View
221
Download
0
Category
Tags:
Preview:
Citation preview
A Balanced Approach To Meeting the Needs of Texas F. Scott McCown, Dick Lavine, Eva DeLuna Castro
mccown@cppp.org, lavine@cppp.org, deluna.castro@cppp.org
The Texas State Budget for 2010-11
Higher Ed.12%
HHS13%
K-12 Ed.14%
Other8%
Prisons3%
Highways6%
Federal36%
HHS 20%
K-12 Ed. 8%
Highway 4%
Other Fed. 4%
Property tax cut, 8%
Biennial Total: $182 billion
Federally funded = shown in white; other areas are General Revenue,
GR-Dedicated, & “Other” State Funds.
We’re Still In the Hole Created in 2006
In billion $ 2008-09 2010-11
5/06 Fiscal Note
11/09 Cash Report
5/06 Fiscal Note
11/09 Certification
Franchise tax 6.8 3.0 7.7 3.4
Tobacco tax 1.4 1.9 1.3 1.8
Used car, interest 0.1 0.0 0.1 0.1
TOTAL REVENUE 8.3 4.9 9.1 5.4
Cost of property tax cut
-14.2 -14.2 -14.9 -14.9
SHORTFALL -$5.9 -$9.3 -$5.8 -$9.5
$1.4
$1.5
$1.6
$1.7
$1.8
$1.9
$2.0
$2.1
Sep Oct Nov Dec Jan Feb Mar Apr May June July Aug
Billion $
The Recession Reduced Sales Tax Revenue
Fiscal 2008
Fiscal 2009Fiscal 2010
“One-Time” Money Balanced the 2010-11 Budget
Current Budget
2012-13 Budget
General Revenue $75.0 billion $75.0 billion
ARRA Used for GR $6.4 billion $0
Cash on hand $2.6 billion $0
Property Tax Relief Fund carryover
$3.0 billion $0
Permanent School Fund $0 $1.2 billion
TOTAL GR BUDGET $87.0 billion $76.2 billion
GAP $10.8 billion
Funding a Balanced Approach:Easy Money
Potential Revenue for 2012-13
Economic growth with no change in revenue system
$800 million for each 1% growth
Accounting AdjustmentsPayment delays, etc
$2.0 billion
Funding a Balanced Approach:Spend the Rainy Day Fund
Potential Revenue for 2012-13
Beginning balance $8.2 billion
Growth during 2012-13 $1.0 billion
Total Rainy Day Fund Available
$9.2 billion
When Can the Rainy Day Fund Be Spent?
• 1) If GR forecasted for the rest of a biennium is less than the GR appropriated, RDF can be used to cover the shortfall – vote of 3/5 of members present (up to 90 in House; 19 in Senate)
• 2) RDF can be used “at any time and for any purpose” – 2/3 of members present (up to 100 in House; 21 in Senate)
Source: Comptroller of Public Accounts, Annual Cash Report
Sources of State Revenue 2009Total $84.3 billion
Licenses, Fees, Fines,
Penalties9%
Interest/Investment
Income2%
Taxes45%
Lottery2%
Other5%
Federal Funds37%
Local 8%
State 27%
Special District6%
County 8%
School District20%
City 8%
Other State Taxes25%
Sales Tax35%
Property Tax40%
Sources: Comptroller of Public Accounts, Biennial Revenue Estimate 2008-09, January 2007; Annual Property Tax Report. Forecast by CPPP.
Major State & Local Taxes in Texas 2009
Source: Comptroller of Public Accounts, Annual Cash Report.
State Tax Collections 2009Total $37.8 billion
Other3%
Insurance3%
Gas/Oil Production 6%
Franchise11%
Sin (Cigarette,
Tobacco, Alcohol)
6%
Motor Fuels8%
Motor Vehicle Sales and
Rental7%
Sales56%
How the 2004-05 State Budget was “Balanced”
Cuts to 2003 Budget: $1.4 billion
Cost shifting: $1.9 billion
“Smoke and mirrors”: $1.2 billion
Rainy Day Fund: $1.3 billion
Federal Fiscal Relief: $1.4 billion
Revenue Measures: $1.8 billion
Cuts to 2004-05 Budget:
$6.6 billion
Estimated General Revenue
Shortfall of $15.6 billion
Unfunded Items in the 2004-05 State Budget
Cost shifts23%
K-12 schools20%
General Govt, Workforce
Comm., Lottery 5%
Other HHS Cuts & unfunded
caseload growth 17%
HHS Provider rate cuts 4%
System Benefit Fund 5%
Public Safety & Prisons 7%
Natural resources
2%
State employee health care
3%
Higher Ed 14%
Budget Scenario for 2012-13
$0
$25
$50
$75
$100
2002-03 2004-05 2006-07 2008-09 2010-11 2012-13
Local School Tax Cut (GR and PTF)
GR for Higher Ed
ARRA instead of GR
Other GR
GR for HHS
Other GR for K-12
GR for Prisons
Additional GR Needed
$7 b
$1 b
None
$3 b
$3.3 b
$300 m
$700 m
Use of This Presentation
The Center for Public Policy Priorities encourages you to reproduce and distribute these slides, which were developed for use in making public presentations.
If you reproduce these slides, please give appropriate credit to CPPP.
The data presented here may become outdated.
For the most recent information or to sign up for our free E-Mail Updates, visit www.cppp.org
© CPPP
Center for Public Policy Priorities900 Lydia StreetAustin, TX 78702
P 512/320-0222 F 512/320-0227
Recommended