Was it financial gimmicks or sound thinking that helped the 81st Legislature balance the state’s budget in a strenuous economic climate? A little of the first, a dash of the second, with a generous helping of previously made correct decisions to control the size of state government. But changes need to be made to protect Texas’ designated funds from flowing into general revenue.

To be sure, Texas’ government isn’t as constrained as it should be, having grown more than 40% in the last decade. But that is far lower than the growth of non-defense federal spending, and much lower than the other states.

U.S. Senator Kay Bailey Hutchison wasted no time in issuing a press release on Monday laying blame for the gimmicks at Gov. Rick Perry’s feet. Since the budget is prepared, drafted and passed by both houses of the Legislature (with historically little input from any governor), it’s hard to follow the KBH logic. Except as further evidence her team doesn’t know much about the state’s legislative process.

When interviewed for a weekend article in the Houston Chronicle about budget gimmackry, Senate Finance Committee Chairman Steve Ogden said that to avoid redirecting funds this session would have meant a combination of 1) spending cuts 2) increasing taxes or 3) dipping into the rainy day fund.

The first choice is rarely politically popular and the second choice was out of the question (as it should have been) as the nation is struggles with its worst financial bout since the Great Depression. Preserving the rainy day fund was the gold star house and senate leadership hoped to earn for their hard work so…

Funneling monies from other funds was tapped as the temporary fix.

Of course, a fourth option (not mentioned in the article) is to limit the growth of government when we find ourselves in times of economic prosperity. Once again, California serves as a prime example of overextending in the good times and then getting pummeled doubly in the bad.

Though it is easy to shift the blame in this balancing act, the buck falls to state Senators and Representatives who draft the budget and dictate the inner workings of our states taxing and spending structure. A great case in point and one that dwarfs those griped about in this particular article is our highway fund which will be looted once again to the tune of $1.2 billion in the next biennium.

TFR has taken a loud, clear and strict position opposed to diverting funds into GR. Dedicated funds should be used for dedicated purposes; excess dollars in those funds should be repaid to the people, not hoarded by government.

Stopping diversions will lead to better budget writing and greater accountability. Until then we can expect gimmicks to persist.

Daniel Greer

Daniel Greer is the Director of Innovation for Texas Scorecard.


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