Texas State Budget And Finances

Texas budget and finances

General information

Budget calendar: Biennial

Fiscal year: 2017

State credit rating: AAA (as of 2017)

Current governor: Greg Abbott

Financial figures

Total spending (state and federal funds): $127,283,000,000 (estimated 2016)

Per capita spending: $4,568 (estimated 2016)

Total state tax collections: $52,132,817,000 (2016)

Per capita tax collections: $1,871 (2016)

State debt: $48,237,511,000 (2014)

Per capita state debt: $1,759 (2014)

State budget and finance pages • Total state expenditures • State debt • Tax policy in Texas

Note: In comparing dollar amounts across the states, it is important to note that the cost of living can differ from state to state and within a state. The amounts given on this page have not been adjusted to reflect these differences. For more information on "regional price disparities" and the Consumer Price Index, see the U.S. Department of Commerce, Bureau of Economic Analysis. This article, which is updated on an annual basis, was last updated in June 2017. It contains information from several sources; consequently, the currency of the information can vary from source to source.

In Texas, as in other states, lawmakers and public officials are elected in part to manage the state's finances. This includes generating revenues (money coming into the state from various sources) and approving expenditures (the money spent on governmental functions and servicing state debt). State budgets are complex and fluid, as they depend on anticipated revenues and planned expenditures, which may alter over the course of a fiscal year. If revenues do not keep pace with expenditures, states generally have to raise taxes, cut services, borrow money, or a combination of the three. State budget decisions are also influenced by policy decisions at the national level, such as the Affordable Care Act or energy and environmental regulations, and issues at the local level, such as crime and the quality of education.

Definitions[edit]

The following terms are used to describe a state's finances:

• Revenues come mainly from tax collections, licensing fees, federal aid, and returns on investments.
• Expenditures generally include spending on government salaries, infrastructure, education, public pensions, public assistance, corrections, Medicaid, and transportation.
• State debt refers to the money borrowed to make up for a deficit when revenues do not cover spending.
• The state credit rating is the grade given by a credit rating agency based on the general financial health of the state's government and economy.
• State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."^[2]
• Federal funds are "funds received directly from the federal government."^[2]
• Total spending is calculated by adding together the totals for state and federal funds used for expenditures.

Revenues[edit]

2016 revenues[edit]

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2016 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "2016 population" and "Per capita collections" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "2016 population" and "Per capita collections" have not been abbreviated.^[3]

The table below lists 2016 tax collections by source as percentages of total collections. About 88.9 percent of Texas' total state tax collections came from sales taxes and gross receipts.^[3]

Federal aid to the state budget[edit]

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, mainly in the form of grants for such things as Medicaid, education, and transportation. In 2014, federal aid to the states accounted for roughly 31 percent of all state general revenues. Federal aid varies from state to state. For example, Mississippi received approximately $7.2 billion in federal aid in 2014, accounting for about 41 percent of the state's general revenues, the highest percentage of all of the states. By contrast, North Dakota received about $1.5 billion in federal aid in 2014, or just 17 percent of the state's general revenues, the lowest percentage in the nation.^[4]

The table below notes what share of Texas’ general revenues came from the federal government in 2014. That year, Texas received approximately $38.6 billion in federal aid, 31.8 percent of the state's general revenues. Taking into consideration the state's 2014 population, this came out to about $1,434 in federal aid per capita. Figures from surrounding states are provided for additional context.^[4]

Spending[edit]

Estimated 2016 expenditures[edit]

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2016 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.^[5]

The total estimated government spending in Texas in fiscal year 2016 was $127.3 billion.

Spending by function[edit]

See also: State spending by function as a percent of total expenditures

State spending in Texas can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2015 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.^[5]

In fiscal year 2015, education accounted for 37.5 percent of Texas' total expenditures.

Spending trends[edit]

The table below details the spending trends in Texas in previous years. Figures are rendered as percentages, indicating the share of the total budget spent per category.^[1][6][7]

State debt[edit]

See also: Texas state debt

State debt refers to any debt owned by a state government. Debt may include any financial obligations a state has that have not been paid, such as bonds issued by state governments, money borrowed by a state government that has not been repaid, or post-retirement benefits promised to state employees. According to the U.S. Census Bureau, Texas had a debt of $48,237,511,000 in fiscal year 2015. The state debt per capita was $1,759. This ranked Texas sixth among the states in debt and 42nd in per capita debt. The total state debt owned by the 50 states was $1.15 trillion with a per capita debt of $3,582.^[8]

Economic indicators[edit]

See also: Economic indicators by state

Texas' GDP increased by 5.2 percent in 2014. Click the image to view a larger version.

