AUSTIN — The Legislative Budget Board met to adopt the spending limits for the Texas Legislature ahead of the 88th Session beginning in January.
The Legislative Budget Board is a permanent joint committee of the Texas Legislature that drafts the budget and provides fiscal notices for legislative committees. It is composed of 10 members from the House and Senate—including House Speaker Dade Phelan (R–Beaumont) and Lt. Gov. Dan Patrick. They met Wednesday to set the “constitutional tax spending limit on certain appropriations and the consolidated general revenue spending limit for the 2024-25 biennium.”
The constitutional tax spending limit, enacted in Article VIII, Section 2 of the Texas Constitution, ensures that the rate of growth in state tax revenue does not exceed the estimated rate of growth in the state economy.
For the 2024-2025 fiscal biennium, lawmakers on the LBB set the constitutional tax spending limit at $114,107,269,529, pegging the spending limit to a growth rate of 12.33 percent in Texans’ personal incomes over the next two years.
The consolidated general revenue spending limit ensures that revenue appropriations in a fiscal biennium do not exceed the estimated annual rate of growth in the state’s population, adjusted for the average rate of inflation. It is set at $135, 919,515,767.
Both of these limits are subject to adjustment as the final 2022-2023 fiscal appropriations are carried out.
LBB Director Jerry McGinty said budget writers are expected to have around $131 billion in general revenue appropriations to spend in the next biennium.
Last legislative session, the available appropriations were around $119 billion, which could increase by an estimated $12.5 billion this cycle.
Texas Comptroller Glenn Hegar predicted $149 billion in general revenue for the next biennium, which is a potential $27 billion surplus. He will make a final prediction in January, which could increase the final surplus available. However, the spending limits will ensure that the entirety of the surplus cannot be spent without two-thirds of both chambers agreeing to “bust” the limit.
Taxpayers, lawmakers, and watchdogs have been asking to use surplus dollars for property tax relief, but both Lt. Gov. Dan Patrick and House Speaker Dade Phelan have downplayed the potential for property tax relief.
The 88th Legislative Session begins January 10.
Citizens should be in contact with their elected officials to register their thoughts on the issues facing the state.