Monday, January 9, 2017

From the Texas Tribune: Hegar gives lawmakers dour revenue estimate for 2017 session

As we will see in 2306, this is a constitutional requirement. It establishes the ceiling for the Texas Appropriations bill - at least that part dealing with the general fund.

- Click here for the article.
Facing sluggish economic forecasts amid low oil prices along with billions in tax revenue already dedicated to the state highway fund, Comptroller Glenn Hegar announced Monday that lawmakers will have $104.87 billion in state funds at their disposal in crafting the next two-year budget, a 2.7 percent decrease from his estimate ahead of the legislative session two years ago.
Hegar told state lawmakers he expected a "slow to moderate" expansion of the Texas economy. Still, he said, the amount of revenue they will be able to negotiate over has fallen. That's largely because lawmakers in 2015 moved to dedicate up to $5 billion in sales tax revenue every two years to the state's highway fund, rather than being spent on other priorities such as schools, health care or reforms to the embattled Texas foster care system.
"We are projecting overall revenue growth," Hegar said. "Such growth, however, is more than offset" by the demands of the state highway fund and other dedicated funds.
The revenue estimate does not determine the scope of the entire Texas budget. Rather, it sets a limit on the state’s general fund, the portion of the budget that lawmakers have the most control over. The general fund typically makes up about half of the state’s total budget.
Two years ago, Hegar estimated that the Legislature would have $113 billion in state funds, also known as general revenue. Adding in federal funds and other revenue sources, lawmakers would have $221 billion in total for its budget, as well as $11.1 billion in the state's Rainy Day Fund, he said at the time. Lawmakers ultimately passed a $209.4 billion budget, which included billions in tax cuts.
On Monday, Hegar estimated lawmakers would have $104.87 billion in general revenue, and $224.8 billion in total revenue to write a budget for the 2018-19 biennium which begins in September.

- Click here for the report.


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