Broadly defined, a healthy economy is typically one that has a "stable and strong rate of economic growth" (gross state product, in this case) and low unemployment, among many other factors. The economic health of a state can significantly affect its healthcare costs, insurance coverage, access to care, and citizens' physical and mental health. For instance, during economic downturns, employers may reduce insurance coverage for employees, while those who are laid off may lose coverage altogether. Individuals also tend to spend less on non-urgent care or postpone visits to the doctor when times are hard. These changes in turn may affect the decisions made by policymakers as they react to shifts in the industry. Additionally, a person's socioeconomic status has profound effects on their access to care and the quality of care received.^[9][10][11]

Between 2011 and 2013, residents in Texas had a median annual household income of $51,752, highest among neighboring states. The state also had the largest portion of residents that earned incomes above 400 percent of the federal poverty level in 2013.^{[12][13][14][15]}

Note: Gross state product (GSP) on its own is not necessarily an indicator of economic health; GSP may also be influenced by state population size. Many factors must be looked at together to assess state economic health.

Budget process[edit]

The state operates on a biennial budget cycle. The sequence of key events in the budget process is as follows:^[16]

1. Budget instructions are sent to state agencies beginning in June.
2. Agencies submit their budget requests to the governor between July and September.
3. Agency hearings are held between July and October.
4. The governor submits his or her proposed budget to the state legislature by the date of the State of the State address.
5. The legislature typically adopts a budget in May. A simple majority is required to pass a budget. The fiscal year begins in September.

Texas is one of 44 states in which the governor has line item veto authority.^[16]

The legislature is constitutionally required to adopt a balanced budget. The governor must sign a balanced budget into law.^[16]

Agencies, offices, and committees[edit]

The following standing committees in the Texas State Legislature deal with budget and finance matters:

1. Appropriations Committee, Texas House of Representatives
2. Finance Committee, Texas State Senate
3. Ways & Means Committee, Texas House of Representatives

Public Interest Research Group 2016 report[edit]

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2016. The report, entitled "Following the Money," measured how transparent and accountable state websites were with regard to state government spending. According to the report, Texas received a grade of A- and a numerical score of 93.5, indicating that Texas was "Leading" in terms of transparency regarding state spending.^[17]

Budget and finance ballot measures[edit]

Voting on state and local government budgets, spending, and finance
Policy
Budget policy
Ballot measures
By state
By year
Not on ballot
Local City budgets County budgets Spending limits School budgets

See also: State and local government budgets, spending and finance on the ballot and List of Texas ballot measures

Ballotpedia has tracked the following ballot measures relating to state and local budget and financial matters in Texas.

