billion less than expected. However, lawmakers won’t need to find a way to make it up this session due to a surplus from the last session in 2015.

So how did we get here? Adding to the downturn in the oil and gas sector, in 2015 lawmakers passed and voters approved changes to the constitution that took billions of dollars off the table. The first was dedicating $5 billion every budget to the state highway fund. Then, voters approved property tax relief and lawmakers cut the businesses tax, totaling around $4 billion.

Even though it’s a drop from the last session’s budget, the announcement means the state of Texas has the second largest amount of money available. In 2005, the state had $64.7 billion to spend. The budget rose to $82 billion in 2007 and dropped during the “Great Recession” before it jumped to more than $100 billion in 2013.

After the Comptroller’s announcement, a leading House member told reporters that we would need 4 to 5 billion dollars more just to keep the services the same.

“Obviously it could have been worse,” said Rep. Drew Darby, R-San Angelo. “It is what it is and we will deal with the aspects of this budget as we move forward.”

So what areas could get a pinch this next budget?  The two largest sections of the state government are education and healthcare. Healthcare is difficult to cut because much of the money has matching federal funds attached, so cutting one state dollar actually loses Texas two-and-a-half total dollars. Analysts for the left-leaning Center for Public Policy Priorities fear that leaves education dollars vulnerable.

Eva DeLuna Castro from CPPP said, “If you cut public education funding you are putting more pressure on local school property taxes, which we’ve heard legislators want to do something about.”

In 2015,  lawmakers gave the Texas Department of Public Safety $800 million for border security. Now DPS is asking for close to a billion dollars.  A press conference scheduled in the Texas House Wednesday looks at asking the Trump administration to pay Texas back or at least pay for more of the border security here in our state.

Most of the money state lawmakers have to spend comes from sales taxes, which make up more than half of the General Revenue funds. The next largest contributor comes from motor vehicle sales and rental taxes. Property taxes don’t get siphoned to the state, those go to local governments and school districts.

High Needs

The low budget numbers come when the state has high needs.

Just this past week, there was another child death in Texas. The murder of 5-year-old Giovanna Hernandez at what police say was the hands of her own mother, adds to the staggering numbers. Child Protective Services confirmed to KXAN News they had previous involvement with the family and the child’s mother Krystle Villanueva.

The problem is simple but massive: there’s too much child abuse and neglect in Texas and not enough people or resources to handle the load. More than 200 Texas children died last fiscal year and approximately half of those children had open Child Protective Service case files.

Lawmakers have deemed CPS funding a priority, so other areas will likely lose out.

“At the end of the day, it’s going to be about how do we prioritize those dollars that are going to be available,” said  Dr. Vance Ginn from the Texas Public Policy Foundation. He says lawmakers should start every department at zero, then justify every dollar spent. “Look you aren’t going to be able to fund everything like you would like. Maybe if you want to increase it by large amounts. But what that means you have to be effective and efficient with each one of those dollars.”

In between sessions, in the wake of child deaths, the state’s top leaders approved $140 million to increase salaries at Child Protective Services and hire 800 more people. But Gov. Greg Abbott tells KXAN that was just a stop-gap measure. More funding and reforms are necessary this year to fix the department.

 

 

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