Digging into the Details: Our 2017 Texas Budget

The budget is usually one of the longest bills each session, and this session was no different with Senate Bill 1 running 969 pages long! The budget appropriates funds for a two-year period that begins September 1 after each legislative session. Before I share my take on the budget, I wanted to provide you with the following resources that will help you familiarize yourself with the Texas budget:

Budget 101

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This document is a pdf download and provides an introduction to the Texas budget process.

Summary of Budget

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This summary is also a pdf documentprepared by the Legislative Budget Board and provides a high level overview of this session's budget. The appendix also includes helpful information on how to read and understand the budget.

Text of the Budget Bill

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This is the 969 budget in full! and is a pdf document.

Now, here is my take on the Good, the Bad, and the Ugly in this session's budget.

The Good

We passed (another!) conservative budget for Texas! The budget totals $216.8 billion in all funds over the biennium, just a 0.2 percent increase from the last session's budget.
$800 million in funding for border security, maintaining historic levels of funding for public safety. Until the federal government shows that they can do their job, I will continue to support this level of funding.
$400 million increase in General Revenue funding for Child Protective Services, which should provide for up to 600 additional caseworkers, a higher level of pay, and a reduced number of cases per worker. Over the interim, there were a number of reports on the issues within Child Protective Services which is tasked with looking over our most fragile and vulnerable Texans. The legislature acted by ensuring they have the resources needed to care for these children!
$600 million increase in funding for our retired teachers health insurance program. This funding will help control the deductibles and premiums for our retired teachers, but a long term solution is still needed to ensure the solvency in their health insurance program.
$10.9 billion is expected to be in the Rainy Day Fund when the legislature returns again in 2019. This could increase if the price of oil and gas out paces the Comptroller's forecast.
$4 million was appropriated to Texas Tech University for a Veterinarian School. This issue has been debated for decades, but we finally moved the ball forward last session with this appropriation. While this is a great start, we still have lots of work to do!

The Bad

The Senate and House were unable to reach an agreement on school finance reform, which means the responsibility for funding public education will continue to shift from the state to local property taxes. Experts estimate that over $4 billion in funding will be shifted from the state to local property tax payers in this budget. School finance reform, a priority for the House, will hopefully be a priority for the entire legislature next session so we can finally provide Texans with meaningful property tax relief!

The Ugly

Some budget experts predict that there could be at least a $7 billion "IOU" when the legislature returns for the 86th session. Here is a quick breakdown of two major components in that IOU:
$2.0 billion in Medicaid funding. This is not a new trend, our budget frequently under pays the Medicaid program in the initial budget, only to come back next session with a supplemental bill to pay the remainder of the balance. However, this shortfall will be exacerbated due to even more funds being shifted away from our Medicaid budget in the special session.
$2.6 billion "IOU" for transportation funding. One of the more contentious budget debates between the House and Senate was related to financing of transportation. In 2015, voters overwhelmingly approved a constitutional amendment which dedicated roughly $4 billion in General Revenue to transportation funding. With $4 billion less in General Revenue available, the House looked at utilizing the Rainy Day Fund for certain expenditures, while the Senate preferred to defer the transportation payments to the 86th session. Ultimately, the two chambers reached a compromise in which certain expenditures would be paid for by Rainy Day Fund, and some of the transportation funding would be deferred until the 86th session.

Did You Know?

Texas is estimated to have $10.9 billion in our "Rainy Day Fund" in 2018, which will be the largest Rainy Day Fund among the 50 states!