February 01, 2003
Hochberg on the budget

Here, via Greg Wythe, is some more detail about that $10 billion budget deficit and how big cuts will have to be if our elected leaders are serious about no tax increases:

1.) While the Texas budget totals around $113 billion, about $35 billion of that is really pass-through money that comes from the federal government to operate what are essentially federal programs. We can rarely use federal money to reduce state expenditures, and, in fact, usually have to put up some state money to get the federal money. When we talk about being $10 billion short, that is the shortfall in the state portion of the budget.

2.) Actually, it’s not even the entire state portion that we are talking about, because some state funds are “dedicated” to specific purposes. For example, 3/4 of the money the state collects from gasoline taxes can be used ONLY for highways and other transportation. Dedicated monies amount to $16 billion, and are essentially “off book” when it comes to the deficit. We don’t have to spend it, but we can’t use it for any other purpose, nor can we use it to balance the budget.

3.) After taking away the federal and dedicated monies, we end up with about $62 billion as the actual state budget. But of that $62 billion, about $22 billion goes directly to local school districts. We don’t have to send them that money, but chances are pretty good that if we don’t send it, they will raise local property taxes to cover the shortfall we create.

4.) So, assuming we don’t cut school district funds, that leaves us finding $10 billion out of the $40 billion that remain. (That is not to say that school district funds could not be cut - but it’s not exactly living up to our responsibility to get out of this by cutting someone else’s budget.)

This is from a mailing by State Rep. Scott Hochberg (D, Houston). I don't believe for a second that we'll be seeing 25% cuts across the board (actually, it'd be more like 20% since $1.8 billion of that must be done before August), so keep your eyes open for all kinds of fuzzy math.

Posted by Charles Kuffner on February 01, 2003 to Budget ballyhoo | TrackBack