1. Texas Growth Fund Investment, Proposition 9 (1995)
2. Texas Governor Fiscal Control, Proposition 5 (1980)
3. Texas Repayment of Transportation Funds, Proposition 2 (1991)
4. Texas State Debt Payable from General Fund, Proposition 11 (1997)
5. Texas Grain Warehouse Fund, Proposition 1 (1987)
6. Texas Federal Reimbursement of State Highway Funds, Proposition 1 (1988)
7. Texas Compensation Fund for Victims of Crimes, Proposition 10 (1997)
8. Texas Tomorrow Fund, Proposition 13 (1997)
9. Texas Permanent School Fund Amendment, Proposition 6 (2011)
10. Texas Financial Assistance for Fire Departments, Proposition 17 (1989)
11. Texas Local Government Investments, Proposition 19 (1989)
12. Texas Economic Stabilization Fund, Proposition 2 (1988)
13. Texas Higher Education Assistance Fund, Proposition 2 (1984)
14. Texas Assistance for Needy Children, Proposition 2 (1982)
15. Texas Water Laterals, Proposition 3 (1985)
16. Texas Survivors of Public Servants, Proposition 3 (1984)
17. Texas State Finance Committee, Proposition 3 (1981)
18. Texas Assistance for Economic Development, Proposition 4 (1987)
19. Texas Growth Fund, Proposition 3 (1988)
20. Texas Land for Permanent School Fund, Proposition 4 (1985)
21. Texas State Financing of Texas Business, Proposition 6 (1987)
22. Texas Mutual Insurance Premiums, Proposition 6 (1984)
23. Texas Retirement Fund Investment, Proposition 7 (1991)
24. Texas State Appropriations, Proposition 9 (1985)
25. Texas State Water Fund Amendment, Proposition 6 (2013)
26. Texas Debt Payment Excepted from Appropriations Limitations Amendment (2015)
27. Texas Investing Proceeds from Sale of Lands, Proposition 3 (August 1883)
28. Texas University Fund Investment, Proposition 5 (August 1887)
29. Texas Transferring Monies from the Permanent School Fund, Proposition 5 (August 1891)
30. Texas Investment of the Public School Fund, Proposition 1 (1896)
31. Texas Investing School Funds in Bonds, Proposition 3 (August 1897)
32. Texas Reorganization of University Funds, Proposition 5 (May 1919)
33. Texas Investment of the Permanent University Fund, Proposition 2 (1930)
34. Texas Investment of University Funds, Proposition 8 (1932)
35. Texas Retirement Fund for School Employees, Proposition 4 (1936)
36. Texas Red River County Indebtedness, Proposition 4 (1940)
37. Texas Certification of Appropriations Bills, Proposition 1 (1942)
38. Texas Building Construction at John Tarleton Agricultural College, Proposition 3 (1942)
39. Texas Investment of the Permanent School Fund, Proposition 4 (1942)
40. Texas Building Construction for John Tarleton Agricultural College, Proposition 1 (1946)
41. Texas Retirement, Disability and Death Compensation System, Proposition 2 (1946)
42. Texas Veterans' Land Fund, Proposition 1 (1951)
43. Texas Assistance for the Needy, Proposition 2 (1951)
44. Texas Investment of the Permanent University Fund, Proposition 5 (1951)
45. Texas State Medical Education Fund, Proposition 2 (1952)
46. Texas Lending State Credit, Proposition 5 (1954)
47. Texas Assistance for the Needy, Proposition 8 (1954)
48. Texas Confederate Pension Fund Transfer, Proposition 11 (1954)
49. Texas Construction for Institutions of Higher Learning, Proposition 3 (1956)
50. Texas Veterans' Land Fund, Proposition 5 (1956)
51. Texas Expenditures for State Promotion, Proposition 7 (1958)
52. Texas Assistance for the Needy, Proposition 2 (1962)
53. Texas Assistance for the Disabled, Proposition 8 (1962)
54. Texas Assistance for the Needy, Proposition 2 (1963)
55. Texas Permanent School Fund Transfer, Proposition 1 (1964)
56. Texas Medical Care for the Needy Elderly, Proposition 3 (1964)
57. Texas Improvements for Institutions of Higher Education, Proposition 1 (1965)
58. Texas Veterans' Land Fund, Proposition 2 (1965)
59. Texas Assistance for the Disabled, Proposition 15 (1966)
60. Texas Veterans' Land Fund, Proposition 3 (1967)
61. Texas Public Assistance, Proposition 2 (1968)
62. Texas Investment of the Permanent University Fund, Proposition 3 (1968)
63. Texas Assistance for the Needy, Proposition 5 (August 1969)
64. Texas Assistance for Spouses and Children, Proposition 7 (August 1969)
65. Texas Student Loans, Proposition 8 (August 1969)
66. Texas Appropriations for Assistance Grants, Proposition 3 (May 1971)
67. Texas County Permanent School Fund, Proposition 14 (1972)
68. Texas Veterans' Land Fund, Proposition 7 (1973)
69. Texas Finance Constitutional Provisions, Proposition 5 (1975)
70. Texas Veterans' Land Fund, Proposition 2 (1977)
71. Texas Veterans' Housing Assistance, Proposition 8 (1985)
72. Texas Financing Products and Businesses, Proposition 3 (1989)
73. Texas School District Bonds, Proposition 12 (1989)
74. Texas Funding for Institutions of Higher Learning, Proposition 13 (1993)
75. Texas Farm and Ranch Finance Program, Proposition 3 (1995)
76. Texas Growth Fund Investments, Proposition 6 (1997)
77. Texas Permanent University Fund Investment, Proposition 17 (1999)
78. Texas Mobility Fund, Proposition 15 (2001)
79. Texas Rail Relocation and Improvement, Proposition 1 (2005)
80. Texas Economic Development Program Loans, Proposition 3 (2005)
81. Texas Use of the Permanent School Fund, Proposition 9 (September 2003)
82. Texas Funding for Transportation Projects, Proposition 14 (September 2003)
83. Texas Buffer Areas for Military Installations, Proposition 1 (2009)
84. Texas Sales and Use Tax Revenue for Transportation Amendment, Proposition 7 (2015)
85. Texas Proposition 7, Increase Distributions to School Fund Amendment (2019)
86. Texas Proposition 8, Flood Infrastructure Fund Amendment (2019)
87. Texas Proposition 5, Sales Tax on Sporting Goods Dedicated to Parks, Wildlife, and Historical Agencies Amendment (2019)

Budget and finance legislation[edit]

The following is a list of recent budget and finance bills that have been introduced in or passed by the Texas state legislature. To learn more about each of these bills, click the bill title. This information is provided by BillTrack50 and LegiScan.

Note: Due to the nature of the sorting process used to generate this list, some results may not be relevant to the topic. If no bills are displayed below, no legislation pertaining to this topic has been introduced in the legislature recently.

Recent news[edit]

The link below is to the most recent stories in a Google news search for the terms Texas budget. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

Contact information[edit]

Texas Governor's Office of Budget, Planning and Policy
1100 San Jacinto, 4th Floor
Austin, Texas 78711
Telephone: 512-463-1778

See also[edit]

• Historical Texas budget and finance information
• Tax policy in Texas
• Texas government sector lobbying
• Texas public pensions
• Governor of Texas
• Texas State Senate
• Texas House of Representatives
• Texas State Legislature

Footnotes[edit]

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