It looks like the Texas Legislature won’t have quite as much cash to work with this time around.
“We estimate that state revenue available spending will be $104.9 billion” Texas Comptroller Glenn Hegar said Monday Morning–a day before the Legislature is set to kick off it’s 85th session.
That number represents a decrease of not quite 3% from what was available to Lawmakers in Austin during the last legislative session.
A big part of the equation that has resulted in declining revenue can be found in what has been a soft oil and gas market in recent months.
“Severance taxes have come in well blow–as oil and gas prices have dropped lower… and stayed lower for longer than we anticipated–as well as many other forecasters expected” Hegar said.
The Comptroller said another part of the equation is a decline in the amount of cash the State has been collecting through sales taxes–even as salaries and wages are climbing.
“This is likely due in part to a higher share of personal income going towards things like housing and health care expenditures that are not subject to sales tax” Hegar said.
Meanwhile, some budget watchers are not at all happy with Texas Comptroller Glenn Hegar’s revenue projection for the next two years.
“We don’t think that’s going to be enough for the State to even keep doing what it’s doing now” Dick Lavine with the Center for Public Policy Priorities said after the projection was released Monday Morning.
Those thoughts were echoed by the Center’s Eve de Luna Castro.
“That (to cover the costs of what the State is currently paying for) would take about $109-billion–and, that’s not fully covering for example the cost of inflation for schools” she said, adding “Everything costs more in the next two years, but $109-billion is the bear minimum to not be cutting State services.”
Part of the problem according to Lavine is a re-direction of some sales tax cash that was put in place during the last legislative session.
“Instead of leaving it in the budget to be decided by the Appropriations Committee–sending it straight to the highway fund for roads” Lavine said.
All in all though, Hegar said he expects the oil and gas market to strengthen–and, the overall outlook for Texas is still a bright one.
“It is important to note that Texas remains economically well-positioned compared to other states” Hegar said.