Texas Leaders Spending Big $ in House and Senate Budgets

The budgets being considered by the Texas Senate and Texas House may look fiscally conservative on their face. However, once you look at the details, it is clear these budgets will continue the recent trend of the Texas Legislature significantly increasing state spending while manipulating the data in various ways in order to pretend otherwise. The Texas Senate and House budgets are anything but conservative.

Both the Senate and House budgets claim to spend less than $251 billion, yet neither budget as written is capable of funding expected Texas spending over the next two years. Here is the Texas budget as proposed by the House in CSSB 1, which is up for a vote on the House floor this Thursday:

And here is the Senate’s version of the budget, passed on April 6:

In a press release issued after it passed its version of the budget, the Texas Senate claimed that “the budget approved by the Senate will spend $250.7 billion in state, federal and other funds, and slightly increases state revenue spending by 2.6 percent – well within constitutional spending limits.”

Most Texans would be very happy if it were true that the Texas Legislature was only going to spend $250.7 billion, meaning that it decided to reduce spending by $14 to $18 billion. However, we all know that is not going to happen. Instead, all that red ink in the budgets means Texas will need more money just to maintain current spending levels; not to mention increasing spending.

The bad news for taxpayers is the state will get the money it wants from the federal government. The Senate acknowledged this: “The budget approved Tuesday does not include any money from the $1.9 trillion aid package approved by Congress in early March.”

In fact, Texas is in line to receive up to $32 billion from Biden’s American Rescue Plan (ARP).

The Texas Senate discusses some of the problems related to the federal funding: “One factor in the delay is a lack of clarity about federal requirements that come with those funds. As state officials work to get that clarity, [Sen. Jane] Nelson said it isn’t wise to accept funds when we don’t know what strings are attached.”

While that is true, what the Senate and House are really doing by not including the federal funds in their budgets is obscuring the fact that Texas will accept a significant portion–and perhaps all–of the available federal funds. This does not promote transparency in the Texas budget process or give Texans an accurate picture of how much government spending will increase this biennium.

Assuming that Texas accepts all $32 billion in federal ARP funds provides clarity that the Texas Legislature is likely to greatly increase spending this biennium under either the Senate or House bills:

The result is a four-year spending spree: appropriations will increase at least $31.5 billion from 2019 and $63.2 billion from 2017. As seen below, appropriations in 2021 will increase from 2019 by at least 12.7%, more than double the 5% increase in population growth plus inflation:

Appropriations Bill	SB 1 (2017)	HB 1 (2019)	S CSSB 1 (2021)	H CSSB 1 (2021)
Biennium	2018-19	2020-21	2022-23	2022-23
State Funds	$144,753,606,187	$161,860,065,431	$164,039,000,000	$163,465,300,000
Federal Funds	$71,854,658,298	$86,453,768,639	$119,664,374,000*	$116,313,200,000*
Total Appropriations	$216,608,264,485	$248,313,834,070	$283,703,374,000	$279,778,500,000
% Increase State		11.82%	1.35%	0.99%
% Increase Federal		20.32%	38.41%	34.54%
% Increase All		14.64%	14.25%	12.67%

Is Texas going to accept all of the federal funding? We do not know for sure. But what we do know is that Texas is going to accept the vast majority of it.

We know this because Texas will have to accept at least $18 billion (according to the House budget) to get spending back to even. Then if Texas accepts the remaining $15 billion, that would only increase the Texas budget by 6%, far below the 9.6% average biennial increase since 2003.

The Big Spenders in Texas government will accept as much of the $32 billion in federal “relief” funding as they can get away with. They just will not tell you that is what they are going to do until after the Texas Legislature leaves town and they can hide in relative anonymity.

Here is a one-pager with the essential details explaining the increase in appropriations.