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Texas schools aren't among the odds-on budget favorites

Posted Friday, Jan. 11, 2013  comments  Print Reprints
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norman Comments from Gov. Rick Perry and Lt. Gov. David Dewhurst say a lot about what's likely to be in the budget the Legislature will produce come late May.

What's in: money for infrastructure needs, like water and transportation. Maybe tax cuts.

What's out: Maybe the idea of restoring $5.4 billion in public school funding trimmed from the budget two years ago.

Nothing's certain yet. A whole session of haggling is ahead, wrapping up May 27.

Perry's pushing for tax cuts, saying "the best use for the people's money is to give it back to them in some form or fashion." Conversation centers on reducing or even eliminating the franchise tax. The tax is expected to produce $9.5 billion during the 2013-14 budget cycle.

A business tax cut like that might be a form of giving tax money back to the people, but it's a roundabout one at best.

Comptroller Susan Combs said this week that legislators will have $101.4 billion in general-purpose spending available for the 2013-14 budget. That includes $8.8 billion in revenue that was unexpected and unspent in the 2011-12 budget.

Dewhurst said in an interview published Thursday by The Texas Tribune that the base budget in the Senate will be "$88 or $89 billion."

Subtract that base number from the $101.4 billion available for general spending and you see a "surplus" of about $13 billion.

Dewhurst also told the Tribune he expects a $5.2 billion "supplemental" spending measure to pay bills incurred but not covered in the current 2011-12 budget. That includes $4.5 billion in known but deliberately unbudgeted Medicaid costs.

Texas leaders like to brag that they, unlike federal officials in Washington, D.C., always produce a balanced budget. It's easier when you turn a blind eye to known expenses.

Pulling the $5.2 billion in supplemental spending out of the mix brings the "surplus" down to $7.8 billion.

Another trick that made the current budget look balanced was delaying $1.9 billion in payments to school districts until the first month of the 2013-14 budget. Lawmakers will now use part of the available money to pay that expense, making the same trick available to the next Legislature looking for some budget wiggle room.

With that subtraction, the "surplus" is down to $5.9 billion. It's easy to see that restoring $5.4 billion in school funding cuts suddenly becomes difficult. It would suck up almost all the remaining money.

There will also be $11.8 billion available in the state's rainy-day fund.

Perry says that rainy-day money should not be used to cover continuing expenses (that eliminates the $5.4 billion for schools) and that the balance should be "strong" and "preserved" for future needs.

Perry and Dewhurst have talked about paying to put the state's water and transportation infrastructure on better footing. Dewhurst wants to devote $1 billion from the rainy-day fund to water projects, the Tribune reported.

Neither leader has said how much to set aside for transportation needs, other than that they both favor ending the "diversion" of motor fuel tax revenue to uses other than building and maintaining roads. Part of that diversion is dictated by the state constitution and is untouchable.

An additional $881.5 million goes to other agencies, primarily the Department of Public Safety. It could be pulled back, but budget writers would have to use an equal amount to fund the DPS and the other agencies. It would be an ongoing expense, so it couldn't come from the rainy-day fund.

Perry says the growth in appropriations for public schools during the past decade has been "phenomenal." He dismisses pleas for more.

The Tribune said Dewhurst wants to set aside money (it would have to be billions) in case current lawsuits brought by more than half of the state's school districts force Texas to spend more on K-12 education. A state Supreme Court ruling is likely to come after the session ends.

School funding advocates face a decision on strategy: fight for big money in this session, or accept Dewhurst's approach: set aside as much as possible pending a court decision and spend more time during the session focused on things like the proposal to use public money to send students to private schools.

Mike Norman is editorial director of the Star-Telegram.

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Twitter: @mnorman9

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