* Strong economic growth boosted revenue
* Budget ends with $8.8 billion surplus
* Fast-growing Texas will also need more spending, analyst
By Corrie MacLaggan
AUSTIN, Texas, Jan 7 The Texas Legislature will
have 12.4 percent more revenue to spend in the next two budget
years thanks to higher-than-expected tax collections boosted by
economic growth, state Comptroller Susan Combs projected on
"Texas experienced a very strong rebound from a severe
recession," said Combs, who issued her biennial revenue estimate
a day before the Texas Legislature convenes.
Texas has a two-year budget cycle and lawmakers will craft a
2014-2015 budget during the session, which ends May 27.
Combs forecast revenue of $101.4 billion - which the
comptroller says is 12.4 percent greater than corresponding
funds available for the current budget cycle - including $8.8
billion expected to remain at the end of the 2012-2013 budget
The state's general revenue collections are projected to be
$96.2 billion, $3.6 billion of which would be set aside for the
state's rainy-day fund.
Combs estimated that the rainy-day fund will have $8.1
billion at the end of the current budget cycle and $11.8 billion
at the end of the 2014-2015 cycle.
Collections of sales tax, oil and natural gas production
taxes and motor vehicle sales taxes have exceeded expectations,
"We are lucky to be right now in a very significant
oil-and-gas-based effort, along with the motor vehicle sales
tax," Combs said. "Other states do not have some of these extra
Texas has regained all of the 428,000 payroll jobs it lost
in the recession and has added an additional 258,000 jobs beyond
the pre-recession peak, Combs said. By contrast, the U.S. has
recovered about half of the 8.8 million jobs lost, she said.
The comptroller now estimates that there is $90.2 billion
available for the 2012-2013 budget cycle.
Two years ago, facing a budget shortfall, lawmakers
underfunded the state's Medicaid program by $4.7 billion. They
are expected to authorize money for that program when the new
GOVERNOR PLEDGES CONSERVATIVE SPENDING
Texas Governor Rick Perry said Monday that the comptroller's
projection shows that the state made the right decisions two
years ago in being careful with its budget in the face of a
"Even as we head into the 83rd Legislative Session with
higher revenues, we still need to focus on separating our wants
from our needs, and continue to follow the conservative
principles that have led to Texas' ongoing success and will keep
Texas strong," Perry said.
Dick Lavine, a senior fiscal analyst at the Center for
Public Policy Priorities, said that although the $101.4 billion
is more than the state has had in the past two years, it is $7
billion short of what Texas needs to return to a pre-recession
level of services.
"It does sound like a lot more money but don't forget: We're
a fast-growing state and the things that the state pays for cost
more every single year," said Lavine, whose Austin-based
organization advocates for low- and moderate-income Texans.
The Center is urging lawmakers to tap the rainy-day fund to
pay for population growth and inflation and to undo what it
calls devastating cuts made in 2011 to education, health care
and other areas.
Talmadge Heflin of the Texas Public Policy Foundation, which
favors limited government, said the amount of revenue growth is
a pleasant surprise but cautioned that lawmakers should "not go
on a spending binge."