The House will consider its version of the state budget this Thursday and Friday, April 16-17. As it stands, the budget misses important opportunities to make real progress in priority areas including job creation, health care, education and infrastructure.
The good news is, the House can make big improvements to its proposed budget with just a few key changes.
Three Quick Steps to a Better Budget
1. Fund Hurricane Ike recovery with “Rainy Day” funds, not general revenue. If a hurricane isn’t a rainy day, what is?
2. Use stimulus “FMAP” funds as they were intended, to shore up key state services during the economic downturn: make children’s Medicaid enrollment last a full year instead of six months, and strengthen the social services eligibility system to accommodate increased traffic.
3. Direct stimulus housing, energy and workforce dollars to projects that achieve key policy priorities for Texas like creating good jobs in economically distressed areas and building our clean energy economy.
These changes won’t make the budget perfect. Texas’ perennial budget woes stem from an inadequate, antiquated revenue system. Legislators made the system even more rickety in 2006 with an unfunded property tax cut that left a “structural deficit.”
But using our stimulus funds wisely and appropriately will help Texas get ahead in critical areas. Fixing the revenue system may be a long, slow process but we don’t have to wait to start making other improvements.
What About Education?
The proposed budget uses $3.2 billion in federal “fiscal stabilization funds” to supplant general revenue that would have gone to education, thereby making that general revenue available to fund other budget items. While states technically may use stimulus funds to supplant general revenue in this way, members of the Texas congressional delegation and public education leaders throughout the state are questioning the Legislature’s decision to cut existing education spending and replace it with one-time emergency funds.
If the US Department of Education finds that Texas’ plans to supplant existing state education spending fall outside the bounds of allowable use of stimulus dollars, the Legislature would face a new shortfall in education funding. Lawmakers could either rewrite the entire budget to cover the education shortfall or use funds from the state economic stabilization fund (the “Rainy Day” fund).
