Texas Economy Is ‘robust,’ Giving Lawmakers $9 Billion More for Next Budget, Glenn Hegar Says

This is a developing story.AUSTIN -- Texas lawmakers will have nearly $9 billion more in general-purpose state revenue in writing the next two-year budget, Comptroller Glenn Hegar said Monday."The economy has been extremely robust," Hegar said, issuing his revenue estimate for the 2020-2021 cycle.But the Republican chief tax collector warned that lawmakers will have to plug holes in the current budget they passed in 2017 before they start applying some of the additional $8.9 billion of general revenue to new initiatives.He mentioned IOUs in the Medicaid health insurance program for the poor, state costs for Hurricane Harvey and other unfunded liabilities.Hegar also said that while the Texas economy "will continue to outpace" that of other states, he sees a "cloudy" fiscal picture."The U.S. and global economies are uncertain and any slowdown will affect Texas," he said.Trade tensions with China and President Donald Trump's renegotiating of the North American Free Trade Agreement pose unique risks to Texas, which "has more international trade than the other 49 states," Hegar said."That uncertainty can cause a question mark of where we're going as a state economy," he said.Hegar's forecast sets a ceiling on what lawmakers may spend this session as they write the state's next two-year budget.They also can tap into a "rainy day fund." They are expected to do so, at least to defray between $1 billion and $2 billion of state costs from Hurricane Harvey.Hegar said the reserve, which currently has about $12.5 billion, should grow to $15.4 billion by Aug. 31, 2021, before any drawdowns by lawmakers."Despite this projected revenue growth, the Legislature will again face some difficult choices in balancing the budget," he said. "The most pressing and costly budget drivers for the upcoming session include a potentially large boost in education spending to reduce the property tax burden and reform school finance."  Continue reading...