Gov. Greg Abbott, Lt. Gov. Dan Patrick, and House Speaker Dustin Burrows are directing most state agencies to reduce their baseline budget requests by 3 percent, as Republicans push for meaningful property tax relief during the upcoming legislative session.
In joint guidance issued to state agencies, institutions of higher education, and other state entities, the three leaders outlined priorities for preparing Legislative Appropriations Requests for the 2028–29 biennium.
The guidance calls on agencies to reduce their base appropriation requests by 3 percent, while exempting several priorities, including the Foundation School Program, Medicaid, the Children’s Health Insurance Program, foster care, adoption assistance, and the Texas Education Savings Account Program.
State leaders said the spending restraint is intended to help address affordability concerns while preserving funding for key priorities.
“Texas leads the nation with a strong economy and responsible governance that puts families first,” Abbott said. “This guidance protects our historic investments in public education and teachers, delivers even more property tax relief, and makes the cost of living more manageable for Texas families through strict standards of efficiency and accountability from every state agency.”
The guidance follows what leaders described as major accomplishments during the 89th Legislature, including teacher pay raises, investments in water infrastructure and healthcare innovation, and $51 billion in property tax relief.
Agencies seeking funding above their baseline allocations must submit those requests as exceptional items and identify lower-priority programs or other savings to help offset the additional costs.
Lt. Gov. Dan Patrick said the directive keeps Texas on “a fiscally conservative path” while maintaining the state’s economic competitiveness.
Speaker Dustin Burrows said the reductions will establish “the baseline for a conservative budget that prioritizes property tax relief and strategic investments to support our state’s growth.”
The guidance comes after lawmakers last year approved a state budget that increased state spending by 43 percent compared to the 2022–23 biennium, drawing criticism from fiscal conservatives who argued more of the state’s surplus should have been devoted to property tax relief.
Meanwhile, Abbott continues building support for a sweeping property tax reform proposal he has made a centerpiece of his reelection campaign.
Abbott has said the plan would permanently reduce homeowners’ property taxes by requiring the state—not local property taxpayers—to assume responsibility for funding public education. The proposal would also impose stricter limits on local government spending, lower appraisal caps, and require voter approval for a broader range of property tax increases.
Andrew McVeigh, president and CEO of Texans for Fiscal Responsibility, praised the move as an important first step toward reducing Texans’ tax burden.
“There are no shortcuts to eliminating property taxes and lowering the overall tax burden on Texas families,” said McVeigh. “Fiscal discipline is the first and most important step to many of the problems facing our state, including our crushing property tax system and affordability crisis.”
“Government at every level is going to have to cut spending if we’re going to tackle these critical issues meaningfully,” he added. “The measures Texas’ Republican leadership have asked state agencies to take today are a critical first step in order to prioritize property taxes in the 90th Legislature.”
The guidance also instructs agencies to continue fully funding public education, maintain support for the Education Savings Account program, and preserve funding required by law for Medicaid and other major entitlement programs as lawmakers begin preparing the next biennial budget.
