If you read the chapter on fiscal policy carefully - and as you will see in the chapter on the plural executive - the comptroller's office is responsible for the biennial revenue estimate. It tells the legislature how much revenue is expected to be collected by the state during a fiscal period, which puts a cap on how much can be appropriated.
But since it is a projection, it can go wrong if something unexpected occurs.
Like a pandemic.
Here's an interview with the current comptroller about how the current pandemic will impact the current Texas budget.
- Click here for the article.
How does this economic downturn affect the state budget, and how are state officials responding?
- Hegar said that the outbreak of the virus has created a lag on the sales tax collection process and that his office expects to have hard numbers in terms of sales tax collections in June.
- Accounting for more than 50% of the state’s tax revenues, sales taxes are the biggest determination for the state budget. So until the data on current sales tax collections has been collected, Hegar said, the true economic effects of social distancing cannot be fully understood.
- Nevertheless, Hegar and his office have been compiling data from comparable economic periods and other “nontraditional datapoints” to offer state legislators some additional insight into how things may progress from here.
- While Hegar said that the current economic situation is fluid and that “there’s a lot of unknowns that we have,” he also said that he believes the state will be able to cover spending for at least the remainder of the year, and there is currently no reason to call a special legislative session.
- Hegar anticipates that the state’s Economic Stabilization Fund (commonly known as the rainy day fund) will only be slightly reduced as a result of the current downturn. “We’ll still have a significant amount of money,” he said, estimating that the new ESF would be in the range of $8.5 billion.
- Hegar’s office is working with other agencies in the state to help them track their spending and to ensure that agencies that will need to increase their spending (such as the Children's Health Insurance Program, Foundation School Program or Medicaid) have the resources they need. His office is also recommending agencies look into ways of reducing their spending sooner rather than later